Multiple Listing Service (MLS): Definition, Benefits, and Fees

What Is a Multiple Listing Service (MLS)?

A multiple listing service (MLS) is a database established by real estate agents to share details about properties for sale in a particular region. An MLS can help agents see one another’s listings and connect buyers looking for properties on the market. A local MLS can also provide prospective homebuyers with detailed information on each property for sale, including features, square footage, and listing price.

How a Multiple Listing Service (MLS) Works

Multiple listing services, or MLS for short, create a book or an electronic database with all of the houses for sale by affiliated brokers, who update it on a regular basis. Typically, real estate brokers work together locally to help create each regional MLS. As a result, hundreds of regional databases exist containing all of the national listings found on various real estate agent websites.

How To Access My Local MLS

An MLS can only be accessed by licensed real estate agents and brokers. If you're looking to buy or sell a home, you must partner with a real estate agent to access the MLS in your region. Once you partner with an agent, you'll likely gain access to the listing on the agent's website.

Real estate agents and brokers pay dues or a membership fee to access each MLS. In return, the agents receive detailed information on the homes, including photos, square footage, and features of each property. Although each MLS may have its own procedures, they may follow the rules established by the National Association of Realtors (NAR).

MLS Listing Details

An MLS listing typically contains information about the selling price, structure, features, and location. When shopping for a home, MLS information to look for includes the number of days the house has been on the market, which can indicate housing demand in the area. Also, the type of sale can influence the listing price, such as whether the sale is a foreclosure or a short sale from a distressed seller.

The table below shows details that an MLS listing might contain:

History of the MLS

The multiple listing service was created in the 1800s to foster better cooperation among real estate agents when they realized each brokerage could sell their houses more effectively and serve their clients better by going outside their own brokerages’ listings.

The MLS is essentially an agreement among real estate agents to list each other’s properties through a cooperative service. The first multiple listing services were circulated via catalogs, but almost all are online today. The concept of an MLS is generic, with no governing MLS body, and the phrase cannot be trademarked or branded.

Why Multiple Listing Services Are Needed

In the digital age, buyers can browse through countless real estate and brokerage websites. Despite this increased exposure, the need for an MLS persists. If a buyer works with a broker who belongs to an MLS, the broker can quickly and conveniently search all of the properties for sale by participating agents.

In most cases, the MLS listing also contains private contact information and details about showing times. Without this consolidating service, the broker would need to look through several websites for individual brokers to find available properties in the area.

Benefits of Multiple Listing Services

Multiple listing services provide more exposure to the selling broker and more options to the broker representing the buyer. In return, both brokers receive a commission on the sale. These services also level the playing field by allowing small and large brokerages to compete with one another.

For example, imagine if a small brokerage could only offer its buyers the properties the firm had listed. The firm’s buyers wouldn’t have access to all the listings from other brokers in the area. However, with an MLS, the information is consolidated rather than fragmented. An MLS allows competing brokers to work together toward a common goal of helping buyers find their desired properties and helping sellers sell their properties.

As a result of the cooperation of the agents and brokers to create the MLS databases, prospective homebuyers gain access to numerous listings. At the same time, sellers get connected to buyers through their broker or agent. Even online real estate websites containing national listings—such as Zillow, Redfin, and Trulia—pull data from the regional MLS databases.

The Bottom Line

The multiple listing service (MLS) exists to make it easier to find properties for sale and for you to sell your property. With real estate websites like Zillow, Trulia, and Redfin, searching through the MLS can appear tedious. However, an MLS contains accurate and up-to-date information on homes for sale in most areas.