Darryl Davis writes about how a new state bill could reshape the private property discussion and change the way sellers do business.
There’s a bill that almost no one is talking about that would change the way you list a home in New York.
On May 29, the New York State Assembly passed the Fair and Transparent Real Estate Listing Act, which was passed by the Senate on June 1. It is now on its way to New York Governor Kathy Hochul’s desk. It quickly became a hot topic when it was announced in March, but has since fallen silent. The really important part, the part where both houses pass, passed by almost unnoticed.
So let’s talk about what it means to sit down at your kitchen table and earn a list.
Within one calendar day of signing a listing agreement, your home must be listed for sale on the MLS or public site, where anyone can view it for free without having to call. You’ll also need to share your listing with a buyer agent who can ask questions, answer questions, and show you.
Simply put, the clock starts the moment the ink dries and the house goes to a place where the entire market can see it.
Impact on quiet listing
This is a bill that privately listed companies are paying close attention to. You know the pitch. If you stay quiet, test prices, and sell with a little buzz before officially hitting the market, it won’t stay on the market for days or have a history of price drops.
Compass built an entire engine around that idea. So it’s a three-stage marketing strategy: first private, then Compass Coming Soon, and then general release.
The New York bill goes straight for the quieter parts. If the home is on a private or restricted access channel, you must also sell the home publicly. Not later. at the same time. That one word wipes out any head start. If a noisy phase must occur on the first day, there is no quiet phase.
And there’s already reason to question how well that quiet phase will work for sellers in the first place. In its legal battle with Compass, Northwest MLS used Compass’ own marketing materials and argued that listings failed to sell in the private phase about 95 percent of the time before being pushed to MLS. Read that number twice.
Soft launches usually don’t close deals. It only delays the real thing.
Form to give to seller
Now, this bill does not completely prohibit quiet listings. Sellers can opt out. However, there is a big pitfall here. To do so, the seller must sign a disclosure form prepared by the state. The disclosure statement would write one line at a time in plain language that going private could mean fewer buyers looking at the home, fewer offers, and potentially a lower price.
Please sit there for a moment. You’re sitting across the table explaining why discreet off-market sales are a smart choice, while New York State is giving those same homeowners a piece of paper that looks like a warning label on a cigarette pack. I can still go on the pitch. All you have to do is watch your client sign a document making the case for the other side.
It changes the conversation and you want to go into the field knowing that.
This isn’t just a New York story.
Even if you’ve never sold a home north of the Hudson River, be aware that the ground is changing everywhere. Inman is following a wave of states seeking to restrict private listings, with bills in place in states like Connecticut and Hawaii. What was once a debate within MLS committee chambers is becoming actual state law, and state law affects licenses as well as fines from local boards.
There is also some solid data that speaks volumes. An analysis by the Consumer Policy Center interviewed by Inman found that Compass is keeping both ends of its trade in-house at 41% in Washington, D.C., compared with a historical range of 3% to 12%. When numbers spike like this, lawmakers notice, and the findings section of this bill reads as if it was written with that report open on their desks.
what to do with this
There are two things you must always follow. This is not yet a law. Don’t go tell sellers the rules changed yesterday because they still need the governor’s signature. But a bill passing both chambers in a market of this size is more than background noise. This is a preview of the exam.
So, be proactive. Read the actual bill, not the summary summary. Rehearse your conversation now. A conversation explaining the day clock and opt-out form before the seller hears an indistinct voice from a neighbor.
And ask yourself the question that underlies all of this. Is your value the fact that you control who can see your listing, or is it the pricing, judgment, and negotiation you bring after it’s published? The second option is the only one worth building a career on, and it’s a choice that no law can take away from you.
Quiet listings have always borrowed against the public market. New York is calling for financing.
Note: An earlier version of this article incorrectly identified the Consumer Policy Center analysis as coming from the Consumer Federation of America.
