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Comment by mikysco | Hacker News Reader

Aren't all these homes required to be listed on the MLS before being sold? My understanding is a home (at least in California) can't be sold unless publicly listed for X days on the MLS.

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I worked in real estate tech for like five years...

An MLS is nothing but an local organization. There are zero laws requiring a property to be posted on an MLS. I know of zero states with any regulations like what you propose. There's also confusion around the term "Realtor" because "Realtor" isn't actually a thing. It's a brand, a "real estate agent" on the other hand is an actual job.

The real estate industry is *truly* and exceptionally fucked up. The confusion around MLS, "Realtor," and probably loads of other things I'm forgetting are intentional.

"Pocket listing".

https://en.wikipedia.org/wiki/Pocket_listing

Absolutely untrue elsewhere. I sold two houses in PA without them ever appearing on the MLS, which is a privately run, privately owned database. It might also be untrue in CA, but I can't comment on that.

Not necessarily true, and certainly not true if you are selling the entity (usually LLC) that owns the portfolio of properties.

Curious to know how and where you got that impression. There is no such requirement.

There are similar private requirements for the cartel known as NAR. What this means in practice is that pocket listings actually make to to the MLS for one day before apparently being sold "in 1 day".

Zillow as property owner is not part of NAR. Zillow as broker is also not part of NAR, although if they were, they'd do exactly as individuals using pocket listings do. Arrange a sale privately with an institution, place the listing on MLS, then sell it "on the open market" in 1 day.

I think MLS would like to give you that impression. They seem to function as a cartel of some sort. (At least I have never understood their purpose.)

There are over 900 MLS organizations in the US. Their purpose is aggregating the RE listings in a region. This was super important 100 years ago, still pretty important 25 years ago, and now has little utility for consumers now that listings are aggregated online and searchable without an agent across regions with better-than-mls-portal consumer-grade shopping tools.

Today they essentially function as data brokers and unofficial labor organizers, collecting membership dues from agents in exchange for ensuring that the agent's name is on their listing wherever it's shown online and (along with NAR) pushing agents to keep "standard" commissions on their listings (5-6%).

I don't think that is true. I know of intra-family sales where that definitely didn't happen and a quick search found nothing. There may be some internal rules among Realtors (who own the MLS- it isn't a public service) that require that, but a law declaring that would be dictating paying for a given private organizations product, which sounds problematic.

Not true. I sold a condo to Opendoor recently and it was unlisted, just a private transaction. They overpaid very generously too.

> They overpaid very generously too.

How do you know without getting bids from the open market ?

Not op, but a house in my neighborhood was sold to OpenDoor for $397k. It sat unsold for 3 months in an area where other homes are sold over asking on the day that they're listed. They finally have it under contract for $386k for a net loss of $11k.

You can see the transaction history here:

https://www.zillow.com/homedetails/125-Mays-Blf-Fayetteville...

Add in whatever fees go along with the sale, and they're out a fair bit more than that.

I sold another condo in this same complex 2 months ago through a real estate agent. Far more painful process and got much less. Also see here: https://news.ycombinator.com/item?id=29087989

Opendoor still holds it, Zillow is already marking down a similar one by 14%.

Sure, but they aren't required to accept any offers. And the odds of a private buyer making a better all cash zero contingency offer than an institutional investor is pretty slim.

I bought a condo in Seattle from a friend with zero MLS involvement. We agreed on a price, found a purchase and sale agreement online, hired a title company. Took about a week.

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