Since the implementation of the National Association of Realtors Clear Cooperation Policy (CCP8) in May 2020, the number of houses listed as going under contract within 24 hours of hitting their local MLS has increased, according to a new study released Wednesday by Broker Resource Network.
CCP8 requires listing agents and brokers to submit properties to their local MLS within one business day of public marketing. Essentially, it bans pocket listings. The policy came about in response to claims that agents and brokers were withholding listings from the MLS to the disadvantage of buyers, sellers and other agents.
Many expected that the implementation of this policy would cause the number of properties listed as zero days on market to decrease, however, as the Broker Resource Network study found, the number has increased.
The report examined data from 24 MLSs from the year before CCP8 came into effect (May 1, 2019-May 1, 2020) and the year after (May 1, 2020- May 1, 2021). All of the MLSs examined saw a double, if not, triple digit percent change increase in the number of properties recording zero days on the market.
Although the report does highlight that there are many innocent reasons a home may be shown as having zero days on market – including new builds; transactions where the seller represented themselves and the buyer had an agent; and homes that go under contract while listed as “coming soon” in markets that allow it – it does seem to suggest that there is a correlation between the implementation of CCP and the increase in homes having zero days on market.
On the surface this seems like a reasonable argument, but due to the pandemic and the wide spread of data from brokerage to brokerage within even a single MLS, some MLS executives disagree.
MIAMI Realtors MLS, for example, saw a range of 633% to negative 67% change in the number of homes recording zero days on market from the year prior to the implementation of CCP8, to the year after.
“Correlation of this change in Days on Market solely to Clear Cooperation and not considering the numerous other factors affecting the market seems imprudent,” Teresa King Kinney, the CEO of Miami Realtors, said in a statement. “The first portion of this study included the uncertainty of the beginning of COVID when we were in a slower market, and the second portion is during a time of extremely low inventory, heightened demand in our market, and historically low interest rates.”
Others, however, like Gustavo Rodriguez, the COO of bridgeMLS, felt that the high levels of percentage change were influenced by the addition of “coming soon” status and, to a certain extent, Clear Cooperation.
“We pulled all bridgeMLS listings the same way for the last four years and it shows that since CCP8 and coming soon status was added, we had a lot more of these 0 DOM listing,” Rodriguez said in a statement. “We attribute the increase in zero days on the market to the implementation of Coming Soon Status and somehow the implementation of CCP8 also affected as it ‘forced’ [us] to enter the new coming soon status, which can then go into pending off market within a day.”
While the NAR considered regulating “coming soon” properties as part of the CCP8, the organization ultimately left it up to individuals MLSs to regulate. In some MLSs, homes can be listed as “coming soon” for up to 21 days. However, according to the study, there is some concern that increased usage of “coming soon” status could cause the frequency of office exclusive listings to increase, again potentially causing a fair competition issue for the NAR.