When considering selling your home by owner, that is selling without using a realtor, selling by owner, selling FSBO, or just simply selling For Sale By Owner, there are many options for listing the home on a Multiple Listing Service (MLS) for a flat fee. For those that don’t know a Multiple Listing Service is a Realtor only organization that was created for realtors to share their listings with other realtors. As was the old model an MLS will get a seller great exposure because theoretically every realtor member of the MLS is alerted to a new home being listed for sale. Over the years however companies like Zillow became realtors as well, joined the MLS and post all the homes for sale on the MLS on Zillow. Zillow is not the only company. Others like Redfin, Trulia, Moto, Homes.com, Realtor.com, and many others do the same thing. These websites get a lot more traffic than an agents website or the local MLS website, by the millions. And that makes sense. Zillow and these other companies offer all the MLS’s, a very easy to use platform, and spend a ton of money getting traffic to their website. All of this is financed by realtors paying Zillow and these companies for the leads they generate. Zillow generated $1.9 billion in revenue. Just Zillow!
If all of the buyers are searching for homes on these websites, why do you need an MLS? You don’t. Also by listing on the MLS you are actually negotiating against yourself.
I will get back to how being on the MLS will hurt you but first, I must address that on many websites such as Zillow, homes being sold by owner, are under a different tab than those listed by realtors in order to comply with the variety of MLS rules and regulations that make it impossible for a home being sold by a realtor to list homes being sold without an agent side by side. A buyer user has to go to the filter section and press a tab to display the homes being sold by owner. However almost all users of these websites use the filter function to narrow down their search by limiting the price, type of property, ie condo, single family home, and the number of bedrooms and bathrooms. It is in the same box. It is also important to note that some websites like Realtor.com will not display any homes being sold by owner, because they are a realtor only site. Nonetheless, the numbers speak for themselves.
Zillow which also owns Trulia received combined 60 Million visitors as of a report in Feb of 2023. The next closest site is Realtor.com with 21 million. With that difference, and that most buyers use more than one platform to find a home for sale, there is no need for the MLS to get exposure.
So how does being on an MLS actually hurt you?
Being on the MLS has many disadvantages. The first begins with whose information appears in the listing? If listed on the MLS it can only be the listing agent. That’s right, the company’s that offer a flat fee for an MLS are actually blurring the lines a little because one has to be a realtor to be a member of the MLS. Further when the home is broadcast from the MLS to Realtor.com Zillow.com and many other websites it is the listing agents information that will appear. So whom will get the phone calls you or the listing agent you paid a fee to? The listing agent. It is against the rules of the MLS as well as websites like Zillow and Realtor.com to put a phone number in the description of the home. Why? Because they sell leads to agents and they don’t want to display the contact information of the seller directly. Further if one is sharing their listing with all the other realtors in the area, it is unfair to display a way to circumvent that realtor. So what incentive does that listing agent have to pass that buyers info to the owner? I am not saying they wont I am just saying that buyer is now a lead for that agent to sell a home to and that is what they will do. Further if you are offering the selling agent commission then you just missed out on an opportunity to sell your home and not pay any commission at all, which is the ideal for any homeowner selling without an agent, or selling For sale by owner.
Further if you are offering commission and listing on the MLS, to comply with local MLS regulations the amount must be stated in the listing. That’s right it appears in the listing on all the websites. You can often find it in the features section. Therefore if a buyer comes across your listing, on Zillow Realtor.com or other sites, one that was posted on an MLS, they will see you are offering commission. When negotiating, if they do not have a realtor, they can just deduct the amount of the commission from their offer right? That is called negotiating against yourself. Don’t do it, you will always end up getting less money for your home. And if you decide to not offer any commission on the MLS, no one will show your home. These websites will only provide the listing agents info. Why would they pass along this buyer and not try to sell them a home that pays commission? Also these companies sell leads based on your listing (Go to any listing on a website like Zillow.com Realtor.com Homes.com Trulia.com and when you press the button to get see the home or talk to someone, you are directed to a realtor whom pays for this.). Why would that realtor say praise worthy things about a listing that offers no commission compared to one that does? They wont if they want to stay in business. I am not saying you wont get any buyers passed to you. They will, they just wont be the best buyers, those they will take.
When listing your home for sale by owner on Zillow you do not need to state if you are paying commission or not. Your information is in the listing. Don’t pay to be on the MLS, it is not needed. Sell your home yourself and save thousands of dollars.
