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South Carolina’s New Private Listing Rules: What Every Real Estate Agent Needs to Know · Dishin' Dirt with Gary Pickren

0:00
SPEAKER_01: On August 13th, 2026, the South Carolina Real Estate Commission issued a brand new guidance document that deals with what it calls the seller-directed limited residential market exposure.
0:12
SPEAKER_01: What we're talking about here is your private listings, your office exclusives, those pocket listings, those off MLS listings, the delayed marketing program some of you have, the limited exposure listings, all of that stuff.
0:24
SPEAKER_01: Whatever terminology you use, your brokerage uses, or even your MLS uses, we're all talking about the same situation.
0:31
SPEAKER_01: And this is where a seller lists a property for sale, but intentionally does not expose that property to the entire marketplace.
0:38
SPEAKER_01: Now, if you've been listening to Dish and Dirt at all the last week, the last month, the last year, you know that this has become one of the biggest battles in residential real estate today.
0:47
SPEAKER_01: I've talked about it all as a result of Robert Refkin and his office exclusive program that he's put in place.
0:53
SPEAKER_01: We've talked about compass, we've talked about the private exclusives, we've talked about clear cooperation, how NAR has the program, why it's here, and why it's necessary.
1:00
SPEAKER_01: We've also talked about Zillow in the lawsuits, the race to have the portals, how everyone's fighting over listing data, and how every brokerage wants to control not only the data, but to control the inventory.
1:11
SPEAKER_01: But most importantly, what we've talked about is whether the future of real estate is going to be a single open marketplace where everybody, regardless of where you come from, what you look like, who you marry, what you worship, whether you will have the opportunity to see every single house at the exact same time and have an equal opportunity to buy that house, or are we going to move to a collection of exclusive private marketplaces that are controlled by a select group of individuals at the biggest brokerages and the biggest portals?
1:39
SPEAKER_01: Well, the good news is South Carolina, the Real Estate Commission, has now weighed in on this.
1:44
SPEAKER_01: And I want everybody to be very clear about what I'm going to talk about here today because there's a lot of misunderstanding already about this guidance.
1:50
SPEAKER_01: The South Carolina Real Estate Commission did not ban private listings.
1:55
SPEAKER_01: Private listings are not prohibited in the state of South Carolina.
1:58
SPEAKER_01: In fact, the very first page of our guidance makes it very clear that South Carolina law does permit the seller, and that's the key word there, the seller to determine how the seller's property will be marketed.
2:10
SPEAKER_01: Not the listing agent, not the listing broker, not the brokerage, not Robert Refkin, none of that.
2:15
SPEAKER_01: It is determined by the seller.
2:18
SPEAKER_01: So if you hear somebody today saying that the real estate commission just outlawed office exclusives, that's not entirely correct.
2:24
SPEAKER_01: It's not exactly what happened.
2:26
SPEAKER_01: But, and this is a significant but, this might be the biggest but I've ever used in a podcast, but the commission has made its position extremely clear as to your fiduciary duties as well as your statutory duties.
2:41
SPEAKER_01: And they're very clear on that and their ramifications around that.
2:45
SPEAKER_01: The commission has said, and I'm going to quote some of what it says in this document, that broad public marketing will, quote, ordinarily be more consistent with the seller's goals and with the public policy favoring equal housing opportunity.
2:58
SPEAKER_01: That's your fair housing, unless that particular seller has circumstances that reasonably justify limiting exposure.
3:05
SPEAKER_01: So it's a reasonably justified standard.
3:09
SPEAKER_01: And it's based on the circumstances around the seller, not around the agent.
3:12
SPEAKER_01: And the commission goes even further, says that a licensee who recommends limited market exposure, quote, bears the responsibility of demonstrating that the recommendation was made in the seller's best interest and was not primarily designed to advance the interest of the brokerage or its affiliated licensees.
3:30
SPEAKER_01: Well, what I've seen so far in the marketplace definitely is for the benefit of the brokerage.
3:35
SPEAKER_01: And there's a lot of gaslighting out there about how that seller's choice and how we have qualified buyers that can help make better offers and that we can set the market price and that we can test the market.
3:45
SPEAKER_01: All of that is stuff that a real estate agent should do anyway.
3:47
SPEAKER_01: And that is complete gaslighting.
3:49
SPEAKER_01: Haven't heard an argument that passes the giggle test yet.
3:52
SPEAKER_01: But my favorite thing about it is that the commission says licensees recommending a limited market exposure strategy should be prepared to demonstrate that the recommendation served the seller's best interest, complied with applicable law, and was supported by appropriate disclosures and documentation.
4:09
SPEAKER_01: So they're giving you the roadmap to what's going to happen if you get agreements for violating your duties.
4:14
SPEAKER_01: Now I want you to think about that for a second, because this is where it gets very interesting.
4:18
SPEAKER_01: The commission is essentially saying, yes, you can do your limited marketing plan, but if you're the one recommended it, you the agent, you better be able to come before us and explain why you did it.
