NAR Is Out of Its League
NAR finally responded to the Chicagoland blackout. The problem is that no one who matters has to listen.
Late last week, the National Association of Realtors published three short PDFs attempting to offer clarification and guidance on Clear Cooperation Policy (CCP) and the use of listing filters. In them, they try to bring greater definitions to “objective criteria,” “filtering,” and “one-to-one, broker-to-broker communication” — all issues that are genuinely at the heart of the debates and legal battles surrounding private exclusive listings and what/when listings must be displayed publicly.
Of course, NAR had to say something after 43,000 Chicagoland listings literally vanished overnight from the world’s most popular real estate site between May 20 – May 22. And to think, with NAR’s headquarters being in Chicago, this whole debacle played out in their own back yard.
But, if you were hoping for NAR to drop a hammer here, you’re going to be sorely disappointed. In fact, from the limited trade press surrounding their updated guidelines, you’d be hard-pressed to argue that NAR even dropped a feather. Which, in their defense, makes a lot of sense. Their once overflowing coffers have been all but drained by the onslaught of massive legal battles and losses over the past five years. When you’ve been kicked in the teeth over and over, one can hardly blame you for using extreme caution before stepping back into the ring.
My disappointment, therefore, is not that NAR has been unusually quiet and exceptionally slow to respond as the corporate giants Compass and Zillow duke it out.
My disappointment is that the little they have said is the loudest testimony to how impotent they are to lead their roughly 1.4 million agent members through these battles.
If NAR still believed it governed this industry, it would govern. It would name the line and — more importantly — name who’s crossed it. It would say, in plain words, this is what our rule means, and this conduct is out of bounds. But NAR didn’t do that. It published definitions. Typically, you don’t issue mere definitions of words and phrases when you have the authority to enforce the rules. You just enforce them. It’s when you can’t that you sharpen definitions and offer guidelines.
That said, especially in the situation with MRED and Zillow, NAR’s impotence isn’t owing to incompetence. It’s largely jurisdictional.
Yes, NAR writes the rulebook — Clear Cooperation, Policy 8.5, the “objective criteria” standard. But that rulebook only has binding authority over MLSs owned by Realtor associations. The MLS at the center of the Chicago blackout isn’t one of them. MRED is not an NAR-affiliated MLS, and when it cut Zillow’s feed, it said outright that the interpretation it was enforcing was its own — not NAR’s. Realtracs, the Nashville MLS running a nearly identical play, is built the same way. So the rule NAR so carefully “clarified” in those three PDFs is a rule NAR has no power to make MRED or Realtracs obey.
The distinction matters, because it’s the easy thing to get wrong. NAR isn’t an umpire who walked off the field in the middle of the game. It was never the umpire in this particular league. NAR runs one league — the MLSs owned by Realtor associations — and MRED plays in another. Same sport. A rulebook that reads almost word for word the same. But separate governance, separate authority, and a commissioner whose rulings reach about as far into MRED’s park as a Major League Baseball ruling reaches into Japan’s Nippon league. NAR can define “strike” in all the PDFs it wants. But, at least where it counts most today, you’re not going to find NAR standing behind that plate.
To be fair, NAR isn’t entirely powerless in MRED’s park — but its only lever runs through the players, not the league. A Realtor who uses MRED is still bound by the Code of Ethics. But MRED itself is not bound by any of NAR’s policy. It’s a thin lever. NAR can lean on an individual member, but it cannot rewrite an independent MLS’s rulebook. And when the only thing you can reach is the member and not the institution, ‘here are some definitions for our members’ is precisely the move you make. The thinness of the lever explains the thinness of NAR’s response.
On the contrary, MRED can discipline Zillow because Zillow is playing in MRED’s league. Since around 2021, Zillow isn’t just a website — it’s a licensed brokerage that takes listings through the IDX feed as a participating member. That move put them inside MRED’s rulebook instead of outside it. MRED is claiming that Zillow willfully broke its display rules — an offense that’s punishable by losing its right to the data feed. Of course, it’ll take a judge to determine if MRED’s claim is legitimate. But the point stands: in this case, it’s MRED who is responsible for enforcing the rules, not NAR.
