What and Why is the The Multiple Listing System important?

What and Why is the The Multiple Listing System important? (The MLS)

The Multiple Listing System (the MLS) is a collection of databases owned by Local Boards of Realtors or Private companies who subscribe Boards in particular state markets that local real estate agents use to input all the data of property listed for sale.  It is the single local source of every property currently for sale on the real estate market in a specific area.  Through the REALTORS union (local board which is a part of the State Board of Realtors which is a part of NAR, the National Association of Realtors & or Realtists (same type of hierarchy)). It allows licensed real estate agents, who are representing sellers under a listing agreement, the opportunity to advertise their listings to other real estate professionals searching on behalf of buyers. The MLS provides the most effective form of advertisement for a seller who is serious about selling their home.

How the MLS works:

Modern technology has provided an open market playground for real estate agents as well as independent home buyers. According to The National Association of Realtors, over 80% of home buyers use the internet to search for homes to purchase. Partial access to the MLS is available to the public on several websites over the internet. These websites provide buyers the freedom to search and explore the MLS without the aid of a Realtor. However, they must contact a Realtor in order to gain access to the inside of a home for viewing. Also, all negotiations and offers to purchase a home must be done through a licensed real estate professional.

To have unlimited access and freedom to submit homes into the Northwest Louisiana MLS, one must own a real estate license issued by The Louisiana Real Estate Commission. When a home is placed on the MLS by a licensed professional it becomes part of a worldwide inventory of real estate. This inventory provides the foundation for a concept and strategy of marketing that does not target the home buyer, but focuses on targeting real estate agents.


Jerel Washington lists every property from Condo’s to Estate Homes on the MLS and the top 25 Tier 1 Real Estate Web Portals for absolute maximum exposure.  Selling a house has everything to do with how many qualified people are able to find it.

How to motivate Realtors to sell a home:

The MLS is basically a tool used to provide real estate agents with motivation for producing buyers and promoting the sale of homes. When working with a home buyer, a real estate agent will consider many factors that are based on the individual preference of his client. These factors include desired number of bedrooms, bathrooms, area of town, square footage, and most importantly the amount of money the buyer is willing to spend for a home. After an MLS search is performed by the agent based on the search criteria, the agent must then consider the amount of commission rewarded to them if the showing of a particular home results in a sale.

Keep in mind that being a real estate agent is a profession just like any other. A Realtor will consider their salary before ever showing a home to a prospective buyer. A Realtor is compensated in the form of a commission agreed on by the seller and the agent. The amount of the commission is usually based on a percentage of the selling price of the home. When proper motivation is provided in the form of an appropriate commission, every Realtor in on the MLS will be competing to bring buyers for that particular home. When the home is sold the commission is split between the listing agent and the agent who produced a ready, willing, and able buyer.

All information regarding a listed home is provided to a real estate agent when the MLS is accessed. The most important information to an agent is motivation for them to bring buyers.

How to understand and break down Realtor commission costs:

In order to understand why a reasonable real estate commission is very important to help motivate agents to bring buyers, consider the following breakdown of a Realtor’s commission once it has been earned:

selling price of the home – $150,000
real estate commission – 6% or $9,000
Listing Agency/Broker to share with Listing Agent – $4,500
Buyer Agency/Brokerage to share with Selling/Buyers Agent – $4,500

Agent Split / Share with Brokerage

50/50 – Very common = $2,250 to the agent then deduct 55% for taxes, fees, and cost of business expenses = Agent Net Commission/Profit – 1,012.50
60/40 – Moderately Common
70/30 – Most Common
80/20 – Fixed High performers
Graduated Scale – Depends on production performance
100 / Cap Commission

After commissions are disbursed to the two brokerage firms, the listing and selling agents must then split their earnings with their sponsoring broker*.

A processing fee is then deducted by the broker in the amount of $350 which reduces the commission owed to the agent to $1,525**. The agent must then consider the annual $780 that must be paid to have unlimited access to the MLS. Other Realtor fees for which the agent is responsible for on an annual basis are dues owed to the Louisiana Real Estate Commission and errors and omissions insurance***. Finally, because a Realtor is an independent contractor, the agent must consider annual taxes to be paid.

*The amount split between broker and agent varies and depends on the agreement between both parties. The amount usually takes into consideration various factors including office space, equipment, and supplies used by the agent and the amount of individual production of the agent. In this example, let’s just say that the agent and broker have agreed to a 50% split.
**Most real estate brokerage companies require agents to pay a processing fee for every transaction made by the agent. These transaction fees vary and can range anywhere from $100 to $550. It depends on the original agreement between the broker and the agent.
***Errors and Omissions Insurance is required by the New Jersey Real Estate Commission to be paid by every working real estate agent in the state of New Jersey.

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