Tuesday, January 03, 2006

Dislodging MLS

Photo courtesy: fsbomadison.com
As a person who bought and sold two houses in US, I am glad to see the For Sale By Owner (FSBO)concept picking up. The real estate business in US is a perfect monopoly tightly managed by the National Association of realtors.They control the listings that get in to the MLS (Multiple Listing Service) and pocket a hefty commission of 6 - 7% of the sale price to execute the transaction. Commissions alone amount to a whopping USD 60 billion a year. No wonder realtors driver some of the most expensive cars around.

When I sold my first house, I did try to sell it myself but backed out after few months as there were no buyers. But, with the spread of Internet, it is high time the monopoly of the realtors is broken and towards that end, it is heartening to see that process may have began in a small way. A Social worker and a nurse in Madison, WI have been successfully operating a FSBO site for the past five years. This site now has over 2000 listings and account for over 20% all real estate transaction in Madison. They only charge a nominal USD 150 as compared to an average of USD 12000 by the realtors.

Related Sites:
Owners' Web Gives Realtors Run for Money - New York Times (require registration)
National Association of Realtors
Realtor
FSBO Madison