4:27
SPEAKER_01: But more importantly, you better be able to explain how it's for the benefit of the seller.
4:31
SPEAKER_01: They're basically saying if you recommended it and you can't tell us why you did it, and you can't tell us how it's a benefit for the seller, you're going to have a big problem because it's not how it benefited you, it's not how it benefited your team or helped your brokerage recruit more agents or helped your brokerage get both sides of the transaction.
4:48
SPEAKER_01: It's not about how y'all kept the commission or all the data or the listing in company and it's unfair how Zillow handles work.
4:54
SPEAKER_01: Not about that at all.
4:55
SPEAKER_01: It's how did it benefit the seller?
4:58
SPEAKER_01: And that is going to be the big question.
5:00
SPEAKER_01: And the commission didn't stop, it was just a guidance letter, guys.
5:02
SPEAKER_01: It also approved a new two-page disclosure and acknowledgement form, which is specific for limited marketing exposure listings.
5:09
SPEAKER_01: And this form's outstanding, if I might say so.
5:12
SPEAKER_01: I helped write it.
5:13
SPEAKER_01: The seller has to acknowledge the potential for fewer offers.
5:17
SPEAKER_01: They also have to acknowledge potential for lower sales price, less favorable terms, increased marketing time, reduced competition, fair housing considerations, and the increased likelihood that the broker, the listing broker, might have an affiliated agent who also will represent the buyer.
5:32
SPEAKER_01: And it even addresses the possible effect that large numbers of private listings could have on comparable sales.
5:38
SPEAKER_01: Honestly, how would any seller read these and initial these and not be concerned that this is not in their best interest?
5:44
SPEAKER_01: And then we get to the brokerage certification that's also in the form.
5:47
SPEAKER_01: This is where it got really good, in my opinion.
5:49
SPEAKER_01: The broker has to identify whether the seller independently requested the limited marketing strategy, which rarely happens.
5:56
SPEAKER_01: I've been told by thousands of agents it rarely happens, or did the agent introduce the limited marketing strategy based upon the seller stated objectives and best interests?
6:04
SPEAKER_01: The reality of it is that these programs out there are being offered not for the benefit of the seller, they're being offered for the benefit of the brokerage.
6:12
SPEAKER_01: Those are two very different situations here, and we're going to talk about why.
6:16
SPEAKER_01: The form then says the brokerage must not recommend limited exposure primarily to increase the likelihood of representing both parties, retain commissions within the brokerage, benefit the brokerage or licensee over the seller, or obtain another financial or competitive advantage inconsistent with the broker's brokerage's statutory duties.
6:35
SPEAKER_01: And then guess what who and then guess who has to sign this form?
6:38
SPEAKER_01: The seller, the listing agent, and the broker in charge.
6:40
SPEAKER_01: So if you're a broker in charge today listing, going, I don't care, it's not my problem.
6:44
SPEAKER_01: Guess what?
6:44
SPEAKER_01: It is your problem because your signature is going to be sitting right there on that form for the real estate commission to see.
6:50
SPEAKER_01: So today we're going to unpack all of this.
6:52
SPEAKER_01: We're going to talk about what the commission actually said, what it didn't say.
6:55
SPEAKER_01: We're going to talk about the differences between a seller asking for privacy and a brokerage trying to sell the seller on privacy.
7:01
SPEAKER_01: We'll talk about fiduciary duties, some fair housing, and so forth.
7:04
SPEAKER_01: And we're going to talk about what happens two years from now when a seller walks into a lawyer's office and says, My agent convinced me not to put my house on the open market to do as an exclusive listing.
7:15
SPEAKER_01: I sold it within days for$650,000.
7:18
SPEAKER_01: But three months later, my neighbor down the street, who has the same house as me, sold theirs for$725 after getting seven offers on the open market.
7:26
SPEAKER_01: No one told me this could happen.
7:27
SPEAKER_01: So this form, as much as it is to support the consumer, it also is to help protect the agent so that the agent can properly document those conversations.
7:36
SPEAKER_01: Because the question's going to be is what does your file look like?
7:39
SPEAKER_01: That's what this guidance is about.
7:40
SPEAKER_01: It's not simply, can you do private listing?
7:43
SPEAKER_01: You can, they're legal in limited situations.
7:45
SPEAKER_01: But the better question is, can you defend why you did the private listing?
7:49
SPEAKER_01: Why did you recommend it?
7:50
SPEAKER_01: Can you prove that you did it in the best interest of the seller and not in your best interest?
7:56
SPEAKER_01: And I'm going to cover this and a whole lot more on this episode of Dish and Dirt.
8:00
SPEAKER_00: This is Dish and Dirt with Gary Pickering, South Carolina's only podcast dedicated to the real estate agent craft.
8:08
SPEAKER_00: And now the host of Dish and Dirt, Gary Picker.
8:11
SPEAKER_01: Hey Greens, and welcome back, everyone, to another episode of Dish and Dirt.
8:13
SPEAKER_01: I'm your often opinion A, but really wrong host, Gary Pickering, coming to you from the beautiful downtown Columbia, South Carolina offices of Blair Keto Picker Catch on this, the fourth week, and last week of August 2026.
