Why Bright MLS's decision to allow $0 buyer broker commissions is a bold and smart move

The real estate industry is facing a major legal challenge from two class action lawsuits, known as Moehrl and Sitzer, that allege that the industry's commission practices and policies are anticompetitive and harm consumers. The lawsuits claim that the industry's standard practice of requiring home sellers to pay a buyer's agent commission as a condition of listing their homes on the MLS is illegal and inflates the cost of buying and selling homes.

The National Association of Realtors (NAR), which represents the interests of the industry and its members, has been trying to defend its commission practices and policies, and has reached a settlement agreement with the Department of Justice (DOJ) that requires NAR to modify some of its rules and policies. However, the DOJ has recently withdrawn from the settlement agreement, and has resumed its probe into NAR's antitrust violations.

In this context, Bright MLS, the nation's second-largest MLS, has made a surprising and significant decision to allow its users to put in a blanket offer for buyer brokers, including an offer of zero dollars. Previously, the lowest allowed amount was one cent, so it is a very small change in terms of dollars and cents, but a huge one in terms of transparency and flexibility.

Bright MLS's decision breaks with NAR's policy on commissions, which states that "the listing broker shall specify on each listing filed with the service the compensation offered to other MLS participants for their services in the sale of such listing." This policy implies that listing brokers must offer some compensation to buyer brokers, even if it is only one cent.

Bright MLS's decision also diverges from NAR's preferred approach to deal with the legal challenges to its commission practices and policies, which is to maintain the status quo and resist any changes that could undermine its influence and profitability in the industry.

However, Bright MLS's decision is not only a bold move, but also a smart one. It shows that Bright MLS is responsive to the needs and preferences of its users and consumers, who may want more transparency, flexibility, and efficiency in their real estate transactions. It also shows that Bright MLS is proactive and innovative in adapting to the changing legal and market conditions, and in creating more choices and opportunities for its users and consumers.

Bright MLS's decision may also have some positive effects on the industry and its stakeholders. It may reduce the legal risks and liabilities for listing brokers who may face lawsuits or sanctions for violating antitrust laws or the settlement agreement. It may also empower home sellers to negotiate lower commissions or opt for alternative services that charge flat fees or offer rebates. It may also create more competition and innovation among buyer brokers who may have to justify their value and compete for clients.

Bright MLS's decision may also have some challenges or drawbacks. It may face resistance or backlash from NAR or other MLSs who may disagree with its decision or fear losing their membership or market share. It may also face confusion or uncertainty from its users or consumers who may not understand or appreciate its decision or its implications. It may also affect the role and compensation of buyer brokers who may lose income or clients.

Therefore, Bright MLS will need to communicate and explain its decision clearly and effectively to its users and consumers, and provide them with guidance and resources on how to comply with its rules and policies. It will also need to monitor and evaluate the impact of its decision on its operations and revenue, and adjust or improve its rules and policies as needed. It will also need to engage and collaborate with other MLSs and industry partners to address any common issues or opportunities arising from its decision.

Bright MLS's decision to allow $0 buyer broker commissions is a bold and smart move that reflects its vision and leadership in the real estate industry. It is a move that challenges and improves the industry's commission practices and policies, and provides value and service to its users and consumers.  It is a move that deserves recognition and support from the industry and its stakeholders.


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