The National Association of Realtors is cracking down on " private listings ," properties that aren't listed publicly on the multiple listing service and get shown to only a handful of buyers.

The industry group recently adopted a policy that requires its agents to submit a real estate listing to the MLS within one business day of releasing any marketing information. This includes yard signs, fliers, listings on the firm's website or emails to agent groups.

Agents who run afoul of the rule could face fines of as much as $5,000. The policy will be enforced by the 630 NAR-affiliated multiple listing service (MLS) groups, which are expected to adopt the plan by May 1, 2020. The rules are already in effect in some areas.

Multiple listing services are a network of databases that agents use to share their listings with the widest possible audience . Once a property is listed on a local MLS, it can be accessed by agents around the country and gets picked up by major home buying websites, like Zillow and Trulia. The benefit to buyers is that they can easily access information about all properties on the market while working with one agent. Sellers, meanwhile, can maximize the number of buyers that have access to their listing.

But what affect will the changes have on buyers and sellers?

For buyers

"This new rule reassures buyers that they are looking at all available inventory," said Rene Galicia, director of MLS engagement for NAR. "It reduces the segmentation and expands choice for them."

Previously, buyers who wanted to see all available properties for sale needed to visit multiple websites or find agents who belonged to particular agent networks with access to private listings.

"And still they didn't see that one house near the school they want their kids to go to because it wasn't on the MLS," says Jon Coile, the executive chairman of Bright MLS, which covers the Mid-Atlantic. "When sales begin to get pulled out of the MLS, it has negative consequences for everyone."

Bright MLS had been studying its markets during the past year and noticed a trend -- more listings were being marketed to buyers off MLS.

They saw listings popping up on closed Facebook networks that only a small number of agents have access to. Other listings were email blasted to an exclusive network of agents.

"An exclusive network is by definition excluding people," he said. "It isn't fair when you limit who can look at a house."

The new rule also aims to ensure that markets already experiencing low inventory will not be further constricted by a smaller number of homes on the MLS.

"Buyers now will have access to everything that is listed," said Coile. "Inventory is down, there is less to choose from, you make it worse when you take a percentage away and hide it so not everyone can see it."

One appeal of private listings for buyers is that they get to break away from the pack of other hungry buyers and may find less competition.

But even without private listings limiting the supply of available homes, competition will remain stiff in hot markets, according to Matthew Woebcke, a real estate agent in San Francisco. In the Bay Area, he said, even private listings have had multiple offers. "Maybe they have five [offers] instead of ten, but there is still competition."

Woebcke doesn't expect as much change for buyers or sellers as there will be on the back end for agents.

For sellers

While sellers may get broader exposure for their property through the MLS, some found private listings to be a way to test the waters and make price adjustments before being widely distributed on the MLS.

"I've had great success with private listings," said Theo Adamstein, an agent at TTR Sotheby's International Realty in Washington DC, who until now had about 10% of his business from private listings. "It was what my clients wanted. They ended up with the price and the smooth closing that they expected."

Adamstein appreciates that the ruling addresses fair housing concerns, but laments the rule as the loss of a way to test the price of a property before the "days on the market" clock starts ticking. Often the longer a property is on the market, the less desirable it appears to buyers, which may mean a drop in price.

Cory Perkins, head of inventory strategy and operations at Compass, said the new rule could complicate a "coming soon" pricing strategy that Compass offers to sellers. The strategy allows homeowners to list their property on the Compass website prior to going on the MLS, during which time the price may be tweaked based on feedback.

"We can test the market and better understand the price we should market the home for," he said. "Then we can sell it faster."

This new rule does not completely take away private listings, said Coile. It does ensure that private listings, which may be necessary for a high profile seller with a recognizable name who needs to maintain the privacy of their residence, stay private within a single brokerage firm.

But the aim of the ruling is to reserve that treatment for situations that necessitate it, not just for those who prefer it.

"If it is truly private, that's fine," says Coile. "But you can't be public about the listing, putting it everywhere but the MLS and then call it a private listing."