8:25
SPEAKER_01: Last week we had a couple of really cool announcements.
8:27
SPEAKER_01: We announced that Norton Getty is going to be joining our firm down in our Myrtle Beach office, and we're really excited to bring Norton and his many decades of knowledge and educational experience to the firm.
8:37
SPEAKER_01: It's going to be a great addition.
8:38
SPEAKER_01: We also announced that we'd be adding a couple of new locations and making announcements as to those here in the next few days.
8:44
SPEAKER_01: But today we're going to make a really cool announcement.
8:46
SPEAKER_01: Blythewood, as you know, we opened in June in our new Blythewood office.
8:50
SPEAKER_01: At the time, that was our 10th office.
8:51
SPEAKER_01: And we're going to have our grand opening, our open house, if you will, on September the 2nd from 5 to 7.
8:57
SPEAKER_01: We hope that you will stop by our beautiful office right there behind the Chick-fil-A on Killian Road.
9:02
SPEAKER_01: Look forward to seeing you there September 2nd at our new Blythewood office.
9:05
SPEAKER_01: Before we start today, let me tell you it's going to take a couple of weeks to actually go through this form.
9:09
SPEAKER_01: And the reason is it's very important.
9:11
SPEAKER_01: Maybe one of the most important guidance letters and forms that the Real Estate Commission has set out in years.
9:16
SPEAKER_01: Parts of our state are involved in exclusive listings, and they're not doing it necessarily for the best of the seller.
9:23
SPEAKER_01: They're doing it for their own brokerage or their own team.
9:25
SPEAKER_01: Let me start by separating three things that I think are going to get mixed here together.
9:30
SPEAKER_01: We have law, we have MLS rules, and we have Real Estate Commission guidance.
9:34
SPEAKER_01: It's not all the same thing.
9:36
SPEAKER_01: This guidance does not change the law.
9:38
SPEAKER_01: In fact, the Real Estate Commission specifically says at the end of the document that nothing in the guidance creates new legal duties or prohibits limited market exposure listings.
9:47
SPEAKER_01: That's important.
9:48
SPEAKER_01: The commission isn't passing a new statute, and it's not creating new regulations, and it isn't saying as of August 13th, private listings are illegal.
9:57
SPEAKER_01: Instead, what the commission is doing is it's telling licensees how it views the duties that already exist under existing South Carolina law when those duties are applied to private and limited exposure listings.
10:09
SPEAKER_01: So what duties are we talking about?
10:11
SPEAKER_01: We're talking about fiduciary duties, disclosure obligations, your duties to promote your client's best interest, fair housing obligations, which you do have, you have to follow federal law, the responsibility to identify conflicts of interest and disclose those conflicts of interest to your clients, and the responsibility to obtain meaningful informed consent, not just a signature on a form.
10:32
SPEAKER_01: It has to be informed consent.
10:34
SPEAKER_01: Those duties already exist.
10:36
SPEAKER_01: The commission is now telling you how those duties fit into this relatively new and rapid expanding private listing environment.
10:43
SPEAKER_01: And that's the distinction that matters because sometimes when a regulator issues guidance, people overreact in one of two ways.
10:49
SPEAKER_01: One side will say, well, this is now the law.
10:51
SPEAKER_01: This is the law of the land.
10:53
SPEAKER_01: And the other side will say, well, it's only guidance, so it doesn't matter.
10:56
SPEAKER_01: I wouldn't take either one of those positions today if I were you, because if you're defending your license in front of the real estate commission two years from now over a private listing where a consumer is saying they didn't understand or they weren't given full information, what document do you think everyone at the commission is going to be looking at?
11:12
SPEAKER_01: This one, this new document.
11:13
SPEAKER_01: They're going to look at that guidance letter and they're going to look at that form.
11:16
SPEAKER_01: And the questions are going to be: did you explain marketing alternatives?
11:19
SPEAKER_01: Did you explain disadvantages?
11:21
SPEAKER_01: Did you go over all your possible conflicts?
11:23
SPEAKER_01: Did you consider any fair housing issues that might arise?
11:27
SPEAKER_01: Did the seller actually understand what they were given up in this marketing plan?
11:31
SPEAKER_01: Was it voluntary?
11:32
SPEAKER_01: Was it documented?
11:33
SPEAKER_01: But most importantly, why did you recommend it?
11:37
SPEAKER_01: And that's what makes this document important because the commission has effectively given the industry your roadmap.
11:43
SPEAKER_01: And whenever regulators give you a roadmap to any particular question of the day, it believes you should be asking these questions and you probably ought to be paying attention to that roadmap.
11:52
SPEAKER_01: The seller is still going to control the decisions.
11:55
SPEAKER_01: That is the most important thing.
11:57
SPEAKER_01: That's what we need to make very, very clear.
11:59
SPEAKER_01: The commission says the decision belongs to the seller.
