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How does a non-MLS broker function? I realize that the advantage of being associated with a non-MLS broker is greatly reduced costs. How does such an office function? Are these licensees looking up properties on the Internet like a buyer without full MLS access?
I am not a real estate licensee. But it seems to me that the various MLSs around the country have in a sense taken over the brokerage industry.
MLS's were established as a means for offering compensation to cooperating member brokers that sell another broker's listing. If a broker is not a member of an MLS, then they must establish a compensation agreement directly with any broker where they may want to sell that broker's listing, or only focus on selling their own listings.
I don't understand your other comment about MLS's taking over the industry. They are established by brokers to facilitate sharing listings with a commission co-broke fee.
The MLS is a pittance of my business costs per year. If I wasn't a member of the MLS it would hardly make a dent in my monthly expenses. It is $75 a month. Agents pay their own MLS fee.
MLS's haven't taken over the brokerages. They are a business tool. That's like saying cell phones took over the brokerages.
How does a non-MLS broker function? I realize that the advantage of being associated with a non-MLS broker is greatly reduced costs. How does such an office function? Are these licensees looking up properties on the Internet like a buyer without full MLS access?
I am not a real estate licensee. But it seems to me that the various MLSs around the country have in a sense taken over the brokerage industry.
Thank you in advance!
A non-MLS broker functions exactly like an MLS broker except that they do not have the cooperative agreement and shared network services in place that the MLS system provides.
In order for a non-MLS broker/agent to show a listing from another brokerage, they must negotiate permission and fees with the listing broker. This is what is pre-agreed within the MLS system.
A non-MLS broker/agent can use the same tools available to you to find other listed properties. They cannot legally utilize the MLS database, but anything posted to the public is available to them as well as the option to create their own database of listings through personal networking, neighborhood canvassing, etc. It will not be able to include all of the data and features of the MLS database, but it can provide an advantage over other non-MLS offices without such an in-house tool.
As to the takeover by MLS, I guess that is a perception that could be held by someone unfamiliar with the industry. Just like libraries have taken over the written word. When a system is successful everybody wants onboard. I don't think MLS strategically infiltrated and made real estate agents join their systems any more thab libraries made a conscious effort to force people to store their books collectively in a public building for the common enjoyment of the community. I think both were simply great systems that made the functionality much more convenient to use.
Interesting responses in this thread. In my listing contract, it lists a percentage for cooperating compensation but does not differentiate between MLS and non-MLS agents. It just says "buyer agent." In fact, the only place MLS is mentioned in the contract is under marketing responsabilities. So, any real estate agent would be entitled to a commission if they brought a buyer to my listings. I'm pretty sure most listing contracts in this area are written the same way.
Mike.. Part of belonging to our MLS is the agreement to share a fee advertised in the system. If someone is not a member, technically they would need to sign an agreement with a listing agent to pay a commission every time they made an offer.
If you are not part of our MLS, we have no obligation or agreement to pay you or share in the money earned. We can pay you because you're licensed but no agreement exists to do so.
Texas is a non-disclosure state, which means no one has to reveal the purchase price of real estate they buy. MLS agreements typically mean an agreement to disclose the sales price into the MLS system, however this is not necessarily the case for commercial real estate. In major metro areas, most commercial property sold does not make it into the MLS system. Many brokers specializing in commercial real estate are "non-MLS brokers" since they have no interest in selling houses.
Am I wrong in assuming that the vast majority of licensees are MLS member?
So in most states, does a non-MLS broker have to enter into a compensation agreement anytime he/she shows another broker's listing?
Other than saving money -- which I gather is not a lot --why would one selling residential property forego being an MLS member?
As far as costs go, don't you have to be a member of the NAR and the state & local chapters to belong to the MLS? If so, are the dues to these groups high?
...As far as costs go, don't you have to be a member of the NAR and the state & local chapters to belong to the MLS? If so, are the dues to these groups high?
There are MLS associations that do not require NAR membership.
Mike many listing contracts just say x% and don't break it out as listing side or buyer side. The listing agent decides what they will give the buyer agent.
Tn Lily,
yes most agents are members of the MLS as it streamlines the process of buying and selling homes. In all states, a non-MLS member would have to legally secure a payment agreement before showing a listing from either their client or the listing agent. This is why we have the MLS...to avoid this complete waste of time.
People forgo the MLS because they don't want to be a REALTOR typically. 82% of MLS's in the country are run by REALTOR boards so they require membership. The rest are independent and don't require REALTOR membership. My MLS is one that doesn't require it, but the other 5 in my state do. In my city, it is about $700 a year to be a REALTOR. Dues will vary across the country because when you become a REALTOR you pay NAR dues which are the same for everyone, your state organization dues, and local association dues. Those are the ones that vary. It is the local association that often runs the MLS.
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