What is a multiple listing service (MLS)?

A multiple listing service (MLS) is a powerful tool used by real estate agents to share accurate, current information about homes for sale and properties that have recently sold. The information in an MLS can be used to help buyers and sellers meet their goals. The MLS is not just one database, however. It’s a collection of hundreds of regional databases that agents can access.

We’ll walk through how an MLS works, what information it includes, and the benefits and limitations of using it.

Multiple listing service (MLS) definition

MLSs are created and maintained by cooperating real estate professionals to share information about properties on the market. This data usually includes details such as the listing price, the number of bedrooms, the number of bathrooms, the square footage, and other relevant data points for potential buyers.

Often referred to as ‘the MLS,’ it’s a network of local databases across the country, not a single entity. In fact, there are currently more than 500 multiple listing services nationwide, according to the National Association of REALTORS^® (NAR). That number fluctuates as neighboring databases come together to form larger, regional ones.

Brief history of MLSs

It might seem like an MLS is something derived from technological advancements, but the concept has been around since the 19th century, according to NAR.

In the late 1800s, real estate brokers would get together to trade information about properties they hoped to sell, agreeing to compensate the buyer’s agent through brokerages when a sale was successful.

As technology advanced, so did the MLS, evolving from physical catalogs to today’s online version. And the MLS continues to mature, with the NAR making recent changes to help further streamline and secure the databases.

How does an MLS work?

Real estate agents pay a fee to add their listings to their region’s MLS or to access its information. This fee can be hundreds of dollars per year. This way, other agents can easily find properties for their buyers.

Most homes are listed in the region’s MLS, but not all. There are some properties that sellers do not want to publicize for various reasons. For instance, homes sold by the owner without a real estate agent are usually not listed on the MLS. There are also off-market, quiet, or pocket listings, which are homes that the seller does not want to market publicly.

What does an MLS listing contain?

An MLS listing includes the most up-to-date and accurate information about a property for sale, or that has recently sold, in each area. It gives buyers and sellers, through their agents, a complete picture of a property.

Here’s what you’ll typically find in an MLS listing:

• Listing details: Key information like the number of days the house has been on market, the listing agent and brokerage, and whether the home is active, pending, contingent, or sold.
• Financials: Pricing information, including the current list price, past sale prices, property taxes, and any HOA fees.
• Property location: The full address, subdivision, or neighborhood.
• Structure and exterior: Essential details such as the year the home was built, its square footage, number of stories, construction materials, and any unique features.
• Interior features: Information on the type of home it is, the number of bedrooms and bathrooms, the flooring, HVAC systems, and descriptions of major rooms and layouts.
• Visuals: Photos, videos, and virtual tours that help buyers get a feel of the home before visiting.
• Disclosures and notes: Important details about known defects, HOA rules, or conditions that could affect the property or transaction.

How to access an MLS

Because the MLS is a product of, and paid for by, real estate agents, they are the only ones who can access it. So, if you’re a buyer, you’ll need to work with a real estate agent to gain access to the MLS. Your real estate agent might be able to give you temporary access to the MLS, depending on the specific rules of that region’s database. If not, your real estate agent can share the information in the listings with you.

You can also research properties through Redfin, which lists properties and specifics about them. This is not affiliated with the MLS and is not necessarily the same information. However, it is open to the public.

What are the benefits of an MLS?

The MLS is mutually beneficial to buyers, sellers, and their real estate agents. It makes getting accurate, up-to-date information easy for everyone involved and therefore expedites negotiations. Here’s how it benefits each party:

Buyers: They can see most properties for sale in their region and get details that commercial real estate websites often don’t show.

Sellers: Having their properties listed on an MLS increases awareness and the pool of possible buyers. It can help them get the most money possible for their homes and speed up the sale.

Real estate agents: An MLS can save them time, help them better serve buyers and sellers, ensure fair competition, and maximize exposure for their listings. It can also assist them in doing a comparative market analysis for their clients.

What are the drawbacks of an MLS?

There’s no doubt that the MLS is a powerful tool for agents, buyers, and sellers. However, there are some drawbacks to the MLS.

For instance, buyers and sellers without a real estate agent have no access to the MLS. Also, because it is maintained by agents, there can be inaccuracies and delays in updates to the data. As mentioned previously, some listings, such as homes sold by the owner, pocket listings, or shadow inventory, will not be included in the MLS. And there is a cost to agents to participate and competition among agents for listings.

FAQ

Here are quick answers to common questions about the MLS.

What is an MLS number?

An MLS number is a unique identifier assigned to a property when listed in the MLS. It helps agents find a specific property quickly and efficiently.

Do buyers or sellers pay any costs related to the MLS?

Not directly. Real estate agents pay a fee for access to the MLS and to list their clients’ properties on it. In some cases, however, this could be part of a real estate agent’s fees.

How often is MLS data updated?

The MLS is updated frequently, often multiple times per day. Since it’s maintained by agents, there are sometimes delays in data being entered.

What are alternatives to using an MLS?

Finding homes for sale doesn’t have to include the MLS. Alternatives to the MLS include for-sale-by-owner (FSBO) listings, real estate websites, social media marketplaces, and online sites like Zillow.

Can a seller choose what is shared on the MLS?

Sellers can control some details in their MLS listing, such as photos, descriptions, and whether to disclose specific features. But certain things are required, such as at least one photo, the status of any sale, the square footage, and certain other vital information important to buyers.

The bottom line: The MLS is a critical tool in your home search

The MLS provides accurate, up-to-date information on properties for sale and helps buyers, sellers, and agents connect and make deals more efficiently. Access is limited to real estate agents, which is why working with a real estate agent is so valuable. They can share MLS information, as well as find properties not listed on the MLS, and guide you through each step of the homebuying or selling process.

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