What is the MLS Anyway?

What is the MLS Anyway?

You may have heard your Realtor use MLS in some of their real estate jargon. What exactly is an MLS? MLS is an acronym for multiple listing service or system. Wikipedia describes it as a suite of services that (1) enables brokers to establish contractual offers of compensation (among brokers); (2) facilitates cooperation with other broker participants; (3) accumulates and disseminates information to enable appraisals; (4) is a facility for the orderly correlation and dissemination of listing information to better serve broker's clients, customers and the public. In layman's terms the MLS is a central database that participating real estate brokers and agents use to share information about properties. Realtors primarily use it in their day to day operation to find properties for buyers and to help sellers arrive at a value for their properties based on sold and unsold like kind properties. The MLS system is also the most important marketing tool that a Realtor or Broker can have. Participating members of the multiple listing system list their inventory of properties for sale in the database as a way to market them to other members who may have a potential buyer. Realtors working with buyers can sell properties listed by other Realtors in return for compensation. Typically the commission is split by the listing agent and the selling agent. In other words if a seller is paying a 6% commission the listing agent will pay 3% to a Realtor who represents the buyer who purchases his listing. The majority of closed transactions do involve two Realtors. The United States real estate system allows buyers to confidently work with one Realtor that is a participating member of an MLS system since that agent can access virtually all properties for sale. This is different from Europe where there real estate agents typically do not use a central database known as an MLS. There is a misconception by some of the general public that they need to hire multiple Realtors to view all of the properties for sale in the marketplace. You really just need to hire one good agent to represent you in a purchase. From a seller's perspective it is wise to choose a Realtor that can list your home in the MLS database. This is a Realtor's most powerful marketing tool. When your agent enters a property in the MLS database it becomes available to thousands of Realtors and their potential buyers. In most real estate markets the MLS contains virtually all of the properties for sale. Other important facts about the MLS: • There is no national single MLS. • Local Realtor Associations oversee the MLS system. • MLS is trademarked term owned by Major League Soccer • Most MLS's do not have an access for the general public • IDX is known as internet data exchange. This allows a portion of MLS data to be displayed on Realtor websites. When you see "Search MLS" on a Realtors website most of the time you are not accessing the real MLS system. • Realtors have to pay money to join a local Realtor association in order to access the MLS system.