For Sale By Owner Homes / Mortgage Blog

Selling on your own? You can really get the word out -- free

For-sale-by-owner types can get listed on a key database, thanks to iggyshouse.com.

Gayle Pollard-Terry | Los Angeles Times
Posted April 8, 2007


LOS ANGELES -- Spreading the word about a home you're selling yourself just got cheaper.

Sellers who go the FSBO (for-sale-by-owner) route can add their houses to Multiple Listing Services in Florida and 19 other states for free via realty broker iggyshouse.com.

There are roughly 900 local and regional Multiple Listing Services in the United States, and the MLS system features the biggest database of homes for sale. But it has long excluded most FSBO homes.

MLS services remain important for sellers because agents routinely depend on them for information, and the database provides listings for online sites, including realtor.com.

Each MLS is privately governed and is not required to accept listings from nonmembers.

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

IggysHouse Realty Inc. can place listings, according to chief executive Joseph Fox, because this licensed realty brokerage firm is a member of Multiple Listing Services. He expects his approach to reduce the number of sellers who depend on agents.

"They are catering to owners who would like to sell on their own, but we recognize they need help," Molony says.

"Our latest consumer survey of buyers and sellers shows that 83 percent of sellers use full-service brokerages, 9 percent use limited brokerages, including discount services, and 8 percent use minimal services."

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

Sites such as redfin.com fall in the middle, offering MLS listings at a discount. Sellers pay $2,000 upfront or $3,000 at closing to list in an MLS in California or Washington, says Redfin's Cynthia Pang.

That compares, for example, with $30,000 -- a 6 percent commission on a $500,000 house, split by agents representing a buyer and a seller. For Redfin's fees, sellers receive a lockbox, signs, fliers and Internet marketing, as well as support in negotiations and closing, Pang says.

IggysHouse is providing the service without charging a fee to consumers.

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

Fox says IggysHouse is paying the nominal cost for the MLS listings to drive more business to buysiderealty.com, his company's original real estate presence on the Internet. That site rebates 75 percent of the traditional commission received by an agent representing a buyer if the buyer finds his or her own home and works with the company's salaried agents. The remaining 25 percent of that commission goes into the coffers of the company.

"Sellers are buyers," Fox says, explaining that most homeowners who sell one house purchase another, and he wants those buyers. BuySideRealty's online business is growing, he adds, although he declined to discuss by how much.

He did give some examples. A buyer of a $2 million house in Beverly Hills recently received a $42,000 rebate, Fox says, and another who is in escrow on a $2.3 million house is scheduled to receive $48,000. Nationwide, the average rebate is $11,000.

Like other sites that assist FSBOs, IggysHouse also sells for-sale signs, directional signs and lockboxes. And, although there might be some money to be made in that area, Fox's top goal is generating more attention to his other Internet business offerings.

Many Web sites offer services for homeowners intent on selling their own homes, among them forsalebyowner.com, which is owned by Tribune Co., parent company of the Orlando Sentinel, and charges $399 for a six-month listing on the MLS and the Realtors' site.

National Multi List(http://www.nationalmultilist.com) offers $229 flat fee until sold.

The Los Angeles Times is a Tribune Publishing newspaper.