12:03
SPEAKER_01: And I think that's important because I don't want agents listening to the episode and walking away saying, well, Gary says every property has to go directly to the MLS day one.
12:11
SPEAKER_01: I'm not saying that.
12:12
SPEAKER_01: That's not what the real estate commission is saying.
12:14
SPEAKER_01: There's absolutely can be legitimate reasons why a seller doesn't want broad public exposure.
12:20
SPEAKER_01: We've talked about them, domestic violence, family situations.
12:23
SPEAKER_01: Those are, in fact, circumstances where limited exposure may make complete sense, but they're very rare.
12:28
SPEAKER_01: In fact, Leo Perea at EXP told me out of 300,000 listings they had last year, less than 1,000 of them were done exclusively.
12:38
SPEAKER_01: They're not even 1% of the time.
12:40
SPEAKER_01: It's like a fraction of the time.
12:42
SPEAKER_01: It's certainly not 25 or 55% of the time that we're seeing in some markets.
12:46
SPEAKER_01: And if the seller understands the trade-offs and says, I understand that broad marketing may bring me more buyers, I understand it may increase competition, and I understand I could probably get better pricing for my house, but privacy is more important to me, and this is why, then fine.
13:01
SPEAKER_01: That is the seller's decision.
13:03
SPEAKER_01: Your client does not have to sell their house to maximize every dollar.
13:06
SPEAKER_01: People make decisions for reasons other than money.
13:09
SPEAKER_01: Maybe they need speed.
13:10
SPEAKER_01: Maybe they need privacy.
13:11
SPEAKER_01: Those are all considerations of the seller.
13:13
SPEAKER_01: But here's why the commission appears to be drawing the line.
13:16
SPEAKER_01: There's a difference between the seller having a reason for limited exposure and the brokerage having a reason for limited exposure and then trying to talk the client into it, which is what's happening today.
13:27
SPEAKER_01: The brokerages today, they have the reason for limited exposure, and they use gaslighting to try to talk the seller into doing what is in the brokerage's best interest by telling them that they have qualified buyers, they have better buyers, that they can get the property sold, they can set the market price, they can explore the market price.
13:43
SPEAKER_01: It's all gaslighting.
13:44
SPEAKER_01: That is the distinction that I want you to keep in your head throughout this entire episode.
13:47
SPEAKER_01: Because if the seller comes to you and says, I don't want this property publicly marketed, and here's why, that's one fact pattern.
13:53
SPEAKER_01: If the seller comes to you and says, I wanted to get the highest price for my house, and the agent says, Great, let me tell you why I should put it in my private network for the first two weeks and establish the price and all this stuff, that's a very different fact pattern.
14:06
SPEAKER_01: Now the agent has introduced a strategy.
14:09
SPEAKER_01: It's now the agent that has recommended the limitation.
14:12
SPEAKER_01: And according to this guidance, the agent needs to be prepared to demonstrate why that recommendation served the seller's best interest.
14:19
SPEAKER_01: That's going to be very difficult in that scenario.
14:22
SPEAKER_01: That brings us to what I believe is probably the most important statement in the entire guidance document.
14:27
SPEAKER_01: Here's a sentence I would highlight if I were you.
14:30
SPEAKER_01: A licensee recommending a limited market exposure listing bears the responsibility.
14:35
SPEAKER_01: I would highlight that, bears the responsibility of demonstrating that the recommendation was made in the seller's best interest, circle underline, highlight that, and not primarily to advance the interest of the brokerage or its affiliated licensees.
14:49
SPEAKER_01: That's the sentence.
14:50
SPEAKER_01: Put a star beside it, highlight it, send it to your agent friends, have your broker discuss it at a meeting.
14:54
SPEAKER_01: Because that sentence changes the conversation from did the seller sign the form?
14:59
SPEAKER_01: If so, we're good, to why did you recommend this?
15:03
SPEAKER_01: Those aren't the same things.
15:05
SPEAKER_01: We have developed this mindset in real estate that sometimes a signed disclosure form cures everything.
15:11
SPEAKER_01: Well, they signed it, so I'm good to go, right?
15:14
SPEAKER_01: Well, maybe, maybe not.
15:16
SPEAKER_01: What did you tell them before they signed it?
15:18
SPEAKER_01: Did they understand the explanation?
15:20
SPEAKER_01: Did you give them balanced information?
15:22
SPEAKER_01: Did you explain alternatives?
15:24
SPEAKER_01: Did you explain what they might be giving up by going this route?
15:27
SPEAKER_01: But most importantly, if you recommended the strategy, what was your basis for that recommendation?
15:32
SPEAKER_01: Informed consent isn't just getting somebody's initials, it's getting somebody to understand what they're doing before they give you their initials.
15:41
SPEAKER_01: The Commission Act says a seller's signature should reflect more than receipt of the form.
15:46
SPEAKER_01: It should demonstrate that the seller receives sufficient information to make an informed decision.
15:51
SPEAKER_01: That's the major point.
15:52
SPEAKER_01: A form does not replace a conversation, and a signature does not automatically prove informed consent and get you out of hot water.
