Tuesday, October 11, 2011

Should you list on Realtor.com or the MLS?

Sellers know they need to reach as many buyers as possible. But what is the right way to do that? The most popular options are listing on Realtor.com - the massive national real estate website, or listing on their local MLS - But which to choose? The MLS and Realtor.com are similar but different; here is a short course on what they do, and who they are right for.

Realtor.com is best for sellers who absolutely only want to sell to buyers who are independent - those buyers who are not represented by an agent.

An MLS listing is best for sellers who are looking for any buyer, both independent as well as the 80% that are represented by an agent.

Here is why:

Realtor.com is a huge national website that primarily reaches individuals all across the country searching for homes. As the largest real estate website it reaches a very broad group of buyers. Most brokers do not search Realtor.com, instead they rely on their local MLS network to find homes for their clients. When you list on Realtor.com you are required to specify how much commission you are willing to pay a buyer’s agent. The standard is 3% but most FSBO minded sellers offer the minimum of 1% which guarantees that only individuals without agents will contact you. If you strike a deal with one of these buyers you will end up paying zero commission to agents.

No Commissions! I want that you say, but there is a catch: 4 out of 5 (or 80%) of all buyers are working with agents, so it well could be that the buyer who wants your home the most has an agent, do you really want to ignore them? Often it is much better to have more offers, or any offers and save 50% of the commission then have no offers at all.

This is where the MLS comes in. Agents look for homes for their clients exclusively on their local MLS. If your home does not show up on it you will not be seen by the majority of buyers. The bonus is when you list on the MLS you are automatically listed on Realtor.com also, so you still get access to all the independent buyers too.

The goal for most sellers is to get the best net offer, if that's one with a commission or one without it shouldn't matter, only how much money ultimately ends up in your pocket. If you're willing to offer up to 3% commission to attract buyers with brokers and expand your possible number of offers, then the MLS is the right choice.