The discount brokerage is now a member of six multiple listing services, but says it’s still avoiding ‘traditional’ agent fees by offering a low cooperating commission when it submits listings.
Six years after launching as a discount real estate brokerage that operates outside of multiple listing services, REX Real Estate has become the latest self-described industry disrupter to acquiesce to the power of the status quo: REX is now an MLS subscriber.
The brokerage joined half a dozen MLSs between late September and early November 2021, REX General Counsel Michael Toth told Inman via email. The MLSs are California Regional MLS; MetroList in Sacramento, California; GEMLS in Bakersfield, California; FMLS in Atlanta; REcolorado in Denver; and Northwest MLS in Washington.
REX sued the National Association of Realtors (NAR) and Zillow in March 2021, alleging antitrust violations for a NAR rule that prompted Zillow to separate non-MLS listings from MLS listings on its website, including listings from REX. NAR countersued last week, alleging in part that REX had misrepresented its business model.
About a year ago, REX began co-listing some of its listings with other brokerages that were MLS participants in order to have them appear more prominently on Zillow’s website, but this is the first time the brokerage has directly joined MLSs itself.
Asked whether REX had decided to do so in order to have its listings appear with other MLS listings on Zillow, to find buyers for its listings, or because sellers asked for their listings to be in the MLS, Toth said, “The reason we’re in the MLS is that NAR basically put a gun to our head.
“NAR’s segregation rule fundamentally deprives consumers of choice and digital access to homes marketed directly to the public. Our recent decision to begin listing on the MLS was out of necessity and started in late 2021.
“REX bypasses traditional fees by standing up for consumers who do not want to give away money under NAR’s plainly unlawful mandatory commission rules. We’re in a handful of MLSs at present, none of which requires NAR membership. NAR and Zillow’s collusion has had real harm on real estate consumers everywhere. That’s why we’re fighting so hard to open up the industry to real competition.”
At least two of the MLSs that REX joined are owned by Realtor associations (GEMLS and REcolorado), but REX has not joined any Realtor associations, according to Toth.
“What’s unthinkable in other industries is the norm in real estate,” Toth said. “No other industry links your job with membership in a private trade association.”
In response to REX joining some MLSs and its stated reasons for doing so, NAR spokesperson Mantill Williams told Inman, “Quite simply, consumers hire brokers who participate in their local, independent broker marketplaces because American homebuyers and sellers appreciate the efficiency, transparency, choice, value and pro-competitive benefits those marketplaces offer.
“After all, local broker marketplaces level the playing field for both consumers and brokerages, and provide the vast majority of digital access to homes marketed to the public.”
REX’s website indicates that the brokerage made the change at least in part due to consumer feedback. “You spoke, We listened,” the brokerage’s home page says.
“At REX, you’ve been trusting us to help buy or sell your home for years,” the page continues. “We recognize that opportunity is everywhere, which is why we’ve decided to begin listing on the MLS — all while still bypassing traditional agent fees, saving you money.”
Asked whether REX is bypassing those fees in the MLSs it has joined by offering a low cooperating commission when it submits a listing to an MLS, Toth said, “That is correct!”
He declined to specify how much REX is offering buyer brokers, instead indicating that it is up to REX’s seller clients.
“REX’s mission is to expand choice,” Toth said. “We understand the value that agents add, but have never understood why NAR rules force sellers to pay for a service that buyers receive. Mandatory preset commissions harm consumers and agents alike.
“Sellers need to know that if they offer a full going rate commission, they are giving away all leverage to negotiate a better deal. Sellers also need to understand that if they offer commissions below the going rate, there’s going to be steering away from the home as a result of NAR’s mandatory commission rules. We present to our customers the full spectrum of options and empower our sellers to feel confident that whatever commissions they offer, a dedicated and caring REX agent will support them and work for them to sell their home.”
Asked whether REX plans to join any other MLSs in the 19 states it operates in, Toth said the brokerage would do what was best for its consumers.
“Real estate consumers are the ultimate victims of NAR’s outdated rules,” he said. “As we constantly assess the results of our efforts to reset real estate around the consumer, we will continue to look at creative ways to serve all buyers and sellers. How we engage going forward will be based on a variety of market factors, but always with one principle in mind: how can we expand choice and transparency for consumers.”
Email Andrea V. Brambila.