Click here to read The Changing Business of Real Estate: Part I


This is part two of the changing business of real estate. Part one took a look at the business of real estate from the buyer's perspective primarily through the eyes of BuySide Realty. This part will look at things from the perspective of the seller through the eyes of BuySide's sister company called IggysHouse.

The Sell Side

Nearly everyone has the capability to find and buy a house on their own accord. Selling a house may be trickier. However the rewards of doing so successfully are substantial. At the current 6% commission rate, one can save $30,000 in commissions on a $500,000 house by selling a house oneself.

One of the costs associated in selling one's home by oneself is getting access to the MLS. Of course one can bypass that step and just post a sign on the front lawn or subscribe to a service like CraigsList. The problem with the former is that the sign will only be seen by those who drive by and the problem with CraigsList is that only readers of CraigsList will see it.

There are alternative services that will post your listing on the MLS but those are fee based. Compare and contrast those alternatives with what comes free at Iggys.


Iggys Free Services

• List your home on the MLS (Multiple Listing Service).
• Place your home on REALTOR.COM®, the world's largest database of homes for sale.
• Place your property on AOL, MSN, The Wall Street Journal and other popular sites.
• Provide you with your own web site to post as many photos, videos, and details as you'd like to showcase your home.
• Give you a toll-free number and voice mailbox for every MLS listing.
• Send you instant notification of any inquiries from buyers.

I am not purposely trying to plug either Iggys or BuySide Realty. I am simply looking at what alternatives people have and the relative merits of each alternative. Clearly it makes no sense (at least in my mind) to pay someone to list your home on the MLS when Iggys will do it for free.

While on the subject of free vs. not free, I gave BuyOwner, the leader in For Sale By Owner services since 1984, a call. As part of its fee based service it will put your listing in Buy Owner Magazine. For an optional fee it will place your house in the MLS. Hmmm. Buy Owner Magazine vs. a free listing in the MLS, which should one choose? Hopefully the answer is obvious. As it sits, I see a substantial threat to the "Thanks Buy Owner" business model.


Do It Yourself

There was an interesting article in the LA Times called An Internet boost for do-it-yourself home sellers.

Without paying a penny, sellers who go the FSBO (for sale by owner) route can add their houses to a Multiple Listing Service in California and 19 other states via a new online realty broker, www.iggyshouse.com.

The MLS — the biggest, most encompassing listing database of homes for sale — has long excluded those who try to sell their homes on their own, with few exceptions. The service remains important for sellers because agents routinely depend on its information, and Multiple Listing Services provide listings for many online sites, including the widely used www.realtor.com, which is owned by the National Association of Realtors.

The Realtors group has established guidelines for an MLS associated with its constituency — member agents and brokers. Most agents are members. Privately governed, an MLS is not required to accept listings from nonmembers.

"It's not a public utility," said NAR spokesman Walter Molony. The result is that sellers who want their properties listed must either agree to pay an agent's commission — generally 5% to 6% of the sales price — or patronize a business that provides an MLS listing for a flat fee or as a part of a package.

But IggysHouse, which expects to be in all 50 states by year's end, Fox said, is the first Internet site to allow sellers to list on an MLS at no charge.

"How is he going to make any money?" NAR spokesman Molony asked.


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