MLS and Paradigm Shifts

Written by Posted On Saturday, 21 November 2020 21:00

What if current litigation or DOJ settlement eliminates a pillar of MLS, the Offer of Compensation? Play along with me here.

In the current litigation, and proposed settlement by NAR to the DOJ, this is a possibility that no one is yet discussing.

Remember, the reason MLS is constructed the way it is constructed, is that it has been altered based on litigation and settlements over many cases and many years.

I have been discussing paradigm shifts for the last 30 years. One of my favorite bodies of work on the subject is Joel Barker's "The Business of Paradigms," where I learned the paradigm shift questions, which I have been repeating to real estate professionals since I first heard it (and the reverse of the question):

"What is currently possible to do in your business, and if it were impossible, it would FUNDAMENTALLY change the way you do business?"

FUNDAMENTALLY being the key word to describe a paradigm shift. Answering this question will take you to the edge of your future.

One thing that is currently possible in the world of brokerage and MLS is for the listing broker to pay a commission to the broker/agent who brings a buyer (this person is referred to as the "Selling Agent").

This is what makes MLS work, the assurance that if as broker brings a buyer to another broker's listing, and the property sells, the broker who brings the buyer is protected and will receive a commission.

What if as part of the current DOJ litigation, offers of compensation by the listing broker are forbidden, forcing agents who work with buyers to look to the buyer for compensation? Would that FUNDAMENTALLY change the way you do business?

There may be a time when the buyer signs the compensation agreement with you, and not the seller.

The wheels are in motion, and the outcome is yet unknown, but the best time to see the cliff is before you reach it.

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