Private Listing Networks Suppress Information About Housing Supply & Cause Harm To Home Buyers
By David Carlucci
Most real estate agents work for brokerages, which connect sellers with buyers and buyers with sellers.
In a given city or region, brokerages usually share their listings through online databases called multiple listing services (MLS). Think of these like bulletin boards — which is what they originally were back in the early 1900s.
Today, sites like Zillow and Redfin aggregate listings from various MLSs, so you don’t have to go through a realtor to see all the options in your area.
New York City operates a little differently. Unlike most major housing markets, it doesn’t rely on a single, traditional MLS. Instead, platforms like StreetEasy serve a similar purpose, giving buyers and renters a centralized place to browse publicly advertised properties from competing brokerages.
But the underlying principle is the same: the more listings that are publicly accessible, the easier it is for consumers to compare their options and for sellers to reach potential buyers.
The brokerage market has become increasingly concentrated. In January, the largest U.S. brokerage, Compass, which controls roughly 80% of the Manhattan market, finalized its merger with the second-largest, Anywhere. The post-merger Compass now controls 30% or more of local brokerage markets nationwide. In Manhattan, it handled over 80% of real estate deals in 2024.
Compass is also leveraging its newly increased market dominance to create private listings networks, which keep homes off the MLS database and show them only to authorized subscribers.
How do private listing networks hurt homebuyers?
The answer is simple economics. If brokerages can keep some homes off the MLS databases — and off the listing aggregation sites they feed into — they end up with the same number of buyers bidding for fewer homes. In other words, demand holds steady while supply goes down, which leads inevitably to higher prices.
Families are already struggling to achieve the American dream of homeownership. Four decades ago, the median home cost around 4 years worth of median household income. Today, that same family would have to work almost 7 years to afford a home, a ratio we haven’t seen since the height of the late-2000s housing bubble. Interest rates are also way up, topping 7% multiple times in recent years for the first time since 2002.
Under these conditions, the last thing aspiring homebuyers need is additional upward pressure on home prices.
Compass knows how lucrative the expansion of private listing networks can be, which is why they’re offering New York City realtors financial incentives to remove their listings from StreetEasy.
And it’s not just New York. Earlier this year, Compass partnered with Midwest Real Estate Data (MRED) to take the Chicago-area MLS’ private listing service nationwide.
Can they be stopped?
Thankfully, politicians have noticed what Compass is up to.
“Your partnership threatens to create a two-tiered housing market where insiders pay for exclusive access to housing inventory and market data, while everyone else is shut out,” Sen. Elizabeth Warren (D-MA), the ranking member of the Senate Banking, Housing, and Urban Affairs Committee, wrote to Compass and MRED in August. “I am concerned that this move will increase industry consolidation and harm consumers by driving up housing costs and worsening inequalities in the housing market.”
And it’s not just Democrats raising the alarm. Rep. Scott Fitzgerald (R-WI), who chairs the House Judiciary Committee’s Subcommittee on the Administrative State, Regulatory Reform, and Antitrust, also wrote to the two companies in July, demanding answers about “anticompetitive practices designed to insulate themselves from competition at the expense of consumers.”
At the state level, New York Attorney General Letitia James is on the case. Her investigators have already spent months looking into whether Compass’ merger with Anywhere violates state antitrust laws. If the AG’s Office determines it has, the company could face litigation, fines, and even a forced breakup.
The housing market is in a bad place right now. We need a huge influx of new supply that, despite the promising passage of the 21st Century ROAD to Housing Act, probably won’t arrive any time soon. But even if a quick solution remains out of reach, the least our elected leaders can do is protect healthy competition and stop monopolistic abuses from making the situation even worse. That’s what Warren, Fitzgerald, and James seem to be doing, and hopefully more lawmakers and state AGs will join them soon.
David Carlucci consults organizations on navigating government and securing funding. He served for ten years in the New York Senate.
