Whether you’re a homeowner or just starting to tour houses with your real estate agent, there’s a good chance you’ve used a multiple listing service (MLS).An MLS is a private database used by Realtors to sell homes and find properties for their clients to buy. If your agent sends you a list of houses they think you’d like, they probably pulled the listings from an MLS.The term “MLS” is used broadly, but there are actually 500 MLSs, according to the National Association of Realtors. The ones your agent uses may depend on where you live.The largest real estate listing company in America, the California Regional Multiple Listing Service, has released a new feature called the “Limited Exposure Coming Soon” option.The CRMLS already had a Coming Soon tool. But adding the Limited Exposure option changes the game for both home sellers and buyers.Coming Soon vs. Limited Exposure Coming Soon listingsNormally, a multiple listing service’s Coming Soon feature flags the listing as “coming soon” on the MLS and third-party websites so people know it isn’t for sale yet.This tactic isn’t quite as restrictive as a pocket listing, which isn’t displayed on an MLS. With pocket listings, only buyers in the real estate agent’s private network can view the home.A regular Coming Soon listing typically still appears on third-party listing sites such as Zillow.A Coming Soon designation allows sellers to get the word out about their home while still taking a little extra time to prepare before releasing it to MLSs, according to Rocket Mortgage. This extra time also gives interested buyers more time to craft an offer, which can lead to better offers for the seller.Related: Redfin sees shift in housing market, home pricesNow the CRMLS has taken its existing Coming Soon feature and added the Limited Exposure option. When the seller selects this option, the for-sale listing will not show up on third-party websites such as Zillow, Realtor.com, Homes.com, local and neighborhood broker and agent sites, or the Google mobile app search, according to the CRMLS instructions.Notice that Redfin is not on the list of excluded websites. Sellers can list their home on Redfin Early Access, a search feature for pre-market homes that Redfin created in partnership with Compass.For a seller to select the Limited Exposure for Coming Soon option, their agent sets the “Internet Entire Listing Display” to “No” on the platform, according to the CRMLS guide. Once the seller is ready to make the listing public, the agent manually changes “Internet Entire Listing Display” to “Yes.”
The Coming Soon designation was already an MLS strategy, and now the CRMLS is adding a Limited Exposure option.Greggory DiSalvo / Getty Images
How Limited Exposure Coming Soon option affects sellersWhile a regular Coming Soon listings already gives sellers advantages, Limited Exposure Coming Soon takes those benefits one step further.As with a standard Coming Soon option, sellers have more time to prepare before their house officially goes on the market, and that extra time can generate buyer buzz to result in stronger offers.By keeping their property off of third-party websites like Zillow and Realtor.com, sellers limit who can see their property. The listing only appears on sites such as Redfin Early Access and the selling agent’s website. Other agents can also see the home on the MLS.The limited-exposure option allows the seller’s agent to show the property to other agents and get a sense of buyer interest before setting the listing as public. “They can test whether the price is realistic,” Joe Rath, head of industry relations at Rocket, writes for Redfin. “They can see whether a motivated buyer is willing to pay a premium before broader exposure. They can help the seller decide whether to launch publicly, adjust the strategy, or pause.”These are all strategies for helping the seller get the best price and terms possible, should they decide to move forward with selling.Limited Exposure Coming Soon hurts homebuyersHome affordability is already a crisis in America, and Zillow research shows that low inventory is the main culprit.Private listings make the inventory problem even worse for buyers. When the typical homebuyer can’t access certain listings, they have fewer options.Limited Exposure Coming Soon isn’t quite the same as a private listing. And sellers can choose to make their listing public later in the process. However, they don’t have to. If an agent with access to their limited-exposure listing has a buyer who will pay top dollar, the homeowner may choose to go ahead and sell rather than deal with a public listing.More Selling and Buying Houses:Why first-time homebuyers face a stacked deck right nowMortgage rate outlook shifts after inflation updateAmericans face dilemma after housing market newsLimited Exposure Coming Soon properties could also result in homebuyers paying more for a house.By holding off on showing the listing to the public, the seller and their agent have time to gauge whether their price is fair. If it’s too high, they can lower it before releasing it to websites like Zillow and Homes.com.And by waiting to publicly list the home, the number of days on the market shown on these sites is lower than if they had listed it from day one.In my years of reporting on the housing industry, I’ve learned that the longer a home sits on the market, the more leverage a buyer has. If the house is on the market for a long time and the seller has to cut the price, the buyer knows they have more power to negotiate for a lower price or seller concessions.But now that the typical buyer doesn’t have access to this information, they don’t have the full picture when making an offer.From where I’m sitting, it looks like the Limited Exposure Coming Soon feature adds to the housing inventory problem and has the potential to push buyers to offer more money — ultimately causing more affordability problems. The future of selling and buying homesSure, the California Regional Multiple Listing Service only serves buyers and sellers in one U.S. state. However, it is the largest MLS in the country, covers a significant portion of California real estate, and reaches about 110,000 agents, according to Redfin.Because the CRMLS is so powerful in the real estate world, I worry that more MLSs will follow in its footsteps by creating features like Limited Exposure Coming Soon.And since Redfin already has a tool that shows CRMLS’s Limited Exposure Coming Soon properties, I suspect other third-party websites will begin implementing similar devices.The more widespread this type of feature becomes, the more sellers around the U.S. will benefit. But I believe that more homebuyers will inevitably face limited access, less leverage, and — in some cases — higher home prices.Related: Zillow releases crucial new housing market prediction