Velvet Ropes vs. Open Doors

What happens when the biggest brokerage stops sharing?

Earlier this month, Compass completed its acquisition of Anywhere Real Estate.

If that sentence didn’t land with a thud, let me put it differently: the largest residential real estate brokerage in the United States just swallowed the second-largest. In less than four months from announcement to close. (For $1.6 billion!)

The new entity, Compass International Holdings, now represents approximately 340,000 real estate professionals across 120 countries. It adds brands that are practically household names (no pun intended): Coldwell Banker, Century 21, Sotheby’s International Realty, Corcoran, ERA, Better Homes and Gardens Real Estate.

To say this is big is an understatement.

Credit Where It’s Due

Before I get to my concerns, I want to acknowledge something. Robert Reffkin, Compass’s founder and CEO, has built something remarkable. In just over a decade, he took Compass from a single office in New York to the number one brokerage in the country by volume. He did it by investing heavily in technology, recruiting top agents and teams, and moving faster than his competitors thought possible.

The man is relentless. He ran 50 marathons in 50 states to raise $1 million for charity. He founded a nonprofit to help first-generation college students. His mother was a real estate agent, and he built Compass in part to make her life easier.

And the speed of this merger? From announcement in September to close in January. Shareholders approved it overwhelmingly, and antitrust regulators didn’t seem to blink. That’s not luck, that’s execution.

But Here’s What Keeps Me Up at Night

The size of this company isn’t the story, but rather what Reffkin plans to do with it.

For the past two years, Compass has been building something called “Private Exclusives,” a network of listings that aren’t on the MLS. The pitch is straightforward: sellers can “test” their price within the Compass network before going public. No days-on-market accumulating. No price-drop stigma. Just quiet, controlled exposure.

Compass calls it “seller choice.”

Critics call it something else entirely.

The Case for Private Exclusives

To be fair, Reffkin isn’t wrong that some sellers want discretion. Think celebrity clients, high-profile divorces, and estates where publicity could complicate matters. There are legitimate reasons someone might want to market quietly before going wide.

And there’s a reasonable argument about days-on-market psychology. Once a listing sits, buyers start wondering what’s wrong with it. Test-driving a price without that blemish is tempting.

Compass also points to data suggesting that homes marketed through their three-phase strategy sell for 2.9% more than those listed immediately on the MLS. (Though Zillow and others have published contradicting studies.)

The Case Against

Here’s where it gets uncomfortable.

According to court documents from Compass’s ongoing lawsuit with Zillow, homes that start as Compass Private Exclusives are “double-ended” 71% more often than homes listed on the MLS.

Read that again. 71%.

Double-ending means the same brokerage represents both buyer and seller. When that happens on a Private Exclusive, Compass collects commission from both sides of the transaction.

Suddenly, “seller choice” could start looking a lot like “Compass’s choice.”

Critics argue that private listing networks fragment the market, reduce transparency, and ultimately hurt consumers by limiting exposure. Zillow’s attorneys called these listings “dark pools of inventory” being hoarded “behind a velvet rope.”

Why the Merger Matters

At last count, Compass’s Private Exclusives network had about 9,000 listings. Impressive, but not enough to fundamentally reshape the market.

But now Compass International Holdings controls roughly 20% of the residential market in many major metros. In some cities, that percentage is significantly higher.

With that kind of market share, a private listing network stops being a niche offering. It becomes a parallel universe.

Imagine a world where the best listings in your market never hit the MLS. Where your buyers don’t even know what’s available unless they call a Compass agent. Where the cooperative system that has defined American real estate for decades starts to look like a quaint relic.

Compass wants to control the entire consumer experience, from listing to search to close.

That’s not a criticism. It’s a description. Whether it serves consumers is the question.

What This Means for Harrisonburg (For Now)

Locally? Not much. Yet.

Neither Compass nor the Anywhere brands have significant presence in the Harrisonburg-Rockingham market. We’re a small pond, and they’ve been fishing in oceans.

If private listing networks become normalized, the ripple effects will reach us. Maybe through NAR policy changes. Maybe through state association rules. Maybe through the simple reality that sellers will see what’s possible in bigger markets and expect the same.

In short: the rules we operate under today may look very different in five years.

A Final Thought

I’ve never met Robert Reffkin. By all accounts, he’s brilliant, driven, and genuinely cares about agents and their clients.

But I also believe that the cooperative MLS system, for all its imperfections, has been one of the most consumer-friendly innovations in American commerce. It ensures that buyers can see what’s for sale. It ensures that sellers get maximum exposure. It creates a level playing field for agents of all sizes.

What happens when the biggest player decides the playing field should tilt in their direction?