For many home sellers, listing their home on the MLS (Multiple Listing Service) isn’t even a decision – it is just part of the process. More than 80% of the homes sold in this country were listed in their local MLS.
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How Does the MLS Work?
MLS has its roots in the 1800s. An agent would visit another close agent’s office to receive a report on different properties and pricing. With the development of technology, this network has become digital. Now, all brokers are users of different local and national MLS groups. Most MLS groups are local brokers buying and selling homes in your area. Rather than a single service, the MLS is actually a suite of around 800 regional services used by real estate brokers around the country to share information. There are large composite national MLS listings that are compiled through local MLS databases. The MLS databases updates regularly as new houses and properties are bought and sold on a weekly and monthly basis. An MLS listings search is often the first step a buyer’s agent will take when working with a new client.
The MLS is a mutually beneficial service between brokers that are buying and selling homes. There are no regulations on how the MLS operates, but individual brokers adhere to the National Association of Realtors (NAR). One stipulation is that the commission for the broker must clearly be stated in the agreement. When brokers use MLS often the broker who sells and the broker who purchases will both receive a preapproved payment for facilitating the process. The MLS does not typically include mortgage, loan, and financial services, but just connects buyer to seller.
How Do I List my House on the MLS Listings?
Only licensed real estate brokers can add a property to the MLS. When you list your home with a broker, this is part of the service they provide (unless you specifically request not to be listed). However, there are also online services (like Fizber.com) ready to get your home listed on the MLS for a flat fee (rather than the commission charged when you list the property with a real estate agent).
Do I Need the MLS Listings Search?
Increasingly, sellers are questioning whether or not they really need the MLS. In the past, a small percentage of homes sold were “pocket” listings – handled by a broker, but not listed on the MLS. These were mostly high-end luxury homes or celebrity properties. Also, there have always been FSBO (For Sale by Owner) properties that often rely on yard signs and word-of-mouth. This starts to put the seller at risk if the buyer has a low credit score and/or doesn’t end up closing on the deal. There is no insurance when selling a home privately. Regardless of how you sell your home there will be hidden costs, and money will go towards unforeseen expenses.
If you’re selling your home FSBO, don’t do it old school. Yes, put a sign in your yard, check the newspaper, and tell all your friends, but also take advantage of 21st-century innovations. Post and repost your home on social media (using professional-quality photos), create a virtual (video) tour, and consider all the different online options – including the MLS.
The internet, of course, has transformed our lives in so many ways – and it’s transforming the real estate market as well. Lenders and other traditional brick-and-mortar establishments are increasing their online presence. This also means FSBO home sellers today have more options than ever. They can list their property on the MLS using a variety of flat-fee online services, but they can also gain exposure – and sell their property – using sites other than the MLS (Redfin, Zillow, Fizber) – many of which are free! In a time when up to 95% of home buyers start their search on the internet, these sites can give a property much-needed exposure, as various buyers seek after different housing options.
So, let’s examine the pros and cons of listing on the MLS.
Pros and Cons of Listing on the MLS
– Pros
Exposure – All licensed real estate agents have access to the MLS. Most potential buyers are going to be using agents to help them find homes, so this is a great way to cast the widest possible net.
Level Playing Field – The MLS allows all brokers who are part of the system to post and view available homes. This is extremely beneficial for low level brokers because they are able to use the MLS to the same extent as large well-funded brokerage firms.
No FOMO (fear of missing out) – By not being on the MLS, which the vast majority of listings are, you may worry that you’re missing out on prospective buyers.
– Cons
Privacy Concerns – Most sellers want to get as much exposure as possible for their property. But some sellers don’t want to deal with a parade of realtors and potential buyers. In a seller’s market, they may have the luxury of being extremely selective about who gets to see their home – and still find a qualified buyer. However, the MLS limits how much sensitive and personal information is included about the home. For example, it will not describe when the home is vacant, or current occupants living there.
Exclusivity – Sometimes, people are more excited by a property they perceive to be exclusive. The idea that not everyone can even view your home may be an incentive for some buyers to make sure they are among those who DO get to see it. This also may make them bid more aggressively on the property if they do like it – and that could mean a higher sale price for you.
Financial – Only a licensed real estate broker can enter a new listing on the MLS. If you list your property with an agent, you’ll pay a 2.5% to 3.5% commission on the sale of your home. There are also “a la carte” brokers and flat-fee services where you pay a one-time fee rather than a commission. But unless you yourself are a broker, there is no way to get your listing on the MLS without paying some kind of fee.
Conclusion
There is no one-size-fits-all answer to the question of whether or not you need the MLS. A lot depends on the market (a buyer’s market versus a seller’s market), as well as your willingness to rely on alternative methods. Carefully consider your needs and priorities as a seller before deciding on an MLS Listing for your home.
SOLD.com is here to help you whether you are buying or selling a home. SOLD.com differs from an MLS because it also allows non-realtors and companies to access the server, which only expands the market. A major difference between SOLD.com and other organizations is that no money is received by different services bidding in order to offer you services. We assess your needs and find the best solution for you. Take our quiz to see your options!
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