How Compass staged its pre-marketing blitz in Seattle
Brokerage leadership coordinated a private listings push in the region despite MLS rules restricting pre-marketing — and the risk of steep fines for agents.
Key points:
- While Compass rolled out its three-phase marketing strategy in other regions months ago, the company just recently made its first private exclusives push in Washington state.
- Two Compass agents who participated in the effort said the brokerage promised to back them up and cover any fines from breaking NWMLS rules against pre-marketing.
- The brokerage has hit NWMLS from multiple angles, including attacking its board, which Compass CEO Robert Reffkin has accused of being a “monopoly.”
The war over private listings in Washington state is quickly escalating as Compass appears to have instructed its agents to disobey local MLS rules prohibiting pre-marketing of homes, while also seeking to build a database of seller clients who could potentially take legal action against Northwest Multiple Listing Service.
But the campaign started with a blitz of private exclusives.
Since March 20, Compass CEO Robert Reffkin has publicly highlighted a number of agents in the Seattle area who were the first to participate in the brokerage's three-phase marketing strategy and list their sellers' homes as a Compass Private Exclusive.
The first was Sam Cunningham, who Reffkin applauded via Instagram and LinkedIn. Speaking to Real Estate News about Compass' private listings push in the Seattle area, Cunningham said it was an effort that had come from the top down and was strategically coordinated as a test pilot.
Private listings are 'going to happen anyway'
Cunningham, who launched the first Compass Private Exclusive in Washington state, said "the reality is that pre-marketing is going to happen anyway." In fact, he noted, it's already happening: "20% of our sales in Washington State happen off market."
"So those sales are happening between Realtors who are already doing this. What I'm talking about is like prohibition — everybody's already drinking, so why don't we make it legal?"
Compass' pre-marketing blitz in the Seattle area was likely intended to force NWMLS to take action — by either penalizing Compass agents en masse for breaking its rules, or by making an exception to those rules. Compass leadership told local agents participating in the effort that the brokerage would "remain committed," indefinitely, to covering any fines from NWMLS resulting from the private listing push, Real Estate News learned and Cunningham confirmed.
So far, no fines reported
Cunningham said the fine for pre-marketing a listing could be as steep as $5,000, but he wasn't contacted or penalized by NWMLS for pre-marketing a home. After listing his seller's property for five days as a Private Exclusive, he ended up putting it on the open market, and the home went under contract shortly after going on the MLS.
Carii Clawson, whose $2.5 million private listing for a Bainbridge Island home was another Seattle-area first for Compass, was also praised by Reffkin. She told Real Estate News that she wasn't fined by NWMLS either.
"They have put the fear of God in me and my colleagues, as far as saying that you will do it this way or no way," Clawson said about NWMLS' rules against pre-marketing. "So, yeah, it's kind of scary, but I had faith in the company I worked for. [Compass leadership] said, don't worry, Carii, we know what we're doing. And I also had faith in my seller."
NWMLS stands firm on private listings, hasn't revealed its next move
NWMLS declined to comment on this story, but previously published an open letter on March 28 reiterating its position on pre-marketing, arguing that such strategies are "misguided" and "exclusionary."
"Those efforts are not for the benefit of sellers or buyers, but are instead designed to benefit those brokerage firms by entrenching them as the gatekeepers of property listings," the statement — attributed to NWMLS CEO Justin Haag in an email — said.
Compass' war against NWMLS also includes a battle with the organization's board of directors, which Reffkin has accused as being a "monopoly." He pointed to Windermere's six seats on the board as a sign of collusion, calling NWMLS a "brokerage-owned trade group controlled by Windermere." Notably, NWMLS' January announcement of its new board members included a Compass agent, but that agent is no longer listed on the board webpage.
A Compass spokesperson declined to comment on the status of that member, but said the brokerage "remains committed to supporting our Washington agents and their clients."
NWMLS reportedly warned Compass agents not to post private listings after March 28, but it's unclear if the organization will ultimately decide to issue fines. Either way, Compass is likely to continue its pre-marketing strategy in the high-demand Seattle region, where the median sale price is over $850,000.
"The MLS ended up saying we're gonna give you guys a week of a break from the rules, but don't post anything after Friday night at midnight," Cunningham explained.
"They did a week of clemency, because enough of us jumped in — you know, if you find 10 or 15 people doing it, suddenly you've got a movement on your hands and my impression was the MLS didn't want to deal with that."