Want to sell a WA home? Your broker can’t keep it hush-hush

Submission Statement: I am not a homeowner, so this is something I haven't really thought about it in the past, but I found it interesting. Should home sales be required to be open to a public market? Arguments for are that it protects against housing discrimination and improves access to the highest-level housing/communities. Arguments against are basically that sellers want control over their sales process. Does a regulation like this make the market more or less free?

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The Washington Legislature nearly unanimously passed a bill Wednesday banning real estate brokers from marketing the sale or lease of residential real estate to an exclusive group.

Senate Bill 6091 goes to the governor for final approval. If it becomes law, brokers advertising a home to an exclusive group of people must also market the home to the general public and all other brokers. It would take effect June 10.

The legislation comes amid a heated debate among major real estate players over private listings. Some argue sellers should be allowed to market their homes however they wish. But others say that’s not fair and leaves a door open for discrimination in home sales. The issue has sparked similar bills in other states, including Wisconsin, Illinois, Hawaiʻi and Connecticut.

The dispute is especially fraught in Washington, where private listings are already rare — the Northwest Multiple Listing Service (a membership organization with a database of property listings across Western Washington that feeds home-shopping websites, including Zillow and Redfin) bans them.

The bill’s primary sponsor, Sen. Marko Liias, D-Edmonds, said he wanted to enshrine the ban in law, especially since NWMLS faces ongoing legal challenges over its rule.

“(Private listings) really did stand out as something that’s anticompetitive,” Liias said in an interview Thursday. “It really just smacks of some of the discrimination and exclusion that we’ve seen in the past.”

Up until federal fair-housing protections took hold in the mid-20th century, property deeds in Washington commonly included clauses preventing the sale of property to nonwhite people. Tens of thousands of Washington homeowners can still find these clauses in their property records, according to the University of Washington. Liias said he’s one of them.

“We have a sad and long history of exclusion and discrimination,” Liias said. “I was immediately skeptical that any kind of exclusive or private model would have positive impacts for first-time buyers, for diverse communities.”

The bill only applies to brokers — not property owners who want to privately market homes themselves. For example, a homeowner could privately agree to sell their home directly to a neighbor. On the other hand, if that homeowner hired a broker to advertise their home to a select group of their favorite neighbors, that would violate the law.

But that doesn’t mean a home seller must put up a for-sale sign or allow people into the residence. The bill doesn’t specify how brokers must publicly market homes.

The bill also has an exception — private listings are allowed if the health or safety of an owner requires it. Liias’ legislative staff confirmed that survivors of domestic violence and famous people could be exempt, but brokers would need to document those reasons in transaction files.

A broker who violates the law could face consequences from the Washington State Department of Licensing, including revocation or suspension of their license and up to $500 per violation, according to a final bill report. 

Compass sues 

The debate over private listings has reignited in recent weeks, since Rocket Companies, owner of Seattle-based Redfin, announced its intention to syndicate “coming soon” and private listings from the real estate brokerage Compass.

Compass has led the charge for private listings, especially since it began ramping up its exclusive inventory in 2024.

Compass argues private listings allow sellers to test the market among a small pool of buyers without accumulating “days on market,” which can affect home prices.

But the Seattle-based real estate giant Zillow, which shows home value estimates and days on market, has publicly pushed back. The company claims private listings have the potential to reinforce segregation and leave many shut out of opportunities.

Last year, Zillow banned any listings that were marketed before being added to the MLS.

Compass sued Zillow over its ban, accusing the company of stifling competition and monopolizing the market. But last month, a judge denied Compass’ preliminary injunction to block Zillow’s ban.

Compass has also filed a lawsuit against NWMLS for its private listing ban, which is ongoing.

Cheers and jeers

Zillow, NWMLS and the Washington Realtors, an affiliate of the National Association of Realtors, expressed their relief at the bill’s passing.

“We’re proud to see our home state lead the way in making the process of buying or selling a home more transparent and fair for everyone,” Zillow said in a news release.

Nathan Gorton, CEO of the Washington Realtors, which lobbied for the bill, said the ban is ultimately what is best for consumers.

“There are parts of the state where this could be used,” he said. “We thought it was important as an industry to make a statement about what the right way to do real estate is.”

NWMLS CEO Justin Haag said SB 6091 is consistent with NWMLS’s policy banning private listings and will promote a fair and comprehensive marketplace.

“When a home is for sale, it should be available to all consumers and all brokers — not merely a select few,” he said in a statement.

Compass did not respond to a request for comment.

However, Brandi Huff, managing director for Compass in the Northwest, testified against the bill in a Jan. 23 Senate Housing Committee hearing, telling lawmakers that the bill would only benefit third-party real estate listing platforms.

“The state should not be legislating to protect the data-scraping interests of tech platforms at the expense of homeowners’ rights to decide how their largest asset is marketed,” she said.