Why is there no nationwide MLS system?

Real estate professionals utilize a system called MLS (Multiple Listing Service) to find information about homes, including homes that have been sold, are currently for sale, were for sale but canceled or expired, are for rent or been rented, etc.  The data in the MLS is quite extensive, and is critical to the completion of a real estate agent’s job.

However, the MLS system(s) are very regionally based, and there may be more than a thousand different systems nationwide which are structured differently, contain different data, and are only accessible by purchasing access for one particular region.

I’m sure there’s a logical reason for not having one nationwide MLS , but it appears to me that having a nationwide system would be much more logical than having all the thousands of regional MLS systems.  Follow my thought process:

Benefits of a nationwide system:   

thumbs upOne overall set of rules, nationwide:  This would be true for administrative issues, listing entry issues, rules on how to calculate square footage, etc.  If a client is relocating into your area from another, they’ll understand perfectly what it means when you say a home is 2000 square feet; the client will know that doesn’t include garages, finished basements and decks (or alternatively, they’ll know it DOES include those things) because everyone nationwide uses the same rules to list a home.

  • Better tool to answer questions for clients; a client is wondering what kind of property taxes are charged for a 3 bedroom 2500 square foot home in a different area, or what the price ranges in a nearby county are.  Currently, we have to find someone in the area to answer those questions, which can be time consuming and if we don’t get the right person, the data could be incorrect or unclear.  Isn’t it better customer service to be able to provide this kind of information immediately?

Easier for agents who are moving to a new area to transition. Agents who are moving their business to a new location would be able to research the new area without having to get a sponsoring real estate branch in the new area to sponsor their access, pay another fee, take new training classes and learn a different system.  One system would assist agents in not having any down time.

 

Challenges to a nationwide system:

I can’t think of any “real” problems with having a nationwide MLS system, although there must be some.  I came up with the following potential issues, but then I discarded them for the reasons listed:

  • thumbs downTechnology:  At first I thought perhaps there was a technological impediment to having one MLS system, but I quickly discarded this notion.  The Internet is worldwide, providing the ability to access data everywhere.  There are plenty of nationwide systems accessed by multiple people, businesses, and organizations.  There cannot be any technical reason a national MLS wouldn’t work.
  • Turf:  Perhaps there is a feeling that if agents from another county or state had access to MLS data, they would take care of customers in an area that is serviced by other agents.    However, agents who want to provide quality service to their clients wouldn’t do this – there would be no way to appropriately service a client in another state.  In fact, currently, I have access to data in multiple counties, but I would not personally sell a home in the further counties.  I just couldn’t provide quality assistance to my clients, and I would refer those sales.  Opening up the MLS to all states, wouldn’t change this in my opinion.  So I don’t see this as an issue either.
  • Regional MLS Oversight:  Could the problem be that all the local regional boards would lose some of their power and fundraising ability?  Perhaps there are regional issues that a nationwide MLS board wouldn’t address?  As with any big corporation that operates nationally, there is still a need for regional oversight.  So I would think functionally, the same services could be provided for each separate region that are provided today, even with one overall system.
  • Funding?  Does it all come down to money?  I don’t really have the answer for this, but I would think if a nationwide system was required, funding to design and build it would be found somehow.  Could this be the problem?

 

Comments?  I must be missing something, because it seems as though a Nationwide MLS system is something that should have been implemented years ago.

I would love your feedback.

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4 thoughts on “Why is there no nationwide MLS system?

  1. I’ve been asking myself the same question, Why is there no national MLS system? I’m not a broker or agent. I’m a software engineer so maybe you can answer a couple of questions for me.

    1. From a legal standpoint, are brokers and agent free to join whatever property listing service they’d like or are they confined only to MLS systems?

    2. As a broker or agent, what would it take for you to move your listings to a new national MLS like system?

    I ask these questions because I’m debating whether I should take on the enormous project of creating a national MLS like system.

    • John,
      Good morning!

      1. Brokers and agents can join whatever listing service they pay for, although typically it’s just the one that serves the area they live in. They would need to pay the annual fee, then usually take some sort of training, before they are able to use the new system. In terms of whether they are “confined” to MLS systems, I’m not sure what other systems you’re referring to. Systems like homes.com, trulia, etc? If yes, then, no, agents are not restricted and can join those systems as well.

      2. I would think if a nationwide system were implemented, it would have to include a relatively seamless transition of existing listing. Perhaps the new system (which would require nationwide agreement from MLS boards on the rules that would be associated with the new system) could be put in place, and one county or state at a time moved over. Each listing would need to be transitioned, i.e., sqft in one system equals the same as square feet in the new system, or prices listed in thousands in one system would need to be automatically converted to whole dollars in another. Then each agent or company would probably have to confirm their listings were still accurate before the actual cutover. I’m sure it would be a HUGE job, but well worth it in the end.

      Keep me posted on your thought process!

  2. Kat,

    I documented some of my thoughts about creating a national MLS system and would like your feed back if possible. Where can I email it to you?

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