Flat fee MLS listing is now the fastest growing segment of real estate today
It all started in 1993 when a few rouge brokers started offering MLS direct services to the public also known as flat fee MLS listings. While the general public embraced the innovative cost saving approach to selling real estate, the powerful old school real estate monopoly held by the national real estate companies and the MLS systems itself rejected the idea and fought back to squash the competition from these fledgling flat fee MLS listing brokers.
Things didn't go well for these early flat fee MLS listing pioneers as the new discounters were quickly meet with fierce resistance from state politicians supported by lobbyist paid by supporters of traditional 6% commissions.
It wasn't long before the Department of Justice stepped in and sued the NAR (National Association of Realtors) and the State of Texas over monopolistic practices and broke open the door so for sale by owners could list in the MLS without having to pay for all the traditional services associated with a 6% listing. Hence, flat fee MLS listings were born also called ‘limited service’.
Limited service really means the ‘un-bundling’ of the 6% traditional real estate business model into a flexible ‘a la carte’ new service where the public would decide on how much service they needed and are willing to pay for.
In a traditional flat fee MLS listing, the seller represents themselves and deals with all aspects of the selling process. In this model, the seller is paying just the buyer's agent a commission which saves 3% over a traditional 6% listing.
Recently, a new flat fee MLS listing has arrived on the real estate seen called a hybrid-flat fee MLS listing where the seller enjoys the same freedoms of a traditional flat fee MLS listing but agrees to pay more money to have the flat fee listing broker represent the seller in all offers, negotiations and closes the transaction just like a full-service Realtor would do.
The benefit of this type of flat fee MLS listing is that the seller still saves 3% over a traditional 6% listing but has the advantage of a skilled professional contract negotiator to represent them when doing business with buyer's agents. Buyer's agents can be very aggressive and by owner-self-represented sellers can be over-matched when negotiating with a Realtor.
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