No MLS? No Listing! Zillow bans pocket listings - here's why it matters

Oh well, another week, another twist in what’s been a very eventful 2025 for the real estate market.

Zillow has announced that, starting May 2025, it will no longer display listings that are publicly marketed but not entered into an MLS within one business day.

Let’s look beyond the headlines to understand “WHY”.

Here is what we know:

• This decision comes two weeks after NAR announced the changes to the Clear Cooperation Policy.

• Zillow’s core business right now is Zillow Flex

• Instead of selling ads (like in the old Premier Agent model), Zillow focuses on partnering with top-producing teams and

• Previously, with Premier Agent, Zillow was essentially paid upfront for showing ads, and independently of what the agent's outcomes were. Now, Zillow only gets paid when a transaction closes, which aligns better with agent outcomes.

What else do we know?

• Exactly two weeks ago, NAR announced its changes to the Clear Cooperation Policy.

• If we boil it down, it introduces a new kind of listing marketing option called "delayed marketing exempt listings” (easy to remember, right?).

• a.k.a “I’m listing my house, but I don’t want anyone to know”

• a.k.a “Private Exclusives specially for Compass”

• What Zillow is saying: “If you want to market your property to the public, you are welcome. If you want to play games - we’re not having it.”

• So starting next month, Zillow will not allow any non-MLS "delayed marketing exempt listings”.

Wouldn’t Zillow have fewer listings as a result of such a policy?

• Of course, for Zillow's core business to work, it needs high buyer traffic and trust—buyers must feel that Zillow has the most complete, up-to-date listings.

• So removing 4-5% of listings seems like a counterintuitive move.

• Here is why it makes a ton of sense for Zillow.

• Flex partner agents get leads from Zillow. If Zillow is polluted with private listings from agents outside the Flex network, those agents are:

  • closing deals without Zillow’s help,

  • and not paying Flex a fee.

• So enforcing this policy protects the value of Flex, even if it means trimming listing volume short term.

• Aside from money matters, this move helps to maintain a transparent market.

• If you would like to learn what it takes to buy a house in Europe, where every listing is a pocket listing, I invite you to take a look at my last week’s article on Clear Cooperation Policy changes.

“We'd rather have 95% of listings with 100% trust, than 100% of listings with consumer doubt.”

What a punchline from Zillow.

They are certainly in the position to set the rules because they control the consumer, being the go-to platform for most buyers.

Source: https://www.mikedp.com/articles/2024/9/10/portal-war-24-what-1-billion-in-advertising-buys-you

The opposite is also true - most sellers expect their listings to be on Zillow.

Now imagine a situation where a Compass Private Exclusive listing was on the market for many months and did not sell. The seller asks the agent to put it on Zillow, but finds out that it can’t be listed on Zillow anymore 😱

It’s just amazing how the market is being re-shaped in front of our eyes. Zillow, which once challenged to replace real estate agents with its iBuying, is now fighting for market transparency along with NAR. Exciting times…

One thing is clear… this is certainly not the end of the battle. More to come.