The response to a problematic institution is reform, not replacement, coach Darryl Davis composes, and NAR has both the authority and the responsibility to lead that reform.
After more than 40 years in this market– training agents, being in living rooms, watching markets shift and policies come and go– I have actually discovered that the most essential questions are rarely the loudest ones. They are the ones no one is quite comfy asking out loud.
I wish to raise one of those questions today. I raise it with real respect for those who see it differently and with complete awareness that sensible people can disagree. But I also raise it because the representatives I have actually invested my profession serving should have someone ready to say the quiet part clearly– before the window to say it closes.
There is a conversation getting momentum in our market about whether MLSs ought to have to complete for agents– whether a nationwide MLS or a network of broadening regional ones might force regional systems to serve representatives better. I understand the appeal. Competitors has actually produced better outcomes in many industries, and there are legitimate frustrations with how some MLSs operate.
However the more I sit with this concept, the more a quiet issue grows in me. And I feel an obligation to share it, even if I remain in the minority.
My concern is not about competition as a concept. My concern has to do with what MLS competitors specifically would produce– and who would benefit most from it.
The MLS is not like other organizations
When we speak about competitors producing much better outcomes, we are normally speaking about service organizations– where 2 companies use similar products and the better one wins. That model works because the two contending items are essentially interchangeable. You can switch from one to the other and still get what you came for.
The MLS is various in a fundamental way. Its worth does not come from the quality of its service. It originates from its comprehensiveness.
The MLS is worth something exactly because every listing is in it. Every representative submits there. Every complying broker can see everything. The moment you have two MLSs in the same market, neither one is complete. And an incomplete MLS is not a much better MLS. It is a decreased one.
I think of it by doing this. Picture if a city decided its roadways should take on each other. One roadway is totally free, kept by the city, goes all over. A 2nd road is private, better paved and takes you to the most desirable neighborhoods quicker. The personal roadway might be better. However the moment people begin selecting roadways, the city road loses financing, loses maintenance and eventually loses the locations that made it important. Individuals who can not pay for the private road are entrusted what stays.
That may seem like a stretch. But I think it deserves sitting with before we decide competitors is the response.
Who benefits when MLSs contend?
Here is the question I keep returning to: If MLSs needed to contend for agents, which MLSs would win?
The answer, I think, is the ones with the most agents currently devoted to them. In a competition for market share, the organization that arrives with the largest representative network has one of the most leverage over what the winning MLS appears like. Its choices form the rules. Its priorities form the policies. Its tolerance– or intolerance– for particular restrictions determines what limitations make it through.
I am not suggesting that would be deliberate. I am recommending it would be structural. Big organizations shape the institutions they control because their scale makes it inevitable. Right now, the biggest residential real estate company in the country has 340,000 agents following the acquisition of Anywhere Realty earlier this year. That is not a criticism of any company. It is merely a reality about the mathematics of what MLS competition would look like on the ground.
Competition between equals tends to produce much better results for customers. Competition in between non-equals tends to produce outcomes for whoever is biggest. The concern worth asking is which one we are in fact explaining?
The guardrails we consider granted
Regional MLSs are governed by regional broker committees, regional associations and individuals who understand their particular markets. That governance is dispersed across numerous organizations.
No single brokerage– no matter how large– can control all of them all at once. A brokerage with 2,000 representatives in Phoenix has real impact at the regional level there. It does not have the same influence over how MLSs run in Boston or Atlanta or Seattle.
That distribution of governance is not attractive. It is not efficient. It produces inconsistency and, in some cases, rules that do not serve their markets well. I comprehend the disappointment with that.
However I also think that dispersed governance is among the most important structural protections representatives and consumers have right now– and many people in our industry do not understand it due to the fact that they have actually never seen it threatened at this scale before.
If MLS competitors consolidates governance towards the biggest gamers, those guardrails erode quietly– market by market, guideline by guideline– till the cooperative system every independent representative constructed their company on is simply gone. Not taken. Competed away.
What I would ask instead
The frustrations driving this discussion are genuine. There are MLSs that have been slow to serve their members, guidelines that feel approximate and policies that did not produce what they assured. Those should have to be dealt with.
However I believe the answer to a problematic organization is reform, not replacement. And I believe NAR has both the authority and the responsibility to lead that reform– by reinforcing the national requirements that all MLSs need to meet, by requiring significant seller disclosure before any listing goes personal and by developing governance structures that avoid any single organization’s size from translating into disproportionate policy influence.
Those are harder discussions than “let MLSs complete.” They require NAR to make decisions that will annoy powerful individuals. However they preserve the thing that made this industry worth structure– a cooperative marketplace where an agent with ten listings and an agent with ten thousand listings can both serve their clients on equal footing.
Maybe I am wrong about all of this. Perhaps MLS competition would produce exactly the consumer-friendly, agent-serving market its proponents describe. I hope somebody smarter than me will make that case, and I will read it thoroughly.
But in the meantime, I feel an obligation to name what I see– because the agents I have actually spent my career serving deserve somebody happy to ask the uncomfortable concern before the response becomes long-term.