Things will be different from now on, and I’m not talking about wearing facemasks in public, I’m talking about the Clear Cooperation Policy that begins today for all Realtors nationwide!
Many of you have not likely heard of this new policy that was adopted by the National Association of Realtors back in November of 2019, and goes into effect today for all members of NAR nationwide. This will affect whether you are looking to sell your home or purchase a home.
In a nutshell, the Clear Cooperation Policy requires ALL listings to be entered into the listing agent’s respective Multiple Listing Service or MLS as we call it within 1 business day of when they begin to publicly advertise the listing. That means within 1 business day of sending out postcards, or flyers, or email blasts, or putting a sign in the yard, or putting it on any public-facing websites, whether the broker’s own website or sites like Zillow or Realtor.com.
So, why is this important? Well, previously, real estate agents were allowed to pre-market their listings, they did this in hopes of attracting a buyer and then “double ending” the transaction. Double-ending simply means that one agent represents both the seller and the buyer and they get ALL of the commission and that’s where the trouble began. There is nothing wrong with double ending a transaction as long as the seller, the client, is being properly represented. Unfortunately, it only takes a few bad apples to ruin it for everyone and that’s exactly what happened in this case.
There were some agents that took this to the extreme and never put the listing on the MLS then sold it and collected the entire commission without ever exposing the property to the entire marketplace! As we all know, the more eyeballs on a property, the more interested buyers and hopefully more offers which will likely lead to a higher offer for the seller!
But if the property is never exposed to the entire marketplace, how does the seller know that they got the most they could have gotten for their property? Sadly, some sellers accepted offers without ever knowing that their home was not exposed to the entire marketplace. Therefore, NAR adopted the Clear Cooperation Policy to ensure that all properties are entered on to the MLS where all agents have a chance to bring their buyers to the table.
Sellers will benefit because they will know that their home is getting the maximum exposure that will likely bring them more qualified buyers and not just the buyer’s listing agent represents. However, it may not be good news for buyers, especially here in San Diego where we have such a low supply of inventory.
Prior to today, listing agents were allowed to do what we call a “coming soon” campaign, and buyers would have a bit of a heads up on properties that might fit their criteria. Now, with a limited timeframe, buyers must be ready to act fast once they see a property go active.
There may be some listing agents that don’t like this new policy but there is one clear beneficiary and that is the home sellers! And that’s the way it should be.
If you have any questions or concerns that I can answer for you, please don’t hesitate to reach out to me.