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A Phil Hall Op-Ed: Dark clouds have formed around the National Association of Realtors’ (NAR) Clear Cooperation Policy, with many prominent figures within the real estate industry calling for it to be jettisoned. However, it seems like an equal number of prominent figures are calling for its preservation. How this issue shakes out could very well determine the future of NAR.

The NAR policy is relatively new – it was only established in 2020 – and it mandates that listing brokers upload their publicly marketed listings within one business day to an MLS. NAR argues the policy works for sellers seeking to reach the widest number of potential buyers. The organization also claims that not having this policy creates so-called pocket listings that create an exclusionary market where sellers could lose money and minorities would not be able to have access to certain listings.

One of the most vocal supporters of the Clear Cooperation Policy is Redfin CEO Glenn Kelman, who posted on a company blog that brokers opposed to this policy “would rather promote pocket listings as a way to justify high fees and to build their own businesses. The brokers who oppose Clear Cooperation still want to post pictures of the listing to the Internet, but only on their own site. This puts the broker first and the customer second.”

On the other hand, the folks behind the American Real Estate Association (AREA) have taken aim at the policy, first with a petition drive to rally industry opposition and then by announcing it might begin a class action lawsuit against NAR’s policy because of damage it allegedly created. The AREA petition statement claimed realtors are forced to adhere to the policy even if their clients are opposed to it.

“This overreach by NAR strips away homeowners’ control over how and when to promote their properties, severely limiting their ability to attract offers that may be more aligned with their privacy needs or financial goals,” said AREA’s petition, adding that real estate agents who don’t follow the policy “face penalties of up to $5,000 simply for following the wishes of the homeowners they are sworn to serve.”

More unhappiness with NAR came from Utah, as the Park City Board of Realtors announced it will stop enforcing the Clear Cooperation rule. While this is not among the largest realtor organizations – the Utah MLS has slightly less than 1,800 subscribers – it could be the first crack in the wall holding up the policy.

And even the U.S. Department of Justice (DOJ) has voiced potential antitrust concerns over the policy, which was among the reasons that it is trying to junk its 2020 settlement with NAR and reanimate its investigation of the organization – NAR is trying to get the Supreme Court to weigh in on the DOJ’s actions.

NAR is not oblivious to the tumult this policy is creating. Last month, the organization’s MLS Technology and Emerging Issues Advisory Board raised the issue of the Clear Cooperation Policy by reviewing input from various industry stakeholders on whether the policy should be retained, erased, or rewritten in a compromise designed to please all parties. That meeting did not offer any clue on how NAR will proceed, and more meetings are planned.

How will NAR respond to the pressures on this policy? In my humble opinion, NAR will not rush to a decision, but rather try to take a wait-and-see approach. And I suspect time could be NAR’s ally.

After all, a Trump election victory next month will most likely result in new leadership at the DOJ that will drop the plans to tear up the 2020 agreement, while a Harris victory would then leave it up to the Supreme Court to stop the DOJ’s probe into the policy – which is likely since the conservative-leaning court has been frequently critical of how the Biden-era DOJ hase behaved.

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As for the class action lawsuit threat from AREA, it is difficult not to wonder if this threat was simply an attention generating stunt by the start-up organization – their petition drive has yet to reach its 5,000-signature goal and its would-be social media campaign to encourage the use of “#EndCC” was a flop. And unless a regional group larger than the Park City Board of Realtors revolts against the policy, it will be business as usual among the realtor groups.

Of course, there could be an unexpected development that could doom the policy faster than anyone anticipated. But until that comes, I am of the opinion that the Clear Cooperation Policy will not be altered or canceled anytime soon. But that’s my opinion – what do you think?

Phil Hall is editor of Weekly Real Estate News. He can be reached at [email protected].

 

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