On rule interpretation, there’s an irony worth flagging. The “objective criteria” rule MRED leaned on was born in the 2000s under Department of Justice pressure — built to force MLSs to share their listings with the internet brokerages they were then freezing out. It was designed to pry the data open. Twenty years later, MRED has turned it around and aimed it at the largest internet brokerage alive, to keep data closed. Same words, opposite purpose. The rule didn’t change; but the interpreter did. And whoever interprets the rule is the one who governs it.
Which raises the question: if NAR’s interpretation of the rules is not the final authority, whose is? As discussed in my Kingmaker piece, in a matter of weeks, Compass signed partnerships with four of the largest MLSs in the country — MRED, Realtracs, TheMLS/CLAW, and Bright MLS — covering Chicagoland, the South, greater Los Angeles, and the Mid-Atlantic. Compass complemented these partnerships with the pledge to subsidize MLS membership for as many as 100,000 of its agents at any of these Compass-aligned institutions. We all need to consider the implications of such a move: the largest brokerage in the country is now the most important customer, partner, and membership driver for several of the organizations responsible for interpreting and enforcing ‘the rules’ — whatever any of them intends by it.
I want to be careful here, because this is where it would be easy to cast Compass as the villain, and they aren’t. Put yourself in their seat. If the rules are written by a body that can’t enforce them and interpreted by MLSs that can, the rational thing — arguably the fiduciary thing — is to go make friends with the MLSs. To ‘butter-up the umpire.’ Compass is playing the game and taking full advantage of the game’s weaknesses to put themselves in the position of greatest strength. In that regard, it’s hard to hate them as the player. Instead, we must do as the schoolkids taught us and hate the game: specifically the parts that allow capturing the local rule-maker as the winning move.
In the case of MRED specifically, it’s hard to blame NAR. But where I do find fault is that NAR has been handing its authority away on purpose. Last November, at its NXT conference, it approved the most sweeping rewrite of its MLS Handbook in two decades — eighteen changes handing local MLSs more control over access and discipline, following its first-ever antitrust risk assessment, in what its own people more or less openly framed as a way to lower national legal exposure. Again, this is rational behavior given the legal losses they’ve taken over the past few years. But every inch of authority NAR sheds to protect itself is an inch that lands in the hands of whoever holds the most leverage in the room. They are not merely retreating from the field. They are quite literally giving it away.
So, no. I’m not disappointed that NAR was outside of MRED’s diamond. I’m disappointed that they appear positioned to walk off other diamonds — ones they should be standing on, yet seem unmotivated to defend.
And I’ll say the awkward bit plainly, because it’s the honest one. Over the past couple years, I have posted plenty of content explicitly wishing NAR would get out of the way, calling them gatekeepers and accusing them of being fundamentally self-interested at the expense of consumers. Even now, I write under the publication name Realtor Gone Rogue. So I am as surprised as anyone to feel a real sense of loss when the getting-out-of-the-way has finally arrived — and yet here I am, feeling it.
Why?
Because I think I had it wrong. I assumed that if the old umpire left, the ones who rushed in would be the open, transparent, consumer-first reformers — myself among them. They aren’t. What rushes into a game with no umpire isn’t fairness. It’s whoever is biggest. Strongest. And most capable of bending the rules to their own advantage.
For about forty-eight hours, forty-three thousand families in Chicago got a preview of that market. Their listings didn’t vanish because someone broke a rule. They vanished because two giants disagreed about what the rule meant — and the one body everyone still assumes is in charge had no authority in the league where it happened.
So NAR did the only thing left to it. It published three careful PDFs defining a strike zone it has no authority to call.
Which raises the more troubling question — the one those PDFs can’t answer:
Who is really behind the plate?
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I advise a select number of proptech founders, MLS leaders, and real estate organizations navigating industry change. My work focuses on stress-testing assumptions, identifying second-order effects, and helping teams think more clearly about strategy, policy, and implementation.