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Rental management tech company RentSpree called on MLSs Tuesday to begin listing rental homes — not doing so costs both agents and tenants money, the company says.
RentSpree says the action would minimize delays for renters, increase efficiency of filling rentals, help agents earn commissions and build their pipelines and generally standardize the rental process over time.
A whitepaper released by RentSpree on Tuesday, also laid out the benefits to agents, landlords, tenants and property managers the company says would happen, if MLSs moved to include rentals.
“Over 60 percent of all rental properties never appear on the multiple listing service (MLS), severely limiting their exposure and profitability for landlords and agents,” the company said.
That means agents are losing on a possible commission of $2.4 billion over time by serving the more than 800 listing services across the U.S., according to the report.
“Without the MLS, brokers and agents would need to create their listing systems, which would result in an inconsistent and incomplete picture of the local real estate market,” RentSpree said. “A way to level the playing field for the rental industry is MLSs requiring listings of leased rental properties, giving landlords the same benefits as sellers through increased exposure.”
Bright MLS, among the biggest MLSs in the nation, already includes rental listings on its service in the mid-Atlantic.
Here are the top reasons RentSpree says the rest of the nation should follow.
Benefits to agents
Agents would be served by increasing agent compensation to create stable income during downtimes, according to the report.
Agents who place renters could be paid either a flat fee per unit, a fee equal to one month’s rent or a percentage of the total annual rent.
MLSs could require a standardized set of data to be provided with rental listings, which over time would ensure accuracy across rental listings.
“When there’s a standard set of fields, it will be easy for agents to add their rentals to the MLS and comprehensive rental data for an area becomes more accessible,” the report said. “As a result, the rental market will function more efficiently for all participants.”
Because many renters will eventually enter the buyer pool at some stage of their lives, agents placing tenants also gives them the ability to build their sales pipeline.
That’s the same mentality being used by online portals, such as Redfin, which acquired rental portal RentPath as a way to boost search engine rankings and build relationships with renters well before they become homebuyers.
Agents would also be able to build the sales pipeline by working directly with landlords who eventually look to sell their properties.
Updates to rentals on the existing portals can be delayed, at times leading renters to apply for units that are no longer available, RentSpree said. Moving rentals onto the MLS would provide more certainty that homes listed are still available, according to the company.
“Tenants would be able to set up showing appointments, share their personal contact information in a secure system, and cut down on fraud,” the report says.
Benefits to landlords and tenants
Independent landlords — who own an estimated 23 million properties nationwide — would benefit because they could more easily rely on agent services to fill their rentals, the company says.
Because occupying homes is a cost to investors, landlords would benefit from the speed and ease of agents handling lease-ups for them.
Because the MLS would add reliability to the transaction, RentSpree says there would be more trust and less fraud during the leasing process.
Inman will reach out to several large MLSs to discuss the concept, along with potential barriers.