The "Multiple Listing Service" (MLS)

The Multiple Listing Service, or MLS, is a database, or directory of homes that are listed for sale by real estate brokers or agents. When a home is listed for sale in the MLS, the listing provides the maximum exposure to real estate brokers and agents that may have clients as potential homebuyers. Specific property types and detailed information in the database can be quickly located and matched to the criteria of potential buyers. 

Because this directory is so comprehensive, it has become the most powerful marketing tool in the real estate industry. In many areas, up to 85% of homebuyers first learned about the home they bought, through a listing in the MLS. More homes are sold through the multiple listing service than by any other medium.

Prior to the Internet, access to the MLS database of home listings was available only to licensed members, and as a result had limited the alternatives that were available to the traditional listing and sales approach. Now, with the advent of easy access to this powerful database, consumers can choose money saving alternatives to the traditional sales commission.

Alternative Real Estate

As a result of the change in real estate technology, there are a growing number of real estate brokers who are offering services at substantially reduced commission rates. The innovation of alternative real estate services, combined with easy access to Internet listings and research information, offers consumers the benefit of money saving options to choose from.

Another option that is becoming popular is a fee-for-service brokerage, which provides the unbundling of services for each separate option as needed by the consumer. For example, when a broker is paid to perform specific services such as, negotiate purchase offers, but not all the other aspects of a full service broker. The advantage for the consumer is the ability to choose which services are needed for a particular transaction. The unbundling of specific services can provide lower overall costs, however, the individual services would have to be compared to other service options to determine the best value. While saving money is usually the primary goal, consumers should of course also compare the level of service when choosing a real estate broker.

Although real estate commissions are negotiable, and are not fixed by law, the industry has maintained a commission level of around 6% for a traditional full service listing, but the trend for reduced sales commissions is picking up speed as more consumers become aware of the options, and as more real estate brokers adjust to the change in business.

Home Buyer Rebate

For homebuyers, many brokers and agents are now offering home buyer rebates up to 1% of the final sales price, which can be paid, or credited to the costs of the homebuyer at the close of escrow. Again, when compared to a traditional full service sales commission paid to a selling agent, the savings to the homebuyer can be high.

The following is an example shows the potential savings from a home buyer rebate compared to the traditional 3% selling agents commission:

· $400,000 Sales Price
· 3% Traditional Commission to the Selling Agent = $12,000
· 1% to the Home Buyer = $4,000

In a typical home buying transaction, the selling broker would receive a 3% commission for their service, and would rebate the agreed portion of the commission to the buyer when escrow closes. The rebate can be applied to the buyers down payment or closing costs, or taken as cash, providing there are no lender or state restrictions, or the amount of the buyers rebate can be deducted from the final sales price of the home.
 

"When we first decided to use Buyer Rebates Realty. . . I remember being a little concerned that we would get something less than full service... instead, we were pleasantly surprised to find out just the opposite. My wife and I have now purchased 3 homes & I am happy to say that we have never worked with a more professional, attentive, full-service Realtor."   ~ Stephen F. Hamilton	"We flew in from California and did not know the area at all, but Buyer Rebates Realty did a super job after orienting us and showing us numerous communities. When you combine their level of professionalism & area knowledge with the cash rebates, I can't imagine using any other Realtor." ~ Mike & Kelley Haak