What is the MLS?
Investing in real estate is one of the biggest moves a person can make in their lifetime. It involves a ton of risk and a ton of money.
But thanks to the invention of the MLS, real estate transactions are smoother, and people are more informed. That means more accurate transactions where people aren’t paying too much for property they want.
The MLS is a powerful tool that both real estate professionals and consumers use in real estate transactions across the country. Without the MLS, it’d be pretty hard to determine whether a property would be a good investment.
If you’ve never been involved in a real estate transaction as a buyer, seller, or investor before now, you might wonder, what exactly is the MLS and what is it used for in real estate?
What is the MLS: A Short History
So what is the MLS? Let’s take a look.
The multiple listing service (MLS) was developed to help make real estate transactions more practical for real estate brokers. According to The National Association of Realtors, the MLS is a private offer of cooperation and compensation.
The first MLS was developed in the late 1800s when brokers would meet and share information about properties they were trying to sell. Brokers were compensated for helping another broker sell a property; thus, the first MLS was created.
Now, there are over 800 MLSs where brokers can quickly and easily share information that helps them sell property faster. Since the real estate market is so competitive – but also unique because competitors have to cooperate – the MLS helps make it easier for both parties involved to cooperate.
The MLS can help keep things fair so that no one brokerage or agent can monopolize the real estate market. It’s a fair market in the real estate game, which means equal opportunity for everyone.
That means buyers and sellers can be confident that their agents (and their opponents) are playing fairly. It also means the smallest brokerage in town stands a fighting chance against the whale of a real estate brokerage (i.e., multi-state firms).
Essentially, it’s an electronic, regional database established by real estate brokers that provides information about properties for sale. It allows brokers to see each other’s properties to facilitate the buying and selling of real estate.
What is the MLS Used For?
The MLS provides detailed information about properties in specific regions throughout a particular geographic area which includes:
- Square footage (and price per square foot)
- Property type
- Type of property (i.e., single-family home, multi-family, etc.)
- Number of bedrooms
- Number of bathrooms
- Property History
You’ll also get information about how long the property has been on the market when it was listed, and the buying and selling history of the property over the last few years. You can get even more detailed information from the property tax records. Gathering all this information about a property can help you determine whether a property might be a good fit for you investment-wise.
What Fees Are Associated with the MLS?
Most people don’t know that access to the MLS isn’t free. There are hefty fees for real estate professionals to gain and maintain access to the service. Hundreds of MLS organizations around the country charge different prices to real estate brokers who belong to that MLS network. Your broker may pass those fees on to you.
What is an MLS Number?
An MLS number is a serial number for each property that’s on the market.
An NMLS number, which is different from an MLS number, is also a number you might notice in a real estate transaction. This number is issued by the Nationwide Multistate Licensing System and is permanently assigned to anyone working as a mortgage loan officer.
What are the Advantages of the Multiple Listing Service in the United States?
So, what are the advantages of the MLS in the United States?
Well, one benefit is: Some regional MLS databases have a “public-facing side” so that consumers can access the duplicate listings. But in other areas, only licensed agents can access the MLS.
The MLS is also highly beneficial because you can get detailed property information before making an appointment to see it. That way, you can decide if it’s worth taking the time to see it in person.
With advanced tools like ProspectNow, you can gain access to property information from across the country.
Alternatives to the MLS
As we discussed earlier, some people choose not to work with a real estate agent and go on and buy or sell homes themselves. People use alternative sites and services in areas where the MLS isn’t available public to the general.
For example, some people use FSBO (For Sale By Owner) – a website on which you can list your home for sale or find homes for sale by the owner instead of a real estate agent.
There are also some areas, such as Seattle and New York – where the MLS isn’t the only way to list your home with an agent.
For example, some large real estate brokerages use their proprietary databases to list homes instead of listing them on the MLS.
So if you’re looking to invest in either of these markets, you should be aware that you’ll have to contact those brokerages that operate that way directly to learn about a lot of the existing properties in those areas and check the MLS.
Taking it One Step Further
Now that consumers and investors like you can access what is essentially the MLS without the need for a real estate agent, you have the power to acquire information about property that every broker in your area has.
If you want to be as thorough as possible in your real estate investing, take things a step further and invest in real estate analytic software. This will help you figure out which deals are worth your time versus which ones you should probably pass on.
But with even more advanced technology like ProspectNow’s software, you’ll have access to even more data than ever.
You’ll have more than just access to property information. You’ll be able to look at detailed ownership, sales, listing, and loan origination data for every property in the entire country – not just your region.
Do you want to invest out of state? ProspectNow makes it easier than ever by unlocking insights that can help you make valuable connections.
You’ll get information like:
- Property info
- Tenant info
- Transaction info
- Lien info
- MLS info
- Foreclosure info
On top of that, imagine having your own personal research assistant who can analyze transactions 24/7 and collect tons of valuable data. Not to mention, it’ll show you which properties are the most likely to sell or refinance in the next 12 months. You can’t beat that.
It can benefit multiple professionals involved in a real estate transaction, including:
- Brokerages- Helps develop relationships with likely sellers up to 12 months in advance.
- Financial institutions– Helps originate more loans and grow commercial relationships faster.
- Property service providers– Finds the information you need to reach property decision-makers at the right time.
- Tax and insurance professionals– Finds owners of multiple properties for cost segregation and properties with upcoming policy renewals.
As you can see all real estate professionals can benefit from using the MLS. In conjunction with a tool like ProspectNow, it helps maximize their results and, in turn, make more money.
It also gives you access to commercial property information in case you are more interested in investing in commercial versus residential real estate.
Using the MLS and ProspectNow
Sifting through bulk data and trying to make sense of it is the old way of doing things. Embrace technology, and you’ll make your life a lot easier – and your headaches fewer and far between.
ProspectNow has been around for over a decade (since 2008). The data that users can get from ProspectNow is much more expensive than other competing platforms. By using ProspectNow, users will close more deals and make more money! ProspectNow is trustworthy and easy to do business with, not to mention a reliable data provider. Start your free trial today!