16:00
SPEAKER_01: Think about this form from the perspective of a complaint.
16:02
SPEAKER_01: Let's create a hypothetical here.
16:04
SPEAKER_01: I got a seller who owns a house somewhere around 800 grand.
16:08
SPEAKER_01: She tells her agent, I want to get as much money as I reasonably can for this house.
16:11
SPEAKER_01: I'm downsizing, I need the money to fund my retirement.
16:13
SPEAKER_01: It's a pretty straightforward objective here.
16:16
SPEAKER_01: But the agent says, before we put your house on the MLS, our company has this fantastic private network.
16:21
SPEAKER_01: We have thousands of highly qualified buyers.
16:23
SPEAKER_01: Let's give our agents an opportunity to try to sell it internally first so you won't have to deal with as many showings and you might be able to get it sold before it even hits the market.
16:31
SPEAKER_01: Let's save you some privacy right there.
16:32
SPEAKER_01: And the seller says, Well, you're the expert.
16:34
SPEAKER_01: That's what you recommend.
16:35
SPEAKER_01: Let's do it.
16:35
SPEAKER_01: And they sign the disclosure.
16:37
SPEAKER_01: And an agent inside your brokerage brings a buyer.
16:39
SPEAKER_01: The house sells at 800 grand within days.
16:41
SPEAKER_01: Everybody is seemingly happy until two months later, that is, of course.
16:45
SPEAKER_01: And the neighbor puts an identical house on the market.
16:47
SPEAKER_01: They have 27 showings, eight offers, the house sells for$875,000.
16:51
SPEAKER_01: Now your client starts asking those questions.
16:53
SPEAKER_01: Why wasn't my house offered to those buyers?
16:56
SPEAKER_01: Why didn't my house go on Zillow?
16:58
SPEAKER_01: Why didn't every agent on the MLS know about my house being available?
17:01
SPEAKER_01: Why didn't you create competition?
17:02
SPEAKER_01: Why did the other agent in your office get the buyer?
17:04
SPEAKER_01: Was it so they could get the money?
17:06
SPEAKER_01: And then comes this very dangerous question they're going to ask.
17:09
SPEAKER_01: Did you recommend the private listing to me because it was best for me or because it was best for you and your company?
17:14
SPEAKER_01: So now we're going to have to pull your file after she files a lawsuit, and we've got to see what's in there.
17:18
SPEAKER_01: If the answer is simply, well, I got her to sign the form, I don't like your position at all.
17:23
SPEAKER_01: And remember, I have spent my entire career defending real estate agents, either at the real estate commission where I appeared over 50 times, helped writing certain forms, such as the South Carolina seller disclosure form, and now serving as expert for real estate agents in litigation.
17:37
SPEAKER_01: I've spent my entire professional life doing this.
17:39
SPEAKER_01: And I hate your position.
17:40
SPEAKER_01: It's not a solid position.
17:42
SPEAKER_01: Because what was your seller's objective?
17:44
SPEAKER_01: Was it documented?
17:45
SPEAKER_01: Was limited exposure consistent with her objective?
17:48
SPEAKER_01: Were alternates discussed?
17:50
SPEAKER_01: Did you discuss anything about pricing?
17:52
SPEAKER_01: Did you discuss anything about competition?
17:53
SPEAKER_01: Were your conflicts disclosed?
17:55
SPEAKER_01: Was the possibility that another affiliated agent in your office might represent the buyer discussed?
18:00
SPEAKER_01: Did anyone even explain that broad exposure could produce higher, better competing offers?
18:05
SPEAKER_01: That is what this guidance is telling agents to think about.
18:08
SPEAKER_01: Fiduciary duty does not disappear because the seller simply signed some form.
18:13
SPEAKER_01: Remember what an agency relationship means.
18:16
SPEAKER_01: The commission said it very simply.
18:18
SPEAKER_01: A broker must promote the interest of the seller above the interest of the broker, above the interest of the brokerage, and certainly above the interest of the agent.
18:27
SPEAKER_01: That's the foundation of real estate agency.
18:30
SPEAKER_01: And that's why the private listing issue has gotten complicated.
18:33
SPEAKER_01: And it's why I think it has absolutely been a big mistake in our marketplace.
18:36
SPEAKER_01: Because there are oftentimes situations where the brokerage has a financial interest in limiting exposure.
18:41
SPEAKER_01: Let's just acknowledge reality here.
18:43
SPEAKER_01: If I publicly market a property to every brokerage in South Carolina, potentially any buyer's agent can bring that buyer.
18:50
SPEAKER_01: But if I first expose the property primarily or even exclusively within my own brokerage, what happens to the probability that my company will be involved in both sides?
18:59
SPEAKER_01: It's just simple math.
19:00
SPEAKER_01: That doesn't automatically make this transaction improper, but it does create a potential conflict that has to be explained and has to be considered by the seller.
19:08
SPEAKER_01: And the commission's new form specifically addresses that.
