With all the recent talk of properties selling off-market or before being listed due to low inventory, we decided to get the Public Records of all sales per year back to 2000 and match them up to all the sales in MLSPIN in the same time frame to see if MLS is becoming less useful. This study was based on single families, multi-families, and condos.
MLSPIN adoption was slow in the early 2000’s as most agents weren’t accustomed to having to list properties on the system, many old-school agents were not interested in changing their habits, and there were complaints about the functionality. Mid-2000’s brought about an improvement in the adoption rate when the market started to decline into the housing crisis and brokers looked for more ways to sell properties, so 68% of sales listed in MLSPIN in 2000 eventually increased to 84% by 2008. This increase made it more habitual for agents to post new listings in MLSPIN and by 2013 it had a 92% adoption rate. That’s a 24% increase since 2000.
Looking at the charts, it is clear that MLSPIN did nothing but gain steam from 2000 to 2016, and from 2011 to 2015 over 90% of the sales were done through MLSPIN. Only in the last few years has it decreased slightly into the high 80’s which is due to the extremely low inventory and the simple fact that many more buyers and sellers are finding each other, sometimes even without Realtors.
Even though this has happened, I do not feel that MLSPIN is losing any steam at all. The slight dip in usage is a function of the market and as soon as the market slows down, sales through MLS PIN will increase again. Another factor to consider is that there are a percentage of sales from Cape Cod and the Islands that are listed on Cape Cod MLS and not MLSPIN. This has been going on for a decade, but the only difference now is many more listings are listed on both platforms as Cape Cod agents utilize MLSPIN more and more. With this said, it’s possible that the real usage numbers are even a bit lower, but there’s no real way to tell.
Another reason I feel strongly that MLSPIN will achieve a higher percentage of sales by year’s end is that ‘Coming Soon’ advertising will likely be a thing of the past in the near future if MLSPIN adopts the new NAR rule.
This new rule, named the Clear Cooperation Policy, will require agents to submit a listing to MLS to be shared with brokers from all companies within one business day of advertising it publicly. My prediction is that this policy will, for the most part, eradicate Coming Soon advertising because most agents won’t feel there is really a benefit to marketing a listing as a Coming Soon prior to listing it Active on the MLS. I explained this rule change in great detail in this video in November after attending the NAR meeting in San Francisco. Watch it to get a full understanding of why this new policy was adopted and how it all works, along with my opinions on it. Again, it isn’t official yet at MLSPIN but my feeling is it will be by summer and I am in support of it.
In conclusion, it’s clear MLS is not losing its grip despite the slight decrease in usage over the past couple years. This dip is a result of excessively low inventory in a fast-paced market that is causing roughly a couple thousand more sales a year to get done without being on MLSPIN. Make no mistake- if we were in a high inventory-slow market, this would not be happening for two main reasons:
- Coming Soon advertising wouldn’t be as effective as it is now. If inventory was higher, buyers would have enough selection and wouldn’t have to find sellers before they’re active on MLSPIN. Furthermore, buyers wouldn’t be jumping as quickly at the chance to see a property before other people do.
- Realtors would be putting everything on MLS because they would struggle to sell anything without it.
It’s only a matter of time before we get back to a more normal market and MLSPIN is the end-all be-all once again.