Hanna’s move to limit listings: Conversation starter or something more?
The country’s largest independent brokerage recently pulled out of IDX in the Cleveland area, touching off widespread discussion. Will its approach catch on?
- Howard Hanna’s CEO said the change will give the company’s agents more control.
- Some industry observers see this as an understandable response to brutal market conditions.
- Redfin — a brokerage seen by many consumers as a home search portal — no longer receives Hanna listings and says the move is bad for would-be buyers.
After Howard Hanna changed the way it distributes listings in the Cleveland area, its CEO said he expected a discussion. Weeks later, the debate rolls on.
And the biggest question: What's next?
The family-owned brokerage recently pulled out of IDX — the feed commonly used to share listings with MLSs — which will limit the ability of other brokerage sites to display Howard Hanna listings. The company is working to establish direct feeds to major non-brokerage real estate search portals.
In an interview, CEO Hoby Hanna said this change will give his agents more control over their listings, and if it works in the Cleveland area, Hanna believes it could catch on elsewhere.
"There are some companies much bigger than us that might be able to take this premise and really change on a larger scale," Hanna said.
It has certainly led to some lively discussions among industry observers and real estate professionals on social media, with some applauding the move and others cautiously waiting to see if Hanna's decision will pay off.
An apt response to a tough market
Hanna's decision to test this move during a down economy isn't too surprising, said Russell Smith, president and COO of the digital platform Earnnest, during a June 26 Twitter Spaces discussion hosted by real estate entrepreneur Greg Robertson.
"We are in a really tough market right now. In these markets… it can't be business as usual," said Smith, adding that he understands how a brokerage like Howard Hanna would use its listings to pursue partnerships, much like other companies do. "At the end of the day, this is about them growing their market share… [and] navigating through the worst market any of us has seen in a long time."
Rob Hahn, real estate consultant and managing partner of 7DS Associates, noted in his most recent substack post that the value of IDX is convenience in terms of getting the listings out there, but that doesn't have to be the only choice.
Ultimately the listing broker can control how listings are handled, "as long as the seller approves of whatever marketing strategy the listing broker chooses to pursue," Hahn wrote.
Michael Corley, a Brooklyn-based broker, said in a Twitter thread that IDX has created "market inefficiencies," and Hanna's departure "could signal the beginning of real market competition among [real estate] practitioners."
Bad for buyers?
The companies that stand to lose out are the brokerages operating in Cleveland who will no longer be able to display Howard Hanna listings. One of those companies — Redfin — believes buyers will lose out too. Redfin, the third most trafficked real estate portal and a brokerage with agents in the area, is no longer getting a direct feed of Howard Hanna listings in the Cleveland area because of its brokerage ties.
In a statement issued through a spokesperson, Redfin said it was disappointed by the move, noting that in transactions where Redfin represented the buyer on a Howard Hanna listing in Cleveland, 90% got to closing. Howard Hanna has contended that getting a home to closing would be better through the VOW system.
"Howard Hanna's decision to restrict other brokers like Redfin from displaying its customers' listings on our websites and mobile applications will limit how many buyers see those listings," the company said.
"Losing access to those buyers can't be best for Howard Hanna's listing customers. We're disappointed in this decision, however, we'll continue to work cooperatively with Howard Hanna's agents to successfully close transactions with our buyers and sellers," Redfin added.
Correction: An earlier version of this story referred to Russell Smith as CEO of Earnnest. He is president and COO of the company.