Don't get too excited about that cute cape or spiffy colonial you listed online. It may not really still be on the market after all.
More than a few homes are being listed as active on popular real estate websites when in fact they are all but officially off the market, under agreement to a buyer but not yet officially sold.
Fortunately, come May 21, MLS PIN will close this loophole, giving buyers a more accurate picture of what is actually for sale and what is under agreement and off the market.
Yet it all comes a little late, with the spring selling season entering the fourth quarter here.
To blame is an oddity in the way MLS-PIN, the real estate industry controlled data service, has reported this crucial info.
Brokers using the data service get the full-story, with flags next to homes that are under agreement, but still have a contingency to clear before the sale goes through.
Sure, some of these are serious contingencies and could very well preclude a sale from going through, but many are simply pro forma and are not likely to have any impact.
But by the time the listing gets to your favorite real estate website, these homes that are under under agreement, but with some minor contingencies, are simply displayed as active listings.
There's no mention that another buyer has already has inked a purchase and sales agreement to buy the home. Anyone looking at it would think they could just call the broker and go on a tour.
However, the upcoming change won't help all the frustrated buyers out there who wasted time looking at listings that were no longer active.In fact, some brokers may have even been using these no longer active home listings as a way to bait buyers.
That said, many brokers were none too happy about this either, having to deal with disappointed clients who called about a house they had spotted online, only to have to tell them it is off the market.
At any rate, the new system will have its own wrinkle, with some pending sales to be marked as "contingent," though buyers scrolling real estate websites will at least now be able to see this flag.
Here's the memo MLS PIN sent out on the change:
As you know, we've previously announced the decision of MLS PIN leadership to do away with the Active with a Flag status. The effective date of this change will be Tuesday, May 21, 2013. As a reminder, what this means is: ACT with a Flag Will Change to UAG as of May 21
All listings that are ACT with a Flag will automatically be changed to the UAG status. Starting May 21st, you will be required to mark a listing as UAG when you have a fully executed offer to purchase. Please note, we will still have the ACT with a Kick-out status (ACT), available only for those listings with an offer that has a kick-out/right of first refusal contingency.
In the months following this change, we will be releasing a new status called 'Contingent' (CTG). This new status should meet the needs of those listings that have accepted offers but are continuing to show for additional offers, while eliminating some of the issues associated with the abuse of the Active with a Flag status.
The CTG status will be an "active" status. However, it will be displayed as CTG and not ACT. Additionally, this status will be fed out to all third party websites as 'Contingent,' not as 'Active.' This should eliminate much of the confusion in the marketplace. Finally, there will be a set of six choices for which you can mark a listing CTG. There will no longer be an option to leave a listing ACT for any reason. The CTG must meet one of the following conditions:
b. Attorney Review
e. Third-Party Approval
f. Pending P&S
With this change, we will also be adding in an Offer Accepted Date field. This field will allow you to better track market activity by seeing when offers were accepted in situations where properties have remained "on the market."
Look for more information on the release of the new Contingent status in the weeks to follow.
Your MLS PIN Team
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