Want to get top dollar for your seller? Stick with the MLS
Two regional studies of home sales found that properties listed on the MLS sold for significantly more than homes sold off-MLS.
- Homes listed through Bright MLS and Northern Nevada Regional MLS sold for over $50K more than homes not listed through their respective MLSs.
- Bright MLS has seen the percentage of homes listed on its MLS increase since 2019, reaching 89% earlier this year.
- On a national level, pocket listings trended up during the pandemic but now appear to be on the decline.
For sellers who think they'll fetch a higher price for their home by forgoing a traditional listing, the data says otherwise.
Two recent studies found that not only are more sellers listing their homes on Multiple Listing Services, they are also getting better offers when they do so, particularly in the post-pandemic real estate market.
Bright MLS, which serves more than 100,000 subscribers and covers much of the mid-Atlantic region, found that homes listed through Bright sold for 18% more than homes not marketed through the MLS in 2022. That boost equates to $53,890 on average, according to the report, which looked at one million home sales and was done in collaboration with senior research fellow Kevin Gillen at Drexel University.
On the other side of the country, a similar study from the Northern Nevada Regional MLS released earlier this year found a nearly identical price bump. Homes listed on NNRMLS between 2015-2022 sold for 17% more than homes sold off-MLS, equating to a $55,250 increase in the average sales price.
Both studies also reported high levels of participation in the MLS. The Northern Nevada study found 86% of for-sale listings were on the MLS in the study period. Bright found that participation levels increased during the pandemic, rising from 81% in 2019 to 85.5% in 2022. During the first quarter of 2023, more than 89% of all listings in its coverage area were on the MLS.
Lisa Sturtevant, chief economist for Bright MLS, noted that MLS participation increased during a seller's market — perhaps surprising, since sellers might be more willing to try and sell a home on their own given high buyer demand.
During the height of the pandemic, sellers were eager to get the best price for their home, but they may not have wanted the responsibility of showing the homes themselves or meeting with prospective buyers, Sturtevant said. That preference appears to have continued even as the pandemic has waned.
"The research demonstrates that even when we are in a market where the seller has the upper hand, the MLS creates a more competitive and efficient market for housing, resulting in better offers and quicker transactions," Sturtevant said.
Is there a place for pocket listings?
Pocket listings and office exclusives, where an agent shares a listing through a private network or only within their brokerage, still account for thousands of home sales. The practice was rising in popularity at the peak of the pandemic, according to a September 2021 New York Times article, which noted the attraction for sellers who wanted to avoid throngs of buyers going through their house.
And for luxury sellers with privacy concerns, pocket listings may be a preferred option.
But for the typical seller, bypassing the MLS can limit the number of potential offers and provides no apparent financial benefit — and can also run afoul of fair housing regulations. That's something MLSs like Bright have been educating consumers about.
Pocket listings appeared to be trending downward nationally, according to Redfin research. In January 2023, Redfin estimated all off-MLS sales were at 14.3%, down from 18.4% at the beginning of 2022 and 21.4% in the third quarter of 2021.