Unrepresented FSBOs Can’t Be Listed on REALTOR.COM

Image via CrunchBase

A Couple of days ago, a press release was sent out that said , in part

NEW YORK, Nov. 12, 2008 – ForSaleByOwner.com today announced that it has become the nation’s first “by owner” real estate website to enable home sellers to advertise their home on Realtor.com without appearing on a local Multiple Listing Service (MLS). This new direct access to Realtor.com follows the May 2008 settlement between the U.S. Department of Justice and the National Association of Realtors.

“The DOJ-NAR settlement benefited consumers by giving them access to Realtor.com without the expensive cost of a commission fee,” said Greg Healy, Vice President of Operations at ForSaleByOwner.com. “We’re proud to be the first to offer this new consumer-friendly access to Realtor.com. In today’s challenging housing market, sellers need cost-saving ways to sell their homes.”

“Our typical home seller saves nearly $13,000 in commission and this new access to Realtor.com will help even more people sell their home without using the services of a real estate agent,” added Healy.

Realtor.com is a popular real estate website that attracts nearly five million monthly visits. The new Realtor.com Showcase Listing service from ForSaleByOwner.com will allow sellers to have their homes marketed on Realtor.com, and interested buyers will be able to directly contact these sellers.

The press release generated a ton of interest in real estate circles. Agents were stunned, and the connection between the National Association of REALTORS and REALTOR.COM (the official Web site of the National Association of REALTORS® operated by Move Inc) generated astonished and angry reactions from real estate professional all over the country.

In fact, the press release was inaccurate, self-serving, and misleading. It referenced the NAR/DOJ settlement earlier this year as if that was the source of the relationship between the company and REALTOR.COM, indicating that unrepresented sellers would now be able to list their properties through the company and have the properties exposed on REALTOR.COM. The truth was forthcoming shortly when the following information was provided by NAR, but the RE.Net being what it is the truth has to battle back against the first onslaught of inaccurate information.

Here are the clarifications NAR and REALTOR.com published to set the record straight 

1) The settlement agreement between NAR and the U.S. Department of Justice made no provision to allow unlisted properties, such as “for-sale-by-owner,” to be posted on REALTOR.com.

2) ForSaleByOwner.com does not in any way enable home sellers to advertise their home on REALTOR.com without broker representation; every property on REALTOR.com must be listed by a licensed real estate broker.

3) REALTOR.com has not authorized ForSaleByOwner.com to resell REALTOR.com’s Showcase Listings Enhancement package.

4) There is no relationship between ForSaleByOwner.com and REALTOR.com.

5) There are no unrepresented homes on REALTOR.com. Every property on REALTOR.com must be listed by a licensed real estate broker, and unrepresented properties would not qualify to be submitted to a REALTOR®-owned and operated MLS.

REALTOR.com® has asked ForSaleByOwner.com to issue a retraction. ForSaleByOwner.com did not discuss in advance the statements in its press release with REALTOR.com® nor did it request or receive permission to use the REALTOR.com® name in its press release.

I would be more upset about the misrepresentations made by Forsalebyowner.com if I did not have a low personal opinion about their marketing strategies to start with. However I guess that if they position themselves as some sort of consumer advocates, the truth isn’t as important to them as it is to the rest of the real estate practitioners around the country.