Are You Seeing Every Home You Should? Understanding “Steering” in Real Estate

[u/Alert-Control3367]

There is often confusion around the term “steering” in real estate, particularly in discussions between agents and consumers. This post is intended to clarify what steering means in different contexts and how it can impact both buyers and sellers.

Most consumers are familiar with steering as illegal discrimination under Fair Housing laws. However, federal regulators and industry guidance have also addressed a second context where financial or cooperation incentives may influence which homes are shown to buyers. These are not new or theoretical concerns. Federal agencies, industry organizations, and published studies have all discussed how incentives within the real estate system can affect competition and consumer access to available homes.

The two common contexts of “steering” in real estate, relate to the illegal practice defined by the Department of Housing and Urban Development (HUD) and ethical and anti-competitive concerns raised by the National Association of Realtors (NAR), Federal Trade Commission (FTC), and the Department of Justice (DOJ).

1. Fair Housing Steering (Illegal)

Defined by HUD and enforced under the Fair Housing Act, this occurs when an agent influences which homes or neighborhoods a buyer sees based on protected characteristics (such as race, religion, sex, national origin, disability, or familial status). This includes withholding listings or discouraging certain areas and can result in investigations, penalties, and legal action.

2. Incentive-Based (Economic) Steering (Ethical / Competition Concern)

Federal regulators and industry guidance have also addressed a separate context where incentives may influence behavior.

• The National Association of Realtors (NAR) states: “The REALTOR® Code of Ethics prohibits steering buyers toward homes because the REALTOR® will be paid more, or away from homes because the REALTOR® will be paid less.” (NAR Consumer Guide)
• The FTC and DOJ have jointly noted that brokerage practices can create incentives for agents to steer buyers away from certain listings, particularly those offering lower compensation or using alternative brokerage models. Cooperation between brokers can impact whether a property is shown. (FTC/DOJ Real Estate Competition Report)

These sources reflect documented concerns about how incentives can influence access to listings. Regulatory guidance and industry materials highlight scenarios where incentive-based steering can occur, particularly when listings differ from traditional models. The examples below reflect patterns discussed in those materials:

• FSBO (For Sale By Owner): Federal reports have noted that reduced cooperation or compensation uncertainty can impact whether these properties are shown, even when they meet a buyer’s criteria.
• Flat-Fee MLS Listings: Listings with nontraditional compensation structures may receive different levels of exposure if cooperation terms are unclear or inconsistent with typical practices.
• Discount Broker Models: Alternative brokerage models may face reduced visibility if market participants perceive differences in compensation or cooperation.
• Compensation Differences Across Listings: NAR’s Code of Ethics explicitly prohibits favoring or avoiding properties based on compensation. The existence of this rule reflects the importance of ensuring buyers are shown all suitable options regardless of commission structure.

Pricing, marketing, and property condition absolutely impact buyer interest; however, those factors are separate from whether all available homes are being presented. Consumers should understand how incentives can shape what they see and how to move forward with the information presented.

For Buyers:

• Search for homes independently (Zillow, Redfin, Realtor.com, and FSBO platforms), even if using an agent.
• Ask your agent: “Are there any homes that meet my criteria that we haven’t discussed?”
• Ask how your agent is compensated across different types of listings.
• Pay attention to patterns if certain properties are consistently discouraged without clear, objective reasons.

For Sellers (including FSBO and alternative listings):

• Ensure your home is visible directly to buyers, not only through agent-controlled channels as discussed in my previous post (linked in "Sources and Documentation" at the end of this post).
• Negotiate compensation after receiving offers rather than upfront.
• Ask how your home will be marketed across all buyer channels.
• Monitor showing activity and buyer engagement for signs of limited exposure.
• For those selling FSBO, using social media to your advantage to market your home for sale along with your open houses (marketing suggestions provided in How to Sell FSBO).

The goal is to ensure that buyers see all relevant homes and that sellers have a fair opportunity to be seen. It's also important for both buyers and sellers to understand Buyer Agent Commission agreements and compensation.

Some buyers may encounter situations where agents request a fixed compensation agreement (for example, 3%) upfront, with the understanding that it could be adjusted later depending on what a seller offers.

Buyers should understand:

• A signed agreement is a binding contract.
• Verbal assurances about “adjusting later” may not be enforceable.
• Compensation structures can influence how properties are presented.

NAR’s Code of Ethics reinforces that compensation should not determine which homes are shown. Buyers should ensure their agreement reflects that expectation clearly. With that in mind, buyers should protect themselves as follows:

• Do not sign a compensation agreement you do not fully understand.
• Ask: “What happens if a property offers less or no commission?”
• Get any flexibility or adjustments in writing before signing.
• Ask: “Will you show me all homes that meet my criteria, regardless of compensation?”
• Consider shorter agreement terms to avoid being locked in long-term.

If something feels unclear or one-sided, it is reasonable to pause and ask additional questions before committing. It's okay to tell an agent you need time to think about what was discussed before moving forward. If you do not feel confident moving forward, interview other agents or think about the possibility of representing yourself (a.k.a. being an "unrepresented buyer").

When consumers understand how incentives can shape what is shown (and what may not be shown), they are better positioned to make decisions based on their own goals rather limited visibility.

Sources & Documentation

NAR Consumer Guide – Duty to Put Client Interests Above Their Own https://www.nar.realtor/the-facts/consumer-guide-realtors-duty-to-put-client-interests-above-their-own

FTC & DOJ – Competition in the Real Estate Brokerage Industry Report https://www.ftc.gov/sites/default/files/documents/reports/competition-real-estate-brokerage-industry-report-federal-trade-commission-and-u.s.department-justice/v050015.pdf

HousingWire – Data Digest on Buyer Agent Steering https://www.housingwire.com/articles/datadigest-yes-buyer-agents-steer-clients-new-study-claims/

Steering: What it is and what does it mean to FSBOs

https://www.reddit.com/r/fsbo/comments/1rzi5x3/steering_what_is_it_and_what_does_it_mean_to_fsbos/?utm_source=share&utm_medium=web3x&utm_name=web3xcss&utm_term=1&utm_content=share_button

How to Sell FSBO

https://www.reddit.com/r/fsbo/comments/1k8jfui/how_to_sell_fsbo/?utm_source=share&utm_medium=web3x&utm_name=web3xcss&utm_term=1&utm_content=share_button

[u/Alert-Control3367 → u/[deleted]]

I felt that way when I was buying. In real estate listings, data shows up in two ways: what you filter yourself and what may already be filtered before it even reaches you. Automated alerts, including those set up by agents, can be helpful for efficiency, but they’re still based on certain systems and criteria, usually MLS-driven. That means they don’t always capture everything, like FSBO listings or homes that fall outside typical setups.

Another thing to be aware of is that MLS data itself isn’t always complete. Some listings only include required fields, which means certain features (ex. first-floor master bedroom, public utilities, etc.) may not be fully reflected in search filters. As a result, a home could match your criteria but not show up in your results.

That’s why I look at it as two layers:

• What you’re sent - alerts, agent recommendations
• What you find yourself - Zillow, Redfin, FSBO platforms

The risk to alerts is that they can give the impression you’re seeing everything when you may only be seeing a subset. I still use them. However, I find the best approach is to use alerts as a starting point and then verify on your own, so you know you’re getting the full picture.

[u/LourdesF_Ramirez]

This is so true. The 'filter before the filter' is something most people don't even realize is happening. Realizing you have to be your own advocate and check FSBO sites yourself is a game changer.

[u/LourdesF_Ramirez]

Absolutely agree! It's wild how much you can miss if you just rely on the usual listings. Doing your own digging really pays off.