19:11
SPEAKER_01: The seller initials an acknowledgement stating that limited marketing exposure increases the likelihood that the listing brokerage or one of its affiliated licensees may also represent the prospective buyer.
19:22
SPEAKER_01: Why put that in the form?
19:24
SPEAKER_01: Because the commission clearly sees that as something the seller should understand when making their decision in order to have informed consent.
19:31
SPEAKER_01: Then look at the brokerage certification on the form.
19:34
SPEAKER_01: The brokerage certifies that it must not recommend the strategy primarily to increase the likelihood of representing both sides, both parties.
19:42
SPEAKER_01: It must not recommend it primarily to retain commissions within the brokerage, and it must not recommend it to benefit the brokerage or licensee over the seller.
19:50
SPEAKER_01: And it must not use the strategy to obtain some other financial or competitive advantage inconsistent with the statutory duties.
19:57
SPEAKER_01: That's what it's all about.
19:58
SPEAKER_01: You have statutory duties that are beyond creating a competitive advantage for your company.
20:03
SPEAKER_01: That's pretty direct.
20:04
SPEAKER_01: And this is why I think brokerage owners need to pay very close attention to this guidance because there's another sentence here later in the document that I think could become incredibly important.
20:13
SPEAKER_01: The commission says licensees should approach limited marketing listings with thoughtful, professional judgment and careful adherence to fiduciary duties.
20:24
SPEAKER_01: Not as part of a brokerage's business strategy.
20:27
SPEAKER_01: And from what I am seeing down at the coast, this is a business strategy.
20:31
SPEAKER_01: This has nothing to do with what is in the best interest of your client.
20:35
SPEAKER_01: It is not going to help them sell their house quicker, faster, more money, better terms by limiting who sees the property to just the agents in your small brokerage.
20:44
SPEAKER_01: You know it, I know it.
20:45
SPEAKER_01: Quit lying to yourself about it.
20:47
SPEAKER_01: We're going to come back to this later because I think that statement has enormous implications on this national private listing debate.
20:53
SPEAKER_01: But before we get there, we need to understand the difference between these two scenarios.
20:57
SPEAKER_01: Because the commission's new form literally makes the brokerage pick one.
21:01
SPEAKER_01: This is my favorite part of the form.
21:03
SPEAKER_01: Not because it's flashing, it's just one little simple section, but I think it tells you exactly what the commission wants documented.
21:09
SPEAKER_01: Under brokerage certification, the brokerage has to select one of two boxes.
21:13
SPEAKER_01: Number one, the seller independently requested a limited marketing exposure listing.
21:17
SPEAKER_01: As I said, that happens, happens very, very rarely.
21:21
SPEAKER_01: Talk to a lot of agents who tell me that rarely happens.
21:23
SPEAKER_01: And so I've had agents who've been in the business for 20, 30 years tell me they've never had anybody ask for it.
21:27
SPEAKER_01: The second box is the licensee introduced a limited marketing exposure listing based on the seller's stated objectives and best interests.
21:34
SPEAKER_01: The reality of it is the licensees introducing it because their brokerage has this program and wants you to push it.
21:39
SPEAKER_01: But you've got to pick one.
21:41
SPEAKER_01: And I think that's incredibly significant because the commission wants to know whose idea was this?
21:46
SPEAKER_01: Did the client come to you asking for privacy, or did you sell the client on the privacy?
21:51
SPEAKER_01: Because those are two different risk profiles.
21:53
SPEAKER_01: Scenario number one, the seller asks for it.
21:56
SPEAKER_01: Let's say I have a seller who calls an agent and says, I'm going through a nasty divorce.
22:00
SPEAKER_01: I don't want my house plastered all over social media.
22:02
SPEAKER_01: I don't want to sign in the yard.
22:03
SPEAKER_01: I don't want my neighbors involved.
22:05
SPEAKER_01: I want as few people as possible coming through my property.
22:08
SPEAKER_01: Okay.
22:08
SPEAKER_01: The seller has articulated their objectives.
22:11
SPEAKER_01: They want privacy.
22:12
SPEAKER_01: That's their most important thing, not price.
22:14
SPEAKER_01: Now, the agent's job is to explain the consequences, not just say, yeah, that's great.
22:18
SPEAKER_01: Let's do it because it's also good for the brokerage.
22:20
SPEAKER_01: What they need to say is, I can absolutely discuss that limited marketing strategy with you, but you need to understand fewer people may know your property is available.
22:28
SPEAKER_01: Fewer showings could result in fewer offers.
22:31
SPEAKER_01: Fewer offers is going to be reduced competition.
22:33
SPEAKER_01: That could affect your sales price and terms.
22:35
SPEAKER_01: It could take longer to sell the property.
22:37
SPEAKER_01: Of course, there's also some fair housing issues we have to consider.
22:40
SPEAKER_01: If the seller says, I understand that, and privacy is still my top priority, I want to move forward, then that's great.
22:45
SPEAKER_01: You got your forms, you're documenting these conversations, and you now are protected.
22:48
SPEAKER_01: That's where this form's good.
