The REALTOR® Association owners of REcolorado®, made up of the Denver Metro Association of REALTORS® (DMAR) and the South Metro Denver REALTORS® Association (SMDRA), have determined through a letter of agreement to sell the greater Denver MLS to a private entity outside of the real estate realm.
“First and foremost, we want to apologize that we were not able to share the news of what has now been reported in industry publications regarding the proposed sale of REcolorado,” the joint statement of DMAR and SMDRA read, which was provided to RISMedia by SMDRA CEO Melissa Maldonado. “Unfortunately, this information was disclosed in violation of a confidentiality agreement and legal practice of such negotiations.”
The 16th-largest MLS nationwide with 25,000 members, REcolorado’s administrators were surprised by the news to sell, having been previously approached by primary shareholders regarding negotiations to sell back in January, according to multiple media reports.
REcolorado and members of the MLS’ leadership team did not respond to requests for comment at press time.
“This is a decision that our respective associations agree will help provide expanded and improved service opportunities for metro-Denver REALTORS® and licensees, the members of our associations and REcolorado subscribers that depend on the MLS to provide the vital market information required to best serve consumers in their home buying and selling process,” the association statement said.
“Having completed our due diligence as shareholders, we feel confident in the Letter of Intent and that the proposed buyer has committed to the long-term operation of the MLS service for our professional brokerage community and that the resources of the MLS will be used to enhance the service offerings to all subscribers and that the company will not be resold,” the statement added.
REALTOR® Association owners said they believe that this is the right time to sell the MLS, with the real estate industry still continuing “to advocate decoupling from the REALTOR® Associations that have long owned the MLS.”
The statement from association owners also stated that decoupling MLSs and REALTOR® Associations may potentially protect MLSs from the ongoing antitrust litigation that has engulfed the real estate industry over the past year.
Many National Association of Realtors (NAR) members are asking the question, should we be considering leaving NAR as the parent organization of Realtors? Many Realtors feel abandoned by the antitrust lawsuits and NAR’s decision not to fight for its members. The DOJ/NAR’s proposed settlement has been established without great thought and lacks consideration for the future of an ever-changing real estate market. The mandatory provisions are within themselves, requiring setting a standard commission rate with buyers. Paragraph 58(vi) states that buyer agreements should “specify and conspicuously disclose the amount or rate of any compensation the MLS Participant will receive from any source”. It further states, “include a statement that MLS Participants may not receive compensation from any source that exceeds the amount or rate agreed to with the buyer”. That pretty much sounds like a set commission rate that cannot be negotiated. The problem with the DOJ/NAR lawyer’s attempts to disrupt a free market system is that market conditions are always changing. In the late 90s, during a buyer’s market, many sellers offered monetary bonuses to real estate agents that brought in a qualified buyer for their home. According to DOJ/NAR, such an offer would be illegal. That is our free market system! FREE MARKET defined – a system in which the prices of goods and services are determined by supply and demand expressed by sellers and buyers. Such markets, as modeled, operate without the intervention of government or any other external authority.” The question we should be asking is what are the qualifications of the individuals that sat at the negotiating table, and what were their motivations? This new rule is going to harm a great many people from accomplishing their desire to sell or buy a home. First-time buyers will again suffer greatly at the hands of this government. We need less government in our marketplace and November is our opportunity to send the message.