The sales information found on the Multiple Listing Service, or MLS, provides real estate investors key insight into their local markets. But, the MLS typically restricts this information to realtors. As such, investors often ask me: Ryan, can you get on the MLS without being a realtor?
Historically, many real estate investors would get MLS access by working as a realtor’s assistant. Now, you typically can’t directly access the MLS, but some states provide home sale info as public records. And, you can now subscribe to third-party data aggregators that include all MLS sales data.
In the rest of the article, I’ll provide some more background on the MLS – and how to access its sales data. Specifically, I’ll cover the following topics:
- Why MLS Information Matters to Real Estate Investors
- Disclosure vs Non-Disclosure States
- MLS Data via Third-Party Data Aggregators
- Accessing MLS Information with Investor’s Edge
- Final Thoughts
Why MLS Information Matters to Real Estate Investors
For fix & flip investors, profit doesn’t exist until after they sell a renovated property. Here’s how it works. Investors begin with a distressed property that they can buy at a discount. Looking at this property, they build a detailed rehab budget, and that budget accounts for A) the after-rehab value, or ARV, of the property, and B) the total costs to bring a property to market (i.e. purchase, rehab, holding, and transaction costs). When you subtract B from A, you arrive at the profit.
But, how do you actually determine the ARV? Before the deal, an appraiser will conduct an ARV appraisal, projecting a property’s value after completing the rehab. But, this is an estimate, and a lot can change in the market between this initial ARV appraisal and actually listing the property for sale.
Accordingly, real estate investors need a strategy for determining list price for a renovated property. If they price too low, they cut into their profit margin. If they price too high, the property remains on market, and investors need to continue eating the holding costs associated with the property.
MLS data helps solve this information. While Zillow and other listing sites provide solid info on what people list their properties for, they don’t provide insight into sales comps. And, listings are just that – listings. They haven’t sold, so the market hasn’t validated these prices. Conversely, when you look at the comparable market sales in an area, you can tell how a market actually prices properties. For fix & flip investors, this means that sales comps prove far more valuable than listing comps. And, generally speaking, you need access to the MLS to see this information.
Typically, you need to be a licensed real estate agent or broker to access the MLS. Historically, real estate investors would offer to serve as assistants for these professionals, as this provided them log-in credentials to the MLS. This behavior was technically prohibited, but it demonstrates the lengths that investors would go to access the MLS and its sales comps data.
Disclosure vs Non-Disclosure States
Currently, accessing the MLS directly remains extremely difficult if you’re not a real estate agent or broker. However, depending on your state’s privacy laws, you may be able to access MLS data via public records.
In states deemed disclosure states, the law classifies all real property sales as public record. As a result, you can pull sales info directly from local tax assessors. While this provides you sales comp data, these records tend to be delayed, meaning you may not have the most up to date information. But, it still gives you an alternative – albeit not a great one – to accessing the MLS.
On the other hand, non-disclosure states consider real property transactions private information. This means that investors can’t just go into their local courthouse to pull sales comp information. As such, in these states, if you can’t access MLS data, you’ll struggle to find sales comp information. For investors, this makes accurately pricing a fix & flip property extremely difficult.
MLS Data via Third-Party Data Aggregators
So what’s the answer? If I can’t access the MLS, how can I find accurate sales comp information?
Fortunately for investors, the MLS has started selling its data to third-party data aggregators. These third parties take this information, format in a searchable and digestible format, and sell subscriptions to investors. This set-up represents the best-case scenario for real estate investors. While direct access to the MLS remains challenging, these services let you access MLS data, which is ultimately what matters.
Accessing MLS Information with Investor’s Edge
Once the MLS began selling its data, multiple third-party sites sprung up, which begs the question: which one should I use?
At The Investor's Edge, we absolutely recommend our own software, Investor’s Edge. Yes, we’re biased, but we firmly believe that we’re justified in this bias. We poured our entire team’s collective real estate experience into creating the best software for investors. This program provides you access to over 90% of the MLS data in the US market, to include tax records, active properties, and sold property information. Simply put, Investor’s Edge provides you the MLS data you need to make informed real estate investment decisions.
More precisely, our Investor’s Edge software seamlessly lets you complete the following tasks:
With Investor’s Edge, you can sort through over 160 million properties to find the perfect deal, and you can do it instantly. And, to fit your particular investment objectives, you can select from dozens of search parameters, ensuring that you only find the ideal property targets. As these results come in, you can save them all in a single, organized list – no more jotting down tons of different properties onto scratch paper.
Save Your Preferences
No matter how many potential properties exist in a database, it sometimes takes a little while to find a deal that fits your investment objectives. We understand this reality. As a result, Investor’s Edge lets you save all of your exact search parameters. Once created, the software will then automatically update your list of potential deals in accordance with these search parameters. In other words, you set your search criteria once, and Investor’s Edge does the rest, automatically updating your list of potential deals as new properties populate in the MLS.
But, finding potential deals doesn’t equal actually closing those deals. Once again, we’ve poured our combined decades of real estate experience into our software to address this problem. With Investor’s Edge, you can market instantly to homeowners. As you narrow down your list of potential deals, our software lets you print postcards with pre-filled addresses or send a voicemail directly to these homeowners – for your entire property list!
This system lets you efficiently bridge the gap between a potential deal and putting a property under contract.
While investors still will have trouble accessing the MLS directly, alternatives now exist. Through third-party data aggregators, investors can access MLS information, meaning that they can A) find deals, B) close those deals, and C) price renovated properties in accordance with the most up-to-date sales comps for their market. And, we highly recommend using The Investor’s Edge software, as we firmly believe it sets investors up for real estate success better than any other data aggregator.
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