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Realtors and the MLS database
Excerpts from Marke****ch -
This week, the US Dept of Justice filed suit against the National Association of Realtors, saying the trade group's policy regarding the online use of home sale listings from its MLS database is anti-competitive. Realtors think they own the data about your house. And they have jealously guarded that "ownership," which was a lot easier to do before the Internet age. In this new world, real estate agents do not distinguish themselves because they have exclusive access to listings data. They create value by providing a wide array of services and analysis - not information that consumers can get themselves. It's not hard to imagine the day when there is one giant public database of all the housing stock in the US that contains all the information about a property that you would expect to find on a standard listing sheet. All you would have to do if you wanted to sell is set an alert on your file, and any for-sale searches would turn up your house. Who would own that data? Like any public record, we all would. Would we still need a million realtors then? That may be the real issue in this debate. |
Steve wrote:
Would we still need a million realtors then? That may be the real issue in this debate. One good thing about the large quantity of realtors is that it is creating a lot of downward pressure on commissions. You can sell a million dollar house for around $10,000 in commission now, where as in the past some people paid as much as 6%, and the average was somewhere between 4% and 5%. There is one real estate company in Silicon Valley that has taken out these bizarre advertisements, claiming that they get more money for your house than discount real estate companies, and the difference is more than what you save in commission from a lower cost real estate company. However their data is highly flawed, and they actually admit as much in the fine print, which I assume that they hope no one reads. |
In H-town Texas, it has been 3% for a while now. However, most of my
realtor friends give back some money(commission) to their customers in order to get their business. One of my realtor friends is only charging 1%. He is counting on doing volume. |
"By the way, MLSs get most of their data from the public sources too.
Whatever noises dumb realtors and appraisers make from time to time about ownership of the data, these go away fairly fast. The reason is that you can't copyright facts! " I don't know where you're living, but here in NJ, the MLS is the most tightly controlled guarded possession of the realtors. It's the listing of properties for sale in the area that is shared by the realtors and is extremely important to be in if you want to sell your house. You can't get your property into it without listing it with a realtor and that is the lock that they use to get their 6% commission, which is what most are still paying here. What this amounts to is price fixing, and anything the FTC can do to open this up will be a big plus. |
"What you're talking and about and what I'm talking about are two
completely unrelated issues. " Gee, no kidding? What do you think the original post about DOJ going after realtors over the MLS database was about. The listings is the only thing they have that anyone cares about. It's over the realtors trade practices of controlling their MLS, which restricts free trade and amounts to price fixing. "What you're describing is the case everywhere in the US, but in most places (including NJ, I believe) there are plenty of realtors who would list your property for a small fixed fee in the MLS" Show me one in NJ. No realtor here will do it for a small fixed fee. Foxtons will do it for 3% And that is the lock that DOJ is trying to crack. |
"That's what I was talking about! Unless you find the buyer who doesn't
have an agent or whose agent will accept a reduced commission, you WILL have to pay at least 3% to the buyer's agent. But you're not paying anything extra to get listed in the MLS. " What exactly are you referring too? You made the claim that in NJ you could get into the MLS for a small flat fee. 3% is a small flat fee? "Unless you find the buyer who doesn't have an agent or whose agent will accept a reduced commission, you WILL have to pay at least 3% to the buyer's agent. But you're not paying anything extra to get listed in the MLS. " Here in NJ the vast majority are paying another 3%, because they get into the MLS by going through a regular realtor. Yes, they get more than just the MLS for the extra 3%, but with the exception of Foxton's, which has a very small piece of the pie, that's how it's being done. "NO! It is not; you completely misunderstand what's going on! What they're going after are regulations that prevent outfits like Foxtons from operating!In the Realtors' ideal world you will not be allowed to pay anything less than the full commission (6% in most places). " Well, duh! I know perfectly well that the full service realtors are using the MLS and every other tool they can get their hands on to keep Foxton and similar outfits locked out of the market so the can continue to get 6% That is precisely what I was referring to, when I said the DOJ is trying to crack the lock. From your posts, I don't see what the current problem would even be, as you claim just about everyone can list a house on the MLS anywhere for a small flat fee. Yet, I've seen quite a few posts here from people in various areas of the country indicating, that like in NJ, that is not the case. |
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"One? How about eight HelpUSell franchisees? "
And where does it say anywhere that they get your property into the MLS? Isn't that what this thread is about? On their website their is no mention of MLS at all. Instead from their website: We guarantee in writing to advertise your property every week. We use our exclusive marketing system to get you buyers. We send an ad on your property to potential buyers now looking for property. We lend you "for Sale" and "Open House" signs. We list your home on the Internet at helpusell.com. Big deal, I'm still waiting for one place in NJ that gets you into the MLS for one low flat fee. |
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"Look, you obviously never sold a house so you should learn a few
things before you post on this topic! " I've sold more houses than you'll ever own. So now the story is, you get can in the MLS through realtors like Foxtons, it's free, but then you pay 3% when you sell your house. Big deal, like we don't already know that? That's exactly what I told you 3 posts back: "Show me one in NJ. No realtor here will do it for a small fixed fee. Foxtons will do it for 3% " Fine if you want to be technical about it, then it costs you 3% to USE the MLS. And in NJ it's damn well gonna be the 3%, because none of the realtors here that I've seen will take less than the 3%. In fact, you're lucky if they even are interested in showing a house listed on Foxtons, because they want to try to lock them out. Sounds like even you understand that. |
On 12 Sep 2005 09:25:33 -0700, "Larry Bud"
wrote: Andrew White wrote: wrote: "By the way, MLSs get most of their data from the public sources too. Whatever noises dumb realtors and appraisers make from time to time about ownership of the data, these go away fairly fast. The reason is that you can't copyright facts! " I don't know where you're living, but here in NJ, the MLS is the most tightly controlled guarded possession of the realtors. It's the listing of properties for sale in the area that is shared by the realtors and is extremely important to be in if you want to sell your house. You can't get your property into it without listing it with a realtor and that is the lock that they use to get their 6% commission, which is what most are still paying here. What you're talking and about and what I'm talking about are two completely unrelated issues. What you're describing is the case everywhere in the US, but in most places (including NJ, I believe) there are plenty of realtors who would list your property for a small fixed fee in the MLS. I paid $150 to have my house listed in the MLS. I had to pay 3% to the buyer's agent, of course, but I saved 3% of the seller's agent commission. Or one could start their own database, free of realtors, and charge nothing. A housing for sale database would be very simple to write. Of course, attracting viewers could be a bit more challenging. |
Andrew White wrote:
Once your house is in the MLS, your maximum exposure is going to be 3%. Of course, you can specify in your MLS listing that you will pay 2% or 1% or even 0% buyer's agent commission, but then no realtor will show your house to their client! 2% buyer's agent commissions are quite common, and there are plenty of agents that are quite happy with their 50% cut of the 1%. On a 1,000,000 house this is still $10,000. Some brokers forbid their agents from showing houses that don't have the "full" commission, the legality of which is questionable. |
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