The nationwide expansion of large multiple listing services in recent days could signal an acceleration of MLS consolidation — and intensify competition among entities that previously operated in relative silos, industry experts said.
Late last month, MRED — the MLS serving Chicagoland — announced it was expanding its Private Listing Network nationwide. Then last week, Nashville-based Realtracs followed suit, announcing that it would offer access to agents far beyond its hometown in partnership with Compass and United Real Estate.
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The signal comes amid an intense and ongoing period of MLS consolidation, where entities of all sizes are merging and shrinking the number of MLSs nationwide. With major MLSs expanding beyond their cores, that trend may accelerate.
Eric Stegemann | CEO, Solid Earth
“The big are going to get bigger. The smaller ones are probably going to have to decide what’s next,” Eric Stegemann, CEO of Solid Earth, told Inman. “That might mean mergers and folding into a large organization.”
Nearly half of the nation’s MLSs have vanished since 2015, according to data from T3 Sixty. And executives from the biggest brokerages and MLSs have called for still more drastic consolidation.
They appear to be gradually getting what they want. Case in point: In mid-April, BeachesMLS and MIAMI MLS announced a merger that would create one of the largest multiple listing services in the nation once it’s completed.
The industry might not quite be at the point where a small handful of large MLSs can strongarm small MLSs into merging or folding altogether, though.
“It seems a stretch at this point in time for any large MLS to say, ‘OK we’re going to get listings from Compass and some other big players and therefore we’re going to become national,’” said industry veteran Russ Cofano, “and for that to displace the need for a local MLS who has a critical mass of listing inventory.”
“Could we get to that spot? Sure we could,” Cofano added. “But that would require a lot more than just Compass and United and several of the other big players to tip the scales to a point where membership in the local, the legacy, local MLS is no longer necessary.”
Also in the background is the roiling debate around where, when and how listings are marketed.
Russ Cofano
Compass International Holdings has led the charge against what it says are rigid MLS rules governing pre-marketing listings. The megabrokerage has been pushing to allow its agents to follow its 3-Phased Marketing Strategy, which starts listings as Compass Private Exclusives before giving them Coming Soon status. The final phase sends listings to the wider market via the MLS.
Compass previously battled Zillow when the portal enacted and began enforcing a policy that sought to block brokerages from pre-marketing listings without distributing them widely via the MLS, Zillow and other portals.
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Compass CEO Robert Reffkin floated the idea in February that there should be one single MLS co-owned evenly by all brokerages. The idea was a response to what Reffkin said were MLS rules that restricted agents’ ability to do their jobs. Compass has also backed the nationwide expansions of MRED and Realtracs, partnering with both in the effort.
Joe Rath, head of industry relations at Rocket, said the nationwide expansions indicated that competition among MLSs was heating up quickly, which he said was a good thing for agents and their clients.
Joe Rath | Rocket
“It’s still early. But this is a structural shift,” Rath recently wrote in a LinkedIn post. “Competition among MLSs has the potential to reshape how listings are shared, marketed, and discovered. More broadly, it raises a question the industry hasn’t had to seriously consider before: what does the infrastructure for buying and selling homes look like when the old boundaries no longer hold?”
Mike Conway is vice president of sales and marketing for Systems Engineering, Inc., the company behind the Navica MLS platform. The company specializes in serving approximately 100 small- and medium-sized MLSs, down from about 150 over a decade ago.
Conway acknowledged that MLS consolidation has happened and will continue. But he said small markets are defensive and unique from larger markets. He highlighted the persistence of Savannah, Georgia’s MLS not merging with FirstMLS or Georgia MLS as evidence of a desire for some small MLSs to remain independent from larger ones.
Still, the wave of consolidation will continue, Conway said.
Mike Conway | Navica
“There’s all these mega, huge MLSs out there. That’s happened and that also has gotten rid of some of the smaller MLSs,” Conway said. “This is probably inevitable at the end of the day. The best they can do is probably get down…to maybe 50 MLSs. One per state.”
