The residential real estate industry is currently embroiled in a high-stakes debate centered on two conflicting figures: 4.6% and 1.3%. For listing agents and homeowners, these numbers represent the difference between a significant profit and a substantial loss, depending on which data set one believes. At the heart of this controversy is the practice of "private listings"—properties marketed within a specific brokerage or a closed network rather than being published on the Multiple Listing Service (MLS). While the industry has long debated the merits of off-MLS marketing, the conflict has moved beyond marketing departments and into the halls of the United States Congress, where lawmakers are questioning whether these exclusive networks are harming consumers and stifling competition.
Federal Oversight and Congressional Inquiry
The escalation of this issue into a matter of federal concern began in late July 2024. On July 22, the House Judiciary Committee’s antitrust subcommittee, led by Chairman Scott Fitzgerald, dispatched formal inquiries to Robert Reffkin, CEO of Compass, and Rebecca Jensen, CEO of Midwest Real Estate Data (MRED). The letters demanded a briefing on the nationwide private listing network partnership between the two entities, with a deadline of August 5.
Lawmakers are specifically investigating whether these private networks function as a mechanism for brokerages to insulate themselves from broader market competition. The primary concern cited by the committee is the potential for "steering," a practice where agents might prioritize keeping a transaction within their own brokerage to capture both sides of the commission (representing both buyer and seller), rather than exposing the property to the widest possible pool of buyers on the open market.
The pressure intensified on August 6, when Senator Elizabeth Warren entered the fray. In a letter addressed to both Compass and MRED, Senator Warren requested exhaustive details regarding the expansion of their private listing partnership. Her concerns were multifaceted, touching on the lack of transparency in "hidden inventory," the potential for weakened pricing data due to a lack of public comparables, and significant fair housing risks. Senator Warren has requested a formal response by August 21, signaling that the scrutiny of private real estate networks is becoming a bipartisan priority in Washington.
The Case for Private Exclusives: The Compass Perspective
In the face of mounting regulatory pressure, Compass has aggressively defended its business model using internal data. The brokerage, which has grown rapidly to become the largest independent brokerage in the U.S. by transaction volume, recently released a study analyzing 70,809 of its own closed transactions between April 2025 and March 2026.
According to Compass, the data supports a "phased marketing" approach. This strategy involves listing a home as a "Coming Soon" or "Private Exclusive" within the Compass network before eventually moving it to the MLS. The study concluded that homes marketed this way sold for an average of 4.6% more and moved 34% faster than homes placed immediately on the open market.
Dave Crosby, Chief Data Officer at Compass, argued that this approach allows homeowners to build anticipation and refine pricing strategies based on initial feedback from a curated group of agents and buyers. From this perspective, private listings are not a tool for exclusion, but a sophisticated marketing tactic that benefits the seller by creating an aura of exclusivity and allowing for "price discovery" before a property’s "days on market" counter begins on public portals.
The Case for Maximum Exposure: Zillow’s Contradictory Findings
The narrative presented by Compass stands in stark contrast to research conducted by Zillow, the nation’s leading real estate marketplace. Zillow’s business model relies heavily on the aggregation of all available listings to drive traffic and advertising revenue, giving the company a vested interest in the preservation of the open MLS system.
Zillow’s study, which examined more than 15 million sales occurring between 2023 and 2025, painted a much grimmer picture for sellers who bypass the MLS. The research found that homes kept off the MLS typically sold for 1.3% less than comparable homes on the open market. In aggregate, Zillow estimates that this "off-market penalty" cost American sellers approximately $1.36 billion over the three-year period.
Furthermore, Zillow’s data highlighted a social equity component to the debate. The study found that lower-priced homes saw a larger price reduction—roughly 2.2%—when kept off the MLS. Perhaps most concerningly, homes in communities of color lost 1.9% of their value when marketed privately, compared to a 1.1% loss in majority-white neighborhoods.
Zillow’s Chief Economist, Mischa Fisher, emphasized that the best way to ensure a fair price is through maximum exposure. The study also took aim at dual agency—where one agent or brokerage represents both sides of the deal—finding that such transactions cost sellers an additional $1.49 billion in potential value.
Independent Research and Historical Context
The debate over private listings is not new, and independent academic research has historically sided with the "maximum exposure" camp. A landmark analysis conducted by Bright MLS in conjunction with Drexel University examined over one million sales. That study found that homes listed on the MLS sold for approximately 17.5% more than comparable off-MLS homes. For the typical seller, this represented a difference of roughly $54,000.
