The Relative Performance of Real Estate Marketing Platforms: MLS versus FSBOMadison.com

Igal Hendel, Aviv Nevo and Francois Ortalo-Magne

No 13360, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We compare outcomes obtained by sellers who listed their home on a newly developed For-Sale-By-Owner (FSBO) web site versus those who used an agent and the Multiple Listing Service (MLS). We do not find support for the hypothesis that listing on the MLS helps sellers obtain a significantly higher sale price. Listing on the MLS shortens the time it takes to sell a house. The diffusion of the new FSBO platform was quick, with the market share stabilizing after 2 years, suggesting it managed to gain a critical mass necessary to compete with the MLS. However, the lower effectiveness of FSBO (in terms of time to sell and probability of a sale) suggests that the increasing returns to network size are not fully exploited at its current size. We discuss the welfare implications of our findings.

JEL-codes: L14 L85 R31 (search for similar items in EconPapers)
Date: 2007-09
New Economics Papers: this item is included in nep-ure
Note: IO PE
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Citations: View citations in EconPapers (8)

Published as Hendel, Igal, Aviv Nevo, and François Ortalo-Magné. "The Relative Performance of Real Estate Marketing Platforms: MLS versus FSBOMadison.com." American Economic Review 99, 5 (2009): 1878-1898.

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Related works:
Journal Article: The Relative Performance of Real Estate Marketing Platforms: MLS versus FSBOMadison.com (2009)
Working Paper: The Relative Performance of Real Estate Marketing Platforms: MLS versus FSBOMadison.com (2007)
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