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How does the real estate MLS work?

How does the real estate MLS work?

July 17, 2020

How does the real estate MLS work?

Real estate MLS work

Real estate agents have an incredibly powerful tool at their disposal: your multiple listing service.

The MLS is a centralized clearinghouse of information for participating brokers and agents. By working together, real estate professionals can share detailed information about properties with one another and expand the range of potential buyers who may be interested in individual homes, storefronts, industrial plants and other types of buildings.

You can view the MLS as a force multiplier. It enables you to bring a wider array of potential homes to the attention of your clients, and to have the properties your clients are attempting to sell listed for consideration by many other real estate professionals.

Let’s answer some key questions about the MLS as a primer for new real estate agents and experienced ones who may need a quick refresher.

What does the MLS stand for in real estate?

MLS is an initialism that refers to a multiple listing service. This tool has been leveraged by professionals in real estate brokerages along with individual real estate agents for mutual benefit. An MLS makes it easier for their clients to buy and sell properties that appeal to their specific wants and needs, which has the key benefit of improving profits for agents and brokers.

While digital MLS solutions are a relatively new and useful invention, the concept dates back to far before computers were common office equipment. The National Association of Realtors pointed to the late 1800s as the time when the concept first emerged. Brokers gathered with others from their local area and shared information. They also reached a crucial understanding about also sharing compensation when a property listed by one broker is sold by another.

With this mutual benefit driving the usefulness of such gatherings, acceptance and use of MLS systems grew. Now, real estate professionals can quickly review multiple listings and share that information with their clients. Critically, an MLS will also provide information about the commission involved. This helps real estate professionals understand key financial aspects of their work buying and selling homes.

Is there just one MLS system?

There isn’t a single authority or MLS solution used by all real estate agents and brokers in the country, as Investopedia explained. Instead, there are many different MLS platforms that real estate professionals can choose to join. Generally, each system involves a recurring payment that ensures access. Depending on the real estate market in your area, you and your broker may work with a few or many MLS systems.

How do you use an MLS?

As we previously discussed, MLS platforms generally limit access to due- or fee-paying real estate professionals. While there are workarounds that some especially motivated individuals may use, the information contained in a given MLS is generally limited to the professionals who pay for access. This is the critical first step in successful use of an MLS – gaining access.

From there, you’ll have to develop some proficiency with the specific system. Individual MLS solutions can vary in their particulars, but the goal of identifying properties for sale is common across all of them. You can reach out to your broker or more experienced agents with specific questions or for general advice.

With an understanding of the MLS systems you’ll commonly use, you can start leveraging them to seek out listings that are in line with your clients’ expectations. The deep amount of data provided through an MLS means you can focus on specific attributes, such as lot size, date of construction and many others, in an efficient and reliable format.

Are sites like Zillow MLS platforms?

There is an important distinction between MLS platforms and websites like Zillow. While these sites offer much of the same general data about the properties listed for sale, and can be especially useful for identifying direct sales by owners, they aren’t exactly the same as an MLS.

An MLS solution will also contain information that’s relevant to real estate professionals but not clients, such as the commission offered for a sale. Zillow and similar websites don’t offer these details, making them less valuable for brokers and agents. That doesn’t mean you can’t direct your clients to these websites if they want to take an active role in searching for properties.

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