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    « Restricted Lumber Sales? | Main | FTC and DOJ Will Host Joint WorkshopOn Competition Policy & The Real Estate Industry »


    Realty Freak

    A question: If a real estate agent, hired to market a property and assist the seller in obtaining the best possible price and terms for his or her property, knows the best way to do this is by letting every potential buyer know about the property through every available marketing channel, why would anyone opt a listing out of anything?

    Another question: If a real estate agent had no chance of double ending a sale (getting the listing and co-op commission) and had no chance of obtaining a buying client through the marketing of the listing, would any agent care where or by whom the listing is displayed? I think the answer is no.

    The question every consumer and real estate agent should be asking is; why do brokerages want the right to opt out of having their clients properties advertised on other real estate websites? The answer to this question is greed.

    You see; if you are a big broker with thousands of agents and thousands of listings, you might be tempted to exclude your client’s listings from other real estate websites in order to increase your chances of being the broker of the seller’s agent and the buyer’s agent thereby collecting both commissions.

    Last year three of the biggest brokerages in Chicago removed their listings from the MLSNI, one of the biggest multiple listing services in the country. They gave a cornucopia of conflicting and nonsensical reasons for the pull out but limited the listings they pulled to those of the north suburbs of the city. That indicates to me it was a test. It did not work, within a year they put their listings back in the MLS. That indicates to me the experiment was a failure. Who suffered from this failure? The public and the small independent brokers who serve them suffered.

    To stay competitive, small, mostly non-traditional brokers wasted thousands of dollars joining a previously insignificant listing service the big three moved the listings to(which by the way does not allow its listings displayed on the internet), only to see that money wasted when the big brokers returned to MLSNI. Consumers who had their homes listed with those big brokers suddenly had a significantly smaller marketing channel for their properties, but as one homeowner told me, they where told it would not affect them. Worst of all, overnight the data that consumers, real estate agents and appraisers have come to depend upon for determining market value was fragmented and thereby rendered less effective.

    Property ownership has become as important in this country as the stock market and federally insured banks in terms of building individual wealth. The government has a responsibility to ensure fair competition and make sure brokers and agents fulfill their fiduciary responsibilities.

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