Regional Presence in Real Estate
Five Star Real Estate, an independent firm located in Onekama, Michigan, achieved 8,129 transaction sides in 2024. This performance secured them a spot within the top 50 of the RealTrends rankings. However, this figure was significantly lower than competitors like eXp Realty. CEO Paul Carlson highlighted that most transactions were concentrated in western Michigan, where Five Star maintains a strong market share.
While Carlson expresses confidence in the firm’s dominance in western Michigan, he raises concerns about competition in other markets. “If CCP falls and we go to private listing networks, companies will win where they are strong,” he stated. He noted that while Five Star holds a considerable advantage in western Michigan, its limited presence in states like Florida—having only 27 agents in the Tampa area—could hinder their performance in less familiar markets.
Moreover, Carlson worries about the visibility of Five Star’s listings in a landscape dominated by larger franchises with extensive networks. “If all Keller Williams or Anywhere Brands’ franchises combine their listings, that aggregation could overshadow our offerings, even if we outperform them in specific regions,” he explained. He fears that buyers may gravitate toward listings from firms with broader exposure, potentially affecting listing sales timelines and prices.
Challenges of Private Listing Networks
Linda O’Koniewski, broker-owner of Massachusetts’s Leading Edge Real Estate, voices strong opposition towards the emergence of private listing networks, suggesting it would set the industry back decades. “It would mirror the non-MLS systems seen in Europe, causing chaos for buyers and limiting sellers’ market exposure,” she expressed.
In the tight inventory market of Greater Boston, O’Koniewski believes that the limited visibility offered by private listings further complicates the buying process. “All buyers should have the same access to listings; increasing exclusivity creates inequalities,” she stated, emphasizing fair housing concerns.
Despite the potential for privacy through private listing arrangements, Michael Nourmand, president of Nourmand & Associates in Los Angeles, expresses similar fears. While he has worked with high-profile clients who prefer to keep properties off MLS for privacy, he warns that smaller brokerages might face disadvantages if private listings become prevalent. “They aren’t going to be able to see any of the inventory,” Nourmand cautioned. “They are totally up the creek without a paddle.”
Implications on Market Dynamics
In many neighborhoods, a small cadre of agents typically handles the bulk of listings, which can restrict exposure for newer agents and firms. Nourmand believes that this trend would inhibit market expansion opportunities for smaller entities if listing practices become more insular.
Ralph Harvey of ListWithFreedom.com, an online listing service that operates without geographical constraints, echoes these sentiments regarding the potential repeal of CCP. He noted, “If CCP is eliminated, it will be the death of small brokerages and the death of innovative brokerages,” citing concerns about market competitiveness.
The ‘Amazon Effect’ on Real Estate
Harvey likens the current market dynamics to the “Amazon effect,” where a dominant online retailer’s extensive inventory influences consumer choices. He argues that buyers will gravitate towards larger brokerages with extensive listings, sidelining smaller firms “even if it all isn’t what we are looking for.” This could undermine innovation and diversity within the industry as consumers prioritize quantity over local expertise.
Carlson shares this concern, apprehensive about how evolving dynamics might affect client relationships. “What happens to buyer agency when they choose an agent based on inventory, rather than trust and relationship?” he queried, posing critical questions about the future of agent-client interactions as brand influence increases in real estate transactions.
