Friday Flash: Open or closed?

News, opinions, “takes,” reports, memes, tweetstorms, blog posts, email newsletters like the one you’re reading now — they move into and out of our awareness along a river that never stops running at flood stage.

When something truly important bobs by, it is, like everything else, pushed onward and out of our view by whatever comes behind it. It could be that somebody made a lot of money, or did something stupid, or maybe did something beautiful. 

Our attention is re-focused. We move on. 

Well, I want to not move on from something that floated past this week: Redfin CEO Glenn Kelman’s piece pointing out that pocket/private/office exclusive listings jumped 67% in the course of a year-long period during which most industry leaders were touting their commitment to fair housing. Glenn calls upon NAR to close the “office exclusives” loophole it left open when it passed new rules around off-MLS listings in 2019. 

That fair housing and exclusive listings are incongruent seems factually indisputable, and Glenn points to a lot of the research casting light on those facts. It’s also just common sense: If you put a listing in front of nearly all agents via the MLS, you are diminishing the potential for steering, or, worse, flat-out exclusion. If you share the listing with a much smaller group, you increase the likelihood that those things will happen. 

Now, look, I wasn’t born yesterday. This is a very self-serving position for Redfin to champion. Redfin built its business selling other brokers’ listings. They built a national real estate company, and a heavily trafficked website, by displaying other brokers’ listings through IDX. They list far fewer homes than they sell. Compass, which seems to have baked exclusives into its core strategy (though you would be hard-pressed to hear them state that publicly), now has 5% national market share in a footprint that significantly overlaps with Redfin. 

Office exclusives threaten Redfin gravely. 

Many big listing brokers view Redfin as a parasite, a company that lives off their hard won success while suggesting, self-righteously, that they alone really have the consumer’s best interests at heart. 

I know.

But you can be self-serving and also be right; you can be sanctimonious and also be right. 

I understand the financial realities facing many brokers. It’s hard to squeak out a profit. I get why selling your own listings is appealing, or even necessary for survival. 

But I also wonder if this strain isn’t in fact healthy, ultimately. I know lots of big brokers who have gobbled up struggling competitors and strengthened their ability to compete in a low-margin world. I know lots of small brokers who are thriving because their size enables them to focus more easily on quality than their bigger rivals. Isn’t that how it’s supposed to be? The strong supplanting the weak? Quality prevailing over laziness?  

Listen, maybe we even ditch IDX if we think it’s jumped the tracks it was meant to ride on. Whatever. There are a lot of wrinkles here. 

But put the damn listings on the MLS. 

Because this is about what kind of industry we want to be, and what kind of housing market we want to create: open or closed. 

It is that simple. It is that important. 

I often think of those buyers out on Long Island, the ones we watched get steered or blocked from properties and neighborhoods a couple years back, and just how more screwed they would have been if there were no MLS. In a world where “office exclusives” dominate, these people have no recourse. They can’t talk to another agent, at another company, in another office, to access the same property. The door is closed.

The brokers I know and respect have fair housing in their hearts. They don’t want to close the door on anybody. I don’t for an instant think that Robert Reffkin at Compass wants to make housing less accessible.  

But this is mostly not about intent. It’s about effect. 

Open or closed. 

Which do we want?