Chicago Brokers Weigh MRED's Nationwide MLS Expansion

Chicago’s brokerage leaders are weighing the impacts of the local Multiple Listing Service’s national expansion, the latest in a dizzying series of changes to home marketing that has taken over the industry.

Midwest Real Estate Data, the MLS operator for Chicago and much of Northern Illinois, announced last week it was opening up access to any licensed agent in the country, including access to its Private Listing Network. The expansion was backed by Compass International Holdings, which will syndicate its national active listings to MRED. Compass International Holdings agents nationally also have the option to put their Private Exclusive and Coming Soon listings on the Private Listing Network.

The Private Listing Network, which is relatively unique among MLSs, was created in 2016 and allows agents to list properties that don’t appear on public websites like Zillow but are still visible by all agents in the MLS. Critics of true brokerage-exclusive pocket listings tend to like that setup better, because it gives any agent in the region the same access.

Laura Ellis, the chief strategy officer and president of residential sales at Baird & Warner, said the Private Listing Network has been a positive development for Chicago’s market, and that expanding the network broadly would be good for the industry.

“We don’t know how it’s going to play out, but the [Private Listing Network] really works,” she said. “So we’ll have to see how the rest of the industry responds to that, and if they’re going to participate in that.”

The national expansion is the latest in a recent flurry of decisions by major industry players to better control listing data, leads and marketing strategies. It comes just weeks after Compass struck a deal with Rocket to syndicate its Coming Soon inventory on Redfin, prompting Zillow to react with Zillow Preview, its pre-marketing program for partnered firms.

Mike Golden and Thad Wong, the co-CEOs of Chicago-based @properties, which was acquired by Compass early last year, said in a statement that MRED is adapting to the evolving real estate market.

“We applaud MRED for taking this step to expand choice for home sellers and access and transparency for buyers, while also protecting agents who are performing their fiduciary duty,” Wong and Golden said. “MRED is an innovative company that has always focused on solutions, and expanding the PLN nationwide is another bold and timely solution.”

Some brokerage leaders in Chicago said the expansion is a clear sign that MRED is looking to compete as a national MLS. The inclusion of the private network, as well as Compass’ national inventory, likely makes that offer more enticing for agents outside the Chicago area.

TJ Rubin, the president of Fulton Grace Realty, said he thinks agents in other states will sign up for the private network.

“Features like the [Private Listing Network] are strong pioneering moves,” he said. “The [Private Listing Network] has got such great adoption in Northern Illinois, I can’t see how features like that wouldn’t be widely accepted in other markets.”

Whether agents elsewhere will see value in joining another MLS for private listings will determine how far MRED’s expansion travels. Compass said it will subsidize the first 100,000 agents across its brands that sign on to join MRED. If it reaches that number, it would triple the size of MRED’s membership, currently at around 48,000.

MRED already has competition in the national MLS space. Realtracs, the MLS serving the Nashville area, announced on Thursday that it would offer national coverage through partnerships with Compass International Holdings and United Real Estate, Inman reported.

Michael Horwitz, the managing broker at Chicago-based Cross Street, said he’s hoping the MRED expansion and Compass partnership will lead to more exposure to Compass’ private inventory for independent brokerages like Cross Street. He said clients sometimes ask whether they’re missing out on Compass’ exclusive inventory by working with another brokerage.

“If private listings are shared more broadly or fairly, then I think that will work out better for the consumer,” he said. “But I’ll be interested to see where this continues to go in terms of the syndication of these listings.”

For agents day-to-day who sell locally in Chicago, it’s not clear that much will change. Compass agents were already syndicating many Private Exclusives and Coming Soon listings to the Private Listing Network. Grigory Pekarsky, who leads the Vesta Team at Vesta Preferred Realty, said he has largely unplugged from the industry listing wars. He said the fracturing of listing data hasn’t hampered his team’s ability to make deals.

“I don’t think it’s going to affect much of anything in the Chicago area,” he said. “I’m looking at the way consumers are shopping, what they’re looking for. I don’t think the consumer cares one way or another.”

Joe Zimmerman, operating principal at Keller Williams OneChicago, said his top focus amid changing industry standards is to make sure his agents have the skills to strike the best deals for their clients — whether that’s through pre-marketing strategies or tracking new avenues for off-market listings.

“More access and more platforms can be a positive if it creates optionality,” Zimmerman said. “The challenge, though, is making sure it doesn’t create confusion for consumers.”