22:50
SPEAKER_01: It's not just protecting the consumer, it's also protecting you as the real estate agent.
22:55
SPEAKER_01: Document it, that's informed consent, that's informed decision making.
22:58
SPEAKER_01: The agent isn't substituting their judgment for the sellers.
23:02
SPEAKER_01: The agent isn't deciding what the seller should value, the agent isn't making the decision, the seller is.
23:07
SPEAKER_01: Now, the seller has said, I value privacy more than I do exposure and price.
23:11
SPEAKER_01: And after receiving that information, the seller still directed the brokerage to proceed.
23:15
SPEAKER_01: That's exactly why the commission says these things are not prohibited.
23:18
SPEAKER_01: They're legitimate circumstances where they may make sense.
23:22
SPEAKER_01: Now, scenario two is different.
23:24
SPEAKER_01: The agent introduces it.
23:26
SPEAKER_01: Change the fact.
23:26
SPEAKER_01: The seller says, I want to sell my house, obviously I want the most money possible.
23:29
SPEAKER_01: But the agent says, before we go public, let me tell you about our exclusive private network, where we have highly qualified buyers who are ready to buy your house and we can set the market price and we can test the market and we can do all this BS that everybody knows is nothing but BS.
23:43
SPEAKER_01: Now, who introduced this limited exposure?
23:45
SPEAKER_01: The agent did.
23:46
SPEAKER_01: And that's when I think this guidance puts considerably more responsibility on the licensee.
23:52
SPEAKER_01: Because now the question becomes why?
23:54
SPEAKER_01: So what about the seller's stated objectives led you to conclude that reducing exposure was in the seller's best interest?
24:01
SPEAKER_01: And I don't think that answer can simply be because our company has these really cool marketing plans where we think we can get more money for the client.
24:07
SPEAKER_01: In fact, the guidance specifically cautions against approaching limited marketing lists as part of a broker's business strategy.
24:14
SPEAKER_01: So people have been put on notice right here.
24:16
SPEAKER_01: I also don't think the answer should be we have lots of qualified buyers.
24:20
SPEAKER_01: That's great.
24:20
SPEAKER_01: The MLS has more.
24:22
SPEAKER_01: The Internet has more.
24:23
SPEAKER_01: Zillow has more.
24:24
SPEAKER_01: The entire marketplace has more buyers than your single brokerage does.
24:27
SPEAKER_01: So enough with that.
24:29
SPEAKER_01: If the seller's objective is maximum exposure, maximum competition, explain to me why starting with your smaller little audience advances that objective.
24:38
SPEAKER_01: Maybe you can be amazed.
24:41
SPEAKER_01: Maybe you got some facts that might support it, but you better be able to articulate those facts to the real estate commission if you get a grievance.
24:48
SPEAKER_01: And that's the point.
24:49
SPEAKER_01: But we'll put it on the MLS later, is one of the responses I hear all the time.
24:52
SPEAKER_01: This is what you're bragging to me saying that I'm wrong.
24:54
SPEAKER_01: I've actually read some of your comments on my podcast from other agents at this company saying, well, they're not all being sold in-house.
25:01
SPEAKER_01: We put them in-house, 50% of our listings go in-house, but at the end of the day, about 80 or 90% make their way to the MLS, as if that somehow helps your argument.
25:08
SPEAKER_01: Think of that from the seller perspective.
25:10
SPEAKER_01: Why does your brokerage deserve the first shot?
25:13
SPEAKER_01: Can you explain that?
25:14
SPEAKER_01: What is the seller receiving in exchange for giving up the first few days or weeks of broad marketing exposure to limited marketing?
25:21
SPEAKER_01: Because isn't that especially important in a strong market?
25:24
SPEAKER_01: Isn't that the period we value the most, the beginning, the first few days?
25:28
SPEAKER_01: When it hits the market, it creates the excitement.
25:30
SPEAKER_01: Buyers have been waiting, they're happy, they want to see it.
25:32
SPEAKER_01: They immediately have people come look at it.
25:34
SPEAKER_01: Weekend showings line up, possibly get simultaneous offers, creates a sense of urgency, the competition.
25:40
SPEAKER_01: If we're deliberately diverting the initial opportunity to a small private pool, the fiduciary question remains why is that good for the seller?
25:49
SPEAKER_01: And don't misunderstand me, I'm not saying it can never be good for the seller.
25:52
SPEAKER_01: I'm saying you need to be able to answer that because according to the Real Estate Commission, if the licensees recommended limited exposure, the licensee should be prepared to demonstrate that that recommendation served the seller's best interest.
26:04
SPEAKER_01: And here's where the South Carolina guidance collides with what's happening nationally, because some brokerages aren't treating private listings as an unusual accommodation for the seller with unique circumstances, like EXP is doing.
26:15
SPEAKER_01: They're actually marketing private inventory as a feature of the brokerage.
26:20
SPEAKER_01: Enter Robert Refkin.
26:21
SPEAKER_01: List with us because we have exclusive inventory.
26:23
SPEAKER_01: Work with our agents because we have homes nobody else can show you.
