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What's Happening in the MLS Legal World
CMLS is focused on ensuring you have the most current and relevant information to lead your organizations today and into the future. Last week's Legal Seminar featured real estate attorneys and speakers who shared a wealth of knowledge on current legal issues impacting MLSs. The topics included developments in ongoing litigation, changes to MLS ownership structure, strategic state law changes, and the impact of generative AI.
What we learned and what was shared:
- Major class-actions continue to work their way through the courts as allegations related to compensation rules in MLS persist. Presenters provided updates on pertinent procedural updates and summarized key filings, including arguments being made, and court determinations about them.
- Panelists engaged in a fascinating discussion about what the landscape for MLSs may look like in the future. Speakers stressed that there are many possible outcomes that may result whether plaintiffs or defendants prevail, if industry lawsuits are settled, or if there is regulatory intervention.
- In considering the future of MLS, a brokerage community representative discussed opportunities that may present themselves to improve the real estate transaction and marketplace for consumers. Such opportunities include MLSs looking for way to support broker innovation and flexibility in their business models.
- Speakers reviewed the role of REALTOR® associations and MLSs, and the interplay with NAR mandatory rules. A discussion regarding MLS’s corporate ownership structure examined adjusting association-MLS business structure.
- Presenters discussed that MLS rule changes are an industry opportunity to improve MLS’s value proposition to brokers and consumers. MLSs can be empowered to make changes now to further consumer involvement, transparency, and flexibility in negotiating commission. Specific rule changes include making offers of compensation optional and changing how compensation is paid.
- The efforts related to a recent update to Washington’s real estate agency law to include a requirement that brokers enter into a written services agreement with a buyer were discussed. Bright MLS has produced a model template law to facilitate best practices into the state adoption of a real estate consumer protection law.
- Speakers discussed developments in generative artificial intelligence tools and how that may shape MLS, content, and data. Generative artificial intelligence tools are rapidly developing and have big potential.
- The economic firm retained by CMLS discussed CMLS’s latest effort in championing the value of the MLS and articulate that value at the national level. The speaker did a deep dive into the blueprint for data and trends to determine how MLSs help consumers and create an efficient marketplace. This will allow CMLS and MLSs to have a concrete way to demonstrate its value.
Other key takeaways:
- While the current legal environment is unsettled, there are many opportunities for MLS to continue to focus on serving the brokerage community and consumers by providing complete, accurate, and timely data encouraging the network effects and transparency that are touchstones of MLS.
- MLS should continue to advocate for their value proposition.
- MLSs may consider using the current environment as a catalyst to reflect on current practices and position itself as a forward-thinking organization that can serve brokers and consumer effectively in the future.
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