What Is a Multiple Listing Service (MLS) and Why Is It Important to Your Home Search?
The MLS is your key to a smoother, faster real estate transaction
Highlights
The MLS allows realtors to share information about their home listings.
The MLS connects buyers and sellers for faster transactions.
The MLS provides real estate agents with important information on existing properties.
The multiple listing service (MLS) is a tried-and-true real estate tool that dates back over 140 years. While it still exists today and looks dramatically different from where it began, it has remained true to its original purpose—to encourage cooperation among realtors and facilitate real estate transactions.
Whether you’re buying or selling your home, the MLS is an incredibly helpful tool. Let’s walk through how the MLS works and why it’s important to your home search.
What Is the Multiple Listing Service (MLS)?
While the technology powering the MLS has changed, the system has stayed true to its original intent—to serve as a comprehensive database of the homes for sale in a particular region. With the help of the MLS, real estate agents can see all of the properties for sale in a given region, and buyer’s agents can use the MLS to find scores of homes to show their clients.
The Real Estate Standards Organization reported that there were about 597 MLSs in the United States in 2020. In comparison, Canada only has about 39 MLSs, and in most countries, MLSs don’t even exist. Real estate professionals typically pay dues or a membership fee to access the MLS, and it’s exclusive to real estate agents and brokers.
What Kind of Information Is on the MLS?
Essentially, the MLS contains all publicly available real estate information on properties for sale. Each MLS listing is different and contains the information the listing agent chooses to include, but, typically, the information on each home listed on the MLS includes:
Detailed descriptions of the home
The listing price
The number of bedrooms and bathrooms
The number of days on the market
Property taxes
Age of the home
Size (square footage)
Any unique home features
Photos of the interior and exterior of the home
The listing agent’s information
MLS may also include the homeowner’s private contact information and a schedule for upcoming open houses. In some cases, confidential documents like the seller’s disclosures might be made available, too.
Are All Home Listings on the MLS?
While the MLS is a pretty comprehensive listing of local properties for sale, there are some properties that won’t make it to the MLS. Here are the types of listings that won’t be on the MLS:
For sale by owner (FSBO) listings: FSBO homes are typically not included in the local MLS database. As the name implies, these homes are being sold exclusively by the owner, and a real estate agent must list your home for it to make it on the MLS.
Pocket listings: This type of property listing is a home that a broker keeps under wraps or “in their pocket.” Typically, when an agent has a pocket listing, they will only share the details of that listing and accept offers from a select group of clients.
What Are the Benefits of Using the MLS?
The MLS ensures that real estate professionals (even competitors) cooperate to facilitate all real estate transactions. Ultimately that type of cooperation benefits everyone, including sellers, buyers, and real estate professionals.
The MLS is the key to a veritable treasure trove of property listings for real estate professionals. Ultimately, the MLS can increase competition and allow agents to maximize their earnings.
For sellers, the MLS exponentially increases the exposure of their property listing. In fact, by using the MLS, sellers can ensure that their property listing is seen by a wider range of potential buyers, which may help sell the home quickly. Plus, agents and brokers can monitor the MLS and make price adjustments to their listings as needed. In comparison, a property that’s not featured on the MLS will have a limited pool of potential buyers.
What Are the Drawbacks of Using the MLS?
The MLS makes real estate transactions far more efficient than they would be otherwise. For that reason, there are no real drawbacks to the MLS save for the effect they may have on larger real estate firms, top brokers, and their bank accounts.
By aggregating information on homes for sale in a local market and making it readily available to any agent with a real estate license, the MLS essentially levels the playing field. Some people may consider the cost of posting on the MLS to be a drawback because sellers have to either pay an agent or the flat fee MLS.
FAQs About the MLS
Check out these FAQs to answer any of your lingering questions about the MLS.
Can potential buyers search for homes on the MLS?
Technically no. While the multiple listing service is open to real estate professionals like agents and brokers who pay membership fees and dues, it is not available to the public.
However, brokers often share MLS information and listings directly through their brokerage websites (and it’s usually free of charge). Keep in mind that some of the information shared on brokerage websites may be withheld for privacy reasons.
How do online listings compare to home listings on the MLS?
It’s worth noting that while potential buyers can find home listings online, that information may not be up-to-date, and it may not include all of the homes listed on the MLS. In comparison, the MLS is updated multiple times per day, and real estate professionals can see the updates in real-time.
What is a flat fee MLS?
A flat fee MLS network allows homeowners who have FSBO listings to list their homes on the MLS for a one-time fee. With a flat fee MLS listing, the lion's share of the home selling process is still up to you, but you’ll be able to market your home to a wider range of buyers through the MLS.