26:26
SPEAKER_01: Our private network gives sellers an advantage.
26:28
SPEAKER_01: Now just stop with that shit already.
26:30
SPEAKER_01: Who benefits from your exclusive inventory?
26:33
SPEAKER_01: You do.
26:34
SPEAKER_01: And you're trying to use it to get both sides, control the data.
26:38
SPEAKER_01: The bottom line is the brokerage's benefit, the exclusive inventory is what you're using to try to attract agents to create the traffic for your portals.
26:47
SPEAKER_01: And you're trying to limit exposure to competitors, which means you're limiting exposure to other opportunities for their consumers to buy property.
26:54
SPEAKER_01: None of those things, standing alone, necessarily make the private listing illegal, but it does demonstrate why this conflict analysis matters because the brokerage might have a legitimate economic incentive to want the property private, but the fiduci continues to say the seller comes first.
27:10
SPEAKER_01: The fact that something is a great business strategy for the brokerage in terms of protecting your data and your listings and all of that and competing with Zillow does not necessarily mean it is a great marketing strategy for the seller.
27:21
SPEAKER_01: And that is exactly why the commission included this language.
27:24
SPEAKER_01: Think about how different those two conversations sound.
27:26
SPEAKER_01: Conversation number one is, Mr.
27:28
SPEAKER_01: Seller, you told me that because of your particular circumstances, privacy is extremely important.
27:32
SPEAKER_01: Here are the advantages, here's the disadvantages of limited exposure, here's your alternatives, here's the consequences.
27:38
SPEAKER_01: After discussing those, what do you want to do?
27:40
SPEAKER_01: Do you want to still proceed privately?
27:41
SPEAKER_01: That's client-centered.
27:42
SPEAKER_01: That's exactly what it needs to be.
27:44
SPEAKER_01: But conversation number two is different.
27:45
SPEAKER_01: Mr.
27:46
SPEAKER_01: Seller, everybody who lists their property gets access to our exclusive private network.
27:50
SPEAKER_01: We always have our listings there first because we have thousands of agents and buyers inside our ecosystem who are highly qualified buyers and they're ready to make great offers on your property.
27:58
SPEAKER_01: That is brokerage-centered.
28:00
SPEAKER_01: 100% brokerage centered.
28:01
SPEAKER_01: That's a violation of your duty.
28:03
SPEAKER_01: The commission is telling you very clearly which approach creates concern.
28:07
SPEAKER_01: If I was a broker in charge reviewing these forms today, and the agent checked, I introduced a limited marketing exposure listing, I would want to answer a question before I would sign it.
28:16
SPEAKER_01: Why?
28:17
SPEAKER_01: Give me the seller-specific reason, not the company reason, not the marketing presentation, not your recruiting pitch.
28:22
SPEAKER_01: Tell me what the seller told you that caused you as the agent exercising your professional duty under the statute and your fiduciary duty under the law to conclude that limited exposure was in this particular seller's best interest.
28:35
SPEAKER_01: And if the answer is, well, that's just what we do, I think we've got a problem.
28:38
SPEAKER_01: Remember, the language from the guidance, the commission says limited marketing exposure listings should generally be the exception rather than the ordinary course of marketing residential real estate.
28:49
SPEAKER_01: And then it says they should be approached with professional judgment and careful adherence to fiduciary duties and not part of a brokerage business strategy.
28:58
SPEAKER_01: That is a shut across the bowel.
29:00
SPEAKER_01: I know that sentence didn't accidentally find its way into this document because the national fight over private listings has increasingly become a fight over the business model.
29:08
SPEAKER_01: Who's controlling the listings, who's controlling the data, who's controlling the client, who's controlling the portal.
29:12
SPEAKER_01: But the South Carolina Real Estate Commission has now brought that conversation back to the most basic principle of agency law.
29:19
SPEAKER_01: Who is your client?
29:20
SPEAKER_01: Because if your answer is the seller, then every recommendation has to start there.
29:25
SPEAKER_01: Not with what grows your brokerage or builds your private network or keeps these transactions in-house.
29:30
SPEAKER_01: It starts with what is the seller trying to accomplish?
29:33
SPEAKER_01: And then how does limiting the number of people who know the property is for sale help accomplish that goal?
29:39
SPEAKER_01: If you've got a good answer for that question, you better document.
29:41
SPEAKER_01: If you don't have a good answer for that question, maybe you shouldn't be recommending a private listing in the first place.
29:46
SPEAKER_01: Well, that's where we're going to stop here today.
29:48
SPEAKER_01: We'll be back next week to go further through this document.
29:50
SPEAKER_01: I hope everybody enjoyed this week's show.
29:52
SPEAKER_01: Please like and subscribe.
29:53
SPEAKER_01: Please check that box up there to get subscription on YouTube.
29:56
SPEAKER_01: Help us grow this channel.
29:57
SPEAKER_01: Hope everybody has a great weekend, and we'll see you again next week for another episode of Disney.
30:02
SPEAKER_01: Y'all take care.