TO MLS OR NOT TO MLS

There is a little controversy right now about the concept of a ‘Pocket Listing.’  There have been a number of recent news and opinion pieces, mostly from Realtor groups, condemning the practice of keeping a salable listing out of MLS. (Multiple Listing Service)   Before I tell you what I think, let’s examine the Realtor point-of-view.

Since the advent of the MLS, the residential real estate business has operated on a cooperative basis.  Because most MLSs require that every home listed by a member broker be offered for sale through the MLS (unless the sellers signs an op-out waiver), every Realtor has an opportunity to sell any property listed with a competitor and earn a portion of the commission.

This is marketed as being in the best interest of the seller because it maximizes the opportunities for exposure of the home, getting it in front of more and more potential buyers through their individual agents. And after all, whether another Realtor comes in with the buyer or the listing agent finds the buyer him or herself, the cost to the seller will be the same; it won’t cost any more.

And that’s where the problem lies.

In general, when a seller lists with an ordinary broker, s/he agrees to pay a percentage based commission.  The actual percent varies, but will often be in the 5% – 7% range.  Consider something right in the middle, say, 6% on a $500,000 home. That’s a $30,000 commission!  Huge, right!?  But one of the reasons it is so high is the listing office has to be prepared for the likely event that an outside broker and agent will bring the buyer – and they’ll have to be paid half of that commission.  Of course, if there is no outside broker, if the listing brokers finds the buyer his or herself, the seller still pays $30,000 because . . . well because that’s just the way it’s done!

At Help-U-Sell Bay Beach Realty, we don’t charge a percentage based commission, we charge a Low Set Fee.  AND we unbundle commissions.  If there is no outside broker involved, you don’t pay one.  Now that’s a real benefit to a seller, one you can put a dollar sign on!

There are situations – locations and marketplaces – where we recommend most sellers go into the MLS.  These are the situations where we need all the exposure we can get.  But in a good location, with a properly priced house, sometimes it makes sense to stay out of the MLS – especially if that means saving the seller a lot of money.

Right now, in various locations around Central Jersey homes are selling in 60 days or less and sellers are getting 99% of their Listing Price in a Sale.  Clearly demand is high.  In a market like this it might make sense to market the home for a time – say, 30 – 45 days without the MLS, without offering it for sale through outside brokers.  If a buyer can be found without the MLS, the seller of the $500,000 home mentioned above would a TON!

At Help-U-Sell Bay Beach Realty, we are about two things:

• Getting your house sold for top dollar
• Saving you the most money in commission expense

We will consult with your at the time of listing and continuously thereafter about how best to market the home, whether the MLS makes sense or not, and how to maximize your savings while selling for the greatest possible price.