A large brokerage recently began encouraging its agents to withhold homes for sale from the MLS until its agents had already tried to sell the home. Zillow has begun fighting back against these brokerages.
Real Estate News reported:
“Samuelson confirmed … that could keep a listing off Zillow forever if that listing is not submitted to an MLS within 24 hours and made widely available.” The statement referred to almost all advertising, not just the increasing trend of brokerages advertising new listings on their own website for several weeks before putting them on the MLS.
The keyword is forever. Zillow gets so many property views that few home sellers would agree to keep their home off Zillow forever.
Zillow states “In California, a home sold off the MLS typically yielded $30,075 less than a home that was listed publicly (a median loss of 3.7%).”
Another excerpt from Zillow states:
A January 2025 Zillow/Harris Poll survey of more than 2,000 U.S. consumers found 63% of those who have sold a home within the past five years say their agent recommended listing on a private listing network. That’s compared to 18% for those who sold more than five years ago. Zillow added “pocket listings” accounted for 2% of sales.
Combining the above points, sellers are frequently recommended to hold off putting their home for sale on the MLS, but few sales result from that, and the sales that are achieved result in significantly lower sales prices. Thus, the seller will most likely lose out rather than gain, and the brokerage is making the recommendation in an attempt to help itself.
Consider how home buyers act to see if sellers can benefit. It is quite common for home buyers to ask buyer agents if the agent has access to off-market listings. Additionally, there are complaints by buyers that the agent intentionally listed the house at too low of a price to create a bidding war, with some also saying it would have sold for less if there hadn’t been a bidding war. Clearly, buyers see value for themselves if the home is not widely marketed.
What isn’t reported about the recommendations is: 1) why the home wasn’t immediately be put on the MLS, 2) how long the home would be privately listed, and 3) if the seller had already chosen a price that he would immediately sell the home for. There are sellers who, for reasons specific to their situation, do not want a lot of people coming to their house. This almost never applies to a vacant house, which is typical of most Silicon Valley homes for sale.
Many home buyers and home sellers do not know that Zillow sells contact information to real estate agents for people who search for homes on the Zillow website. Zillow has a strong financial interest in having all homes for sale quickly put on the MLS, and Zillow could be biased. However, finding the best buyer for a home requires that the home be advertised to the most people who would be interested in buying it. The MLS is the lowest-cost and most far-reaching way to contact potential buyers. Additional advertising is used to promote special features, to reach buyers who aren’t searching regularly, and to put the home in front of buyers a second or more times.
Both home sellers and home buyers suffer from restricted marketing. Sellers are likely to receive less money for their house. Home buyers are denied an opportunity to see houses they would be interested in.