The MLS® system is a cooperative selling system used by REALTORS® across Canada. In Alberta, local boards and associations manage the local MLS® System and enforce MLS® System rules for membership. Local board MLS® Systems share their data with the national system operated by CREA known as REALTOR.ca, which consumers are very familiar with. As a system, it is more than simply a website, marketing engine, or searchable database of information, but it is certainly not less than those things. However, one thing that must be understood at the start is that the MLS® System is owned and operated by REALTORS® and is not a public access system, so there are requirements to access the system and its unparalleled benefits.
The first and most obvious requirement is to use a Realtor® member to access this member-owned selling system. This does not mean consumers must hire representation or agency services from a Realtor® beyond those they require. However, there is no doorway to the MLS® system except through a Realtor®. In Alberta, all Realtors® are responsible for following a Provincial rule set which also requires them to use only approved MLS® Listing agreements, which may or may not include representation services.
One of the great benefits of the MLS® System is the confidence that specific data fields are required and that those data points can be reasonably understood to be accurate. Although the MLS® system is never intended to warranty information to a prospective buyer or replace the buyer’s requirement to conduct their own due diligence, the idea is that if the data field in the MLS® system is required, it must be completed before the listing is posted to the system. If it is to be completed, the REALTOR® must exercise reasonable care and skill to ensure the information entered is accurate. This requirement is mandatory regardless of whether or not the seller is receiving representation services from a Realtor® over a simple posting to the MLS® System without representation.
Because GST on real estate is a tax issue and not something REALTORS® can advise on, the MLS® System needed a reliable way of standardizing the GST issues for buyers when comparing residential properties. For this reason, the Provincial Harmonized MLS® System Rules require that the price displayed include any applicable GST. Of course, there are some situations where it is uncertain whether or not the GST will apply, so in those situations, the Realtor® must include a statement in the public remarks explaining this to the buyers upfront.
In order to provide sufficient time for the MLS® cooperative selling system to reach all those who need to see the listed property, there is a required minimum 60 day listing timeframe for all MLS® Listings. This does not mean that it will take 60 days to sell, but rather that at the signing of a new listing contract with a REALTOR®, the seller must commit to the Realtor® for a minimum of 60 days if they are interested in putting their listing on the MLS® System. Of course, anything more than 60 days is fine since most listing agreements for residential property range from 90 - 180 days, but the system will reject anything less than 60 days.
As a cooperative selling system, the MLS® system is bound up in the cooperation of brokerages and REALTORS®, being able to access all listings to show their buyer clients. As the property owner, the seller always maintains the right, under common law in Alberta, to allow or deny access to their property as they see fit. However, once they agree to list their home with a Realtor® on the MLS® system, they also agree not to restrict access to cooperating Realtors® even if they have some disagreement or previous history with them. The seller can instruct their Realtor® in such situations to be present for the showings or insist on being present themselves (although that may not always be advisable); however, what they cannot do is refuse to allow Joe from ABC Realty Inc. to show the property to their clients. If that becomes a sticking point, the seller would need to make arrangements with their Realtor® for alternate options to market the home without the power of the MLS® system.
Similar to the discrimination of a REALTOR® member from accessing the property when the property is listed on the MLS® system, the seller also has one additional restriction concerning showings of the property. Provincial MLS® Rules require that all properties actively listed on the system must be available to show within 24 hours of the request being made by a cooperating Realtor®. This promotes an equal opportunity environment for all cooperating brokerages and Realtors® to view the property without undue time delays, especially in a busy market or when a Realtor® is trying to schedule multiple property showings in a single tour. Life happens though, and the kids may be sick, the hot water tank springs a leak, or Great Aunt Margaret arrives for the weekend unannounced, and the seller simply cannot accommodate showings for a few days, so the option of a temporary withdrawal from the MLS® system is always an option too.
The numbers have been crunched, and the statistics are in; there is no better way to cast the most extensive net around a potential buyer pool than using a REALTOR® to list a property on the MLS® System. The system is as powerful as it is mainly because of the fair-play rules and requirements that all MLS® Listings and Realtors® must follow. Sellers don’t have to use the MLS® system to market their property, but no one can deny its effectiveness or reach.