The tension between private networks and the MLS reached a boiling point in 2019 when the National Association of Realtors (NAR) implemented the "Clear Cooperation Policy" (CCP). The policy requires listing brokers to submit a property to the MLS within one business day of marketing it to the public. However, various workarounds, such as "Office Exclusives," have allowed brokerages like Compass to continue operating internal networks.
The current congressional inquiry is effectively a challenge to these workarounds. Lawmakers are questioning whether the spirit of the Clear Cooperation Policy is being undermined by large brokerages attempting to create "walled gardens" of inventory that only their clients can access.
Chronology of the 2024 Private Listing Conflict
To understand the current state of the industry, it is helpful to look at the timeline of events that led to this summer’s legislative and data-driven clash:
- April 2025 – March 2026 (Projected/Reported Period): Compass conducts an internal study of nearly 71,000 transactions to evaluate the efficacy of phased marketing.
- May 14, 2026: Zillow releases its comprehensive study of 15 million sales, highlighting the financial losses associated with off-MLS listings and dual agency.
- July 22, 2024: The House Judiciary Committee’s antitrust subcommittee sends letters to Compass and MRED, initiating a federal inquiry into private listing networks.
- August 5, 2024: Deadline for Compass and MRED to brief the House Judiciary Committee staff.
- August 6, 2024: Senator Elizabeth Warren sends a separate inquiry to Compass and MRED, citing concerns over fair housing and market consolidation.
- August 21, 2024: Deadline for Compass and MRED to respond to Senator Warren’s detailed list of questions.
Analyzing the Corporate Incentives
In a professional real estate environment, data is rarely neutral. Both Compass and Zillow are public companies with fiduciary responsibilities to their shareholders, and their research often reflects their underlying business strategies.
Compass is positioned as a high-end, tech-enabled brokerage. Its "Private Exclusives" program is a key selling point for recruiting top-tier agents and attracting luxury sellers who value privacy. If Compass can prove a 4.6% premium, it justifies its model and encourages more "in-house" deals, which are more profitable for the firm.
Conversely, Zillow’s platform is only as valuable as the data it contains. If a significant portion of the housing inventory moves into private, brokerage-specific networks, Zillow’s search results become incomplete, and its utility to consumers—and therefore its advertising value—diminishes. By highlighting a "billion-dollar penalty" for off-MLS sales, Zillow is defending the open-market ecosystem that sustains its revenue.
Implications for Fair Housing and Consumer Choice
Beyond the corporate skirmish, the congressional interest in this matter suggests deeper societal implications. The primary concern for regulators like Senator Warren is that private listings create a two-tiered real estate market. In a "walled garden" scenario, only those who are already "in the know" or represented by a specific high-end brokerage have access to the best inventory.
This lack of transparency has direct ties to Fair Housing Act concerns. If homes in certain neighborhoods are only marketed through private channels, it can inadvertently (or intentionally) exclude certain protected classes from seeing those homes, thereby reinforcing patterns of residential segregation.
Moreover, the "steering" concern raised by Representative Fitzgerald strikes at the heart of the fiduciary duty agents owe to their clients. If an agent encourages a seller to keep a listing private primarily so the brokerage can collect a "double-ended" commission, they may be placing their own financial interests above the seller’s need for the highest possible offer from the open market.
The Path Forward for the Real Estate Industry
As the August deadlines pass and the House and Senate committees review the responses from Compass and MRED, the real estate industry stands at a crossroads. The outcome of these inquiries could lead to stricter federal regulations on how "Office Exclusives" are handled or even a complete overhaul of the National Association of Realtors’ policies.
For real estate professionals, the immediate takeaway is the necessity of radical transparency. Agents must be able to explain the pros and cons of both marketing strategies without bias. The "Coming Soon" status can be a powerful tool for generating buzz, but "permanently off-market" status carries risks that must be documented and disclosed.
The "Powerfact" for the industry remains clear: A study is often only as neutral as the entity funding it. Sellers must be presented with the full spectrum of data—from the 4.6% premium claimed by internal brokerage studies to the 17.5% gain suggested by independent academic research.
In the coming months, as the legal and legislative processes unfold, the definition of "market value" may be redefined. If the government determines that private networks are anti-competitive, the industry may see a forced return to the total transparency of the MLS. Until then, the battle between the "exclusivity" of the private network and the "exposure" of the open market will continue to be the most contentious issue in American real estate.
