Should realtors be required to multiple-list homes for sale?

 The WSJ has the story:

An Industry Dispute Threatens to Shake Up How Homes Are Listed for Sale. Some real-estate brokerages are pushing to repeal a National Association of Realtors rule governing how listings are marketed. By Nicole Friedman, Nov. 3, 2024

"The National Association of Realtors’ landmark settlement is changing the way homes are bought and sold. Now, another industry dispute threatens to shake up how homes are listed for sale. 

A rule implemented in 2020 requires most real-estate agents to add listings into local databases known as multiple-listing services within one business day of publicly advertising the listing. 

Advocates say the rule, known as the clear cooperation policy, makes the housing market more transparent by putting available homes in one place. The goal of the rule was to reduce the number of home listings that are shared privately with a select group of buyers or agents, known as pocket listings.

But opponents say the rule limits sellers’ options for how they can market their homes and puts brokerages at risk of lawsuits. The Justice Department’s antitrust division is investigating the policy, and a lawsuit against NAR regarding the rule is scheduled to go to trial in late 2025.

...

"The NAR rule currently allows listings to be kept off the MLS if they are only marketed within one brokerage, known as an “office exclusive.” That exception can benefit big brokerages, which have more potential buyers for those in-office listings. 

...

"In some markets, most Compass listings start out as office exclusives, Reffkin said in an August earnings call. 

“Those homeowners, they want to be able to test the market” before listing their homes more widely, he said. “The reason why private exclusives at Compass are so popular is because they do not have days on market [or] price drop history.”"

Real estate auctions

 Peter Cramton points me to this article in the Orange County Register, about a real estate auction with a soft close, that ran for several months.

How ‘soft’ auction added $33million to price for Orange County County icon By Jonathan Lansner

"The federal government’s exit from the eye-catching Chet Holifield Federal Building – better known as the “Ziggurat” – began June 5. The initial auction deadline for the building plus 89 acres in Laguna Niguel was July 31, but it came with a big “but” in the rules.

"You see, this auction run by the General Services Administration has a “soft close” – if the high price is topped in a 24-hour period, the auction is extended for another 24 hours.

"And on July 31 – and for every business day through Friday, Oct. 4 – that extra bidding threshold was met. 

"Consider the math of this curious auction technique: On July 31, the first deadline, the Ziggurat price tag was $136.8 million. The 46 added days of bidding increased that to $169.6 million as of Friday.

...

"Cramton wonders why auctions of any style aren’t more widely used to sell all sorts of residential housing nationwide. He sees them as fast and efficient ways to maximize pricing.

"Yet, auctions are typically used only to sell US homes with financially distressed ownership.

"“We don’t need thousands of real estate agents,” the professor says."

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He further says: "There are 1.6 million real estate agents in the US and 434,661 in California (including brokers)."

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The WSJ has this story on real estate auctions:

"The Wealthy Are Overpricing Their Homes. Auctions Show Just How Much. Desperate to sell, more rich homeowners are turning to the auction market—but the results aren’t always what they bargained for.  By Katherine Clarke  and E.B. Solomont, Oct. 30, 2024 

"More closely associated with pricey art or collectibles, auctions are on the rise for luxury real estate, with auction houses reporting a dramatic spike in the number of high-net-worth sellers seeking their services since 2020. Amid a slowdown in luxury home sales, auction companies are pitching homeowners on their ability to market unique properties to a range of deep-pocketed buyers beyond local markets and to sell them within a precise time frame.

...

"Auctions tend to attract the real-estate world’s white elephants—properties that may be quirky, highly-personalized or ultraluxury, resort-style homes in neighborhoods where that type of housing is atypical.

...

"Whether there’s a reserve price or not, Concierge takes a 12% to 15% buyer’s premium as a commission, plus there are agent fees. It markets the property heavily before the auction, and tries to generate early offers by offering prospective buyers a “starting bid incentive,” or 50% discount on the buyer’s premium if they submit a winning bid before the start of the auction."

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Peter C. emails the following comment (since comments on the blog are closed):

"Real estate norms vary by country. In Norway and Australia, auctions are the norm. In the US, transactions are brokered, sometimes aided by an auction process. In all countries, residential and commercial real estate transactions would be improved with a better market design that emphasizes transparency and efficiency as goals in solving real estate's economic problems. Market design research on real estate is needed."

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*I enjoyed comments when I allowed them, but closed them because each morning I had to delete spam comments advertising bogus kidney purchases and sales...:(

Prompt Engineering, by Mukund Sundararajan

 Do you want to improve your chats with chatbots based on Large Language Models (LLMs)? (For example, GPT, Gemini, Anthropic/ Claude, Meta...) Here's a chance to learn from Mukund Sundararajan, who knows what those LLMs are good at (and not so good at) and why, and how to think about how to prompt them. His book might have been called How to be a Prompt Engineer.

Thinking Like A Large Language Model: Become an AI manager 
by Mukund Sundararajan
 
"Consider an analogy. You are a manager, you have an employee, and you are trying to get a task done. It helps to understand how the employee thinks, what the employee knows, and how they may behave. What would happen if you made a certain request? How would the employee interpret it? How would they respond? What do our past interactions with the employee tell us about their capabilities? How should we phrase our request so that it is interpreted correctly? Should we break our request into steps? What aspects of their work would we need to verify?

"Now imagine the employee is an AI. It still helps to have answers for the questions above. The goal of this book is to help you arrive at those answers.

"We describe how a Large Language Model (LLM) operates in three different ways: via input-output examples, via an overview of its training process, and via analogies to other familiar concepts.

"You don't have to work with technology to understand this book. It will be accessible to anyone with a high-school education—students, professionals, business-people, executives—anyone who wants to extract value out of LLMs or chatbots.

"Author details: Mukund Sundararajan is a Distinguished Research Scientist at Google DeepMind. He has spent the past decade analyzing, developing, and deploying AI in products—successfully and unsuccessfully. He has also observed others do so. He currently works on the Gemini series of Large Language Models and writes prompts for a living."