Not long ago, Zillow led the lead in Ibuying and bought houses directly from sellers, often with steep discounts. Many large brokers followed the example to compete and launched their own offer. These were one-on-one transactions without exposure to the open market. The justification? “Ease.” It was fine, we were told, because sellers knew what they started and there were disclosures if they didn’t.
Fast forward to today, and some of the same players now explain that listing a house everywhere, but the MLS is dangerous. In fact, so dangerous that they completely block those lists from their platforms.
How did we go from “it’s great to advertise to one buyer” to “if your house is not exposed to every buyer, is it malpractice”?
The answer is not transparency. It’s economy.
Zillow earns billions by controlling the committee of an agent by controlling the lead current of the MLS. Private listing Networks (PLNS) threaten that funnel. So the message has changed. What was once a legitimate choice of consumer is now framed as a public danger.
To be clear, selling a house off-MLS can mean fewer buyers and lower offers. But here is the thing: sellers already understand that. Exp Realty, one of the greatest brokers in the country, created a disclosure of one page that clearly outlines the risks of limited exposure. It is simple, simple and readable at high school level. It was widely praised by the largest players in the industry as a great step to protect consumers.
My teenage daughter understands. She knows that if she wants Topdollar, she will sell on Depop that she prefers the perfectly focused teenage audience, not at a garage sale. But sometimes she still chooses the simplicity of a local sale. Less hassle, faster results and no costs. Do I have to scold my daughter to leave money on the table? Should we be obliged to also pay to mention on eBay because it has a larger audience and more name recognition than Depop?
Let us look at the industrial attitude towards a double desk. This is perhaps one of the most structurally conflicting relationships in real estate, and yet it remains legal in many states. The solution of the industry? A simple disclosure form.
Although Double Agency forces agents to take a step back from fully pleading for both parties and often leads to vague, compromised negotiations in which “encounter in the middle” replaces aggressive representation, disclosure is sufficient. Why? Because it often doubles the committees.
To be honest, not all intra-brokerage deals present these kinds of conflicts. Many companies use designated office models where each party has a separate representative. But if the industry is comfortable to trust a disclosure for something that is structurally complex, why is the same standard not acceptable for a seller who decides how wide their house brings on the market?
When the competition comes into the picture, such as mention outside the MLS, the public is suddenly too naive to understand the risks. That is not transparency. That is a double standard.
What is rarely discussed is that the industry is not only limited where agents can mention, it takes the most valuable active in every transaction: the data.
In other platform economies (Facebook, YouTube, even retail media), makers exchange their data or content for meaningful benefits: reach, generate income or free access. In real estate agents are told the same thing: give us your listing details and in exchange you will receive exposure. But here is the difference – agents also pay for the privilege. They finance the MLS through contribution and then look at their data flow at portals and platforms that earn money again, often due to referral costs that further reduce their income.
If the data is so valuable, why not share agents in the top? Why can’t they choose platforms that reward their contribution or pass on savings to their customers? Instead of becoming participants in the authorization in the data economy, agents are treated as suppliers who feed a system that they are also forced to subsidize.
Some in the industry now want the MLS codified in the law, a ‘utility’ only in name, without supervision, price regulations or accountability. In reality, this would anchor control and continue to exclude more than a million licensees who cannot afford a contribution or choose not to become a member of NAR. And with straight faces, these same voices claim that not using their system is malpractice.
The Ministry of Justice saw the problem. As part of his settlement interviews, the DOJ insisted on MLS access to all recognized agents, not only those who pay brokers. Nar refused. That disagreement helped to derail the deal. If MLS accessory was really public and affordable, the participation would probably double, increase competition and reduce the costs for consumers. But that would mean that the velvet ropes let go.
This brings us to a different form of selective framing: the way in which selling prices are measured and promoted.
Studies from the industry often claim that FSBO and OFF-MLS houses sell for less than those mentioned on the MLS. But these analyzes almost always focus on the gross selling price and ignore what is actually important for consumers: net yield. A FSBO vendor may accept a lower price, but if they save 5-6% in committees, they can come forward, or at least even. Net yield, not just the top price, should be the benchmark for consumer results.
Zillow’s own recent study, for example, discovered that off-MLS lists sold on average 1.5% less. What was not mentioned is whether those sellers have paid a fraction of the committee or a single committee. By omitting that context, the message becomes misleading: as if a seller who tries something else just loses money.
If the industry really believes that consumers cannot understand these considerations, then presenting top-line figures without mentioning that committee costs are not only incomplete, it is unfair. In the best case it is selective framing. In the worst case, it is a polished form of gas light dressed as consumer protection.
If we really care about consumers, let’s prove it:
- Require clear disclosures, no mandates.
- Prohibition to double a transaction by the same agent to remove the most serious conflicts of interest, while retaining intra-office designated agency where each party has a separate representation.
- Outlaw of at least transparency in hidden reference costs that quietly extract up to 40% of each committee.
- Let sellers decide how to sell, with normal disclosures, not gatekeeping.
Transparency is not the problem. It is the pretext that consumers must be saved from choices that are easy to understand. If a seller wants wide exposure, they will choose it. If they want privacy, speed or discount committees, let them have it, with eyes wide open.
Don’t be the transparency. Before it.
Dean Dicarlo is the CEO of Homing.
This column does not necessarily reflect the opinion of the editorial department of Housingwire and the owners. To contact the editor who is responsible for this piece: [email protected].
