As of today, Chicago homebuyers and sellers will no longer be able to rely on the state’s largest real estate listing service to tell them how long homes are sitting on the market in different parts of the city, after the Multiple Listing Service of Northern Illinois decided to stop providing the service, agents have told Yo.
It’s no great secret that market waiting times are starting to increase in many parts of Chicago, and Yo wonders whether the MLS is bowing to pressure from agents who don’t want people to know that the market is softening.
Some realtors Yo spoke to today are in an uproar over the MLS’s decision, saying it will have huge ramifications in the marketplace. Data on average waiting times is critical information when assessing the state of supply and demand in the housing market.
Sellers need to know market waiting times when they are setting a price and also when they’re planning to buy their next home, to help them try and avoid winding up stuck with two mortgages. Knowing how long comparable homes have sat on the market also helps a seller to judge his or her agent’s performance.
For buyers, knowledge of average waiting times gives leverage in negotiating price.
The MLS lists data on most resale properties in Illinois and a number, although not all, of the new-construction developments. The organization has about 30,000 subscribers, mostly real estate agents who use the information to advise their clients. At any given time, the MLS database holds about 61,000 active Illinois listings, according to the agency’s Web site.
According to real estate agents we’ve spoken to today, the MLS ‘s decision means that subscribers can no longer access aggregates of average waiting times via the agency’s database. Subscribers still will be able to determine how long an individual property has been on the market, but even that information will require a more in-depth search than it used to, according to agents we talked to.
Yo called the MLS for comment, and a worker, who didn’t want to be named, said the organization’s board of directors had implemented a policy that decreased available information on market waiting times, but couldn’t give us any further details. None of the directors was immediately available for comment.
Kevin Knepp, an agent with Keller Williams Realty in the West Loop, says he is “sickened” by the decision, saying that a lack of access to such data gives people a misleading picture of the market. For instance, Knepp notes that average home prices and sales volume increased in the West Loop between 2004 and 2005, giving the impression that it’s a “phenomenally great” market. But the average market waiting time increased by 28 percent in that period, indicating that although the market is fairly strong, it also is showing signs that buyers are starting to resist the rising prices.
Some real estate agents, like Charles Huzenis of Jameson Realty, welcome the MLS’s move. A big part of Jameson’s business is the sale of new-construction developments. New-construction units are listed on the MLS as soon as pre-sales begin but many buyers don’t want to purchase a unit until they have seen the finished product, Huzenis says. The average high-rise project takes about three or four years to be completed, so the unsold units end up with long market waiting times and that tends to deter buyers, who then assume that there is something wrong with the unit, Huzenis says.
We’ll keep you posted on what the MLS has to say.