REALTORS® have spent millions of dollars to develop Multiple Listing Services (MLS) and other real estate technologies that make the transaction more efficient. An MLS is a private offer of cooperation and compensation by listing brokers to other real estate brokers.
In the late 1800s, real estate brokers regularly gathered at the offices of their local associations to share information about properties they were trying to sell. They agreed to compensate other brokers who helped sell those properties, and the first MLS was born, based on a fundamental principal that’s unique to organized real estate: Help me sell my inventory and I’ll help you sell yours.
Today, through more than 800 MLSs, brokers share information on properties they have listed and invite other brokers to cooperate in their sale in exchange for compensation if they produce the buyer. Sellers benefit by increased exposure to their property. Buyers benefit because they can obtain information about all MLS-listed properties while working with only one broker.
The real estate market is competitive, and the business is unique in that competitors must also cooperate with each other to ensure a successful transaction. MLS systems facilitate that cooperation.
The MLS is a tool to help listing brokers find cooperative brokers working with buyers to help sell their clients’ homes. Without the collaborative incentive of the existing MLS, brokers would create their own separate systems of cooperation, fragmenting rather than consolidating property information.
MLSs are a powerful force for competition. They level the playing field so that the smallest brokerage in town can compete with the biggest multi-state firm. Buyers and sellers can work with the professional of their choice, confident that they have access to the largest pool of properties for sale in the marketplace.
Real estate information on the Internet is readily available. Consumers can access and view all publicly available listing information on the Web site of their broker of choice.
MLSs are private databases that are created, maintained and paid for by real estate professionals to help their clients buy and sell property. In most cases, access to information from MLS listings is provided to the public free-of-charge by participating brokers. Data that is not publicly accessible includes information that would endanger sellers’ privacy or safety, such as seller contact information and times the home is vacant for showings.
NAR encourages innovation and competition in real estate brokerage, including different business models. NAR members are affiliated with real estate brokerage firms that operate using various business models, including full service, limited service, fee-for-service, and discount (regardless of the level of service). Internet positioning in itself is not a business model – nearly 90 percent of REALTORS® report that their firm has a Web site for business use, according to the 2007 NAR Member Profile.
According to the 2007 REALTOR® Technology Survey, two-thirds of all REALTORS® have Web sites, and REALTORS® report that their listings are displayed on any number of Web sites, including REALTOR.com, the REALTOR®’s own site, the local REALTOR® association’s Web site, the local newspaper site, Yahoo, Google, CraigsList, Zillow and Trulia.
More than half of recent buyers used MLS Web sites in their search, according to the 2007 NAR Profile of Home Buyers and Sellers.