Massachusetts home buyers who have been actively searching for homes are well aware of the lack of real estate inventory available right now, but would-be home buyers only searhing online may be unaware of how little inventory there really is available.
MLS Property Information Network (MLS PIN), the primary multiple listing service in Massachusetts, has decided to change the way home listings are displayed after a seller accepts an offer starting today (Tuesday May 21, 2013). MLS PIN will do away with the "Active" with a flag status (ACT) and require listing agents to list homes with fully-executed offers as under agreement (aka, UAG). Listings marked as active with a flag status on May 21, 2013 will automatically be changed to UAG.
The active status will only remain when a buyer and a seller agree to what is referred to as a kick-out clause. A kick-out clause is used when the agreement between the buyer and the seller is contingent upon the buyer selling a home or similar contingency.
Home listings marked as active are considered available inventory on public-facing Web sites that provide MLS home listings, but with the change in status less listings with be considered as part of the available real estate inventory. Presently, the available inventory is not a true representation of what homes and condominiums are available to Massachusetts home buyers.
The change is welcome by many Massachusetts buyer agents and Massachusetts home buyers. There has been growing frustration by home buyers who think a home is available to see, but it really is not available. Many listing agents were marking properties as active with a flag, but refusing to show the property any more. Home listings marked active with a flag are suppose to be available for showings, so home buyers could make back-up offers. Very few of these homes were made available for showings after offers were accepted by sellers. The active with a flag status was very confusing to Massachusetts home buyers.
Once the listings are set with an under agreement status, the homes will not show up on public-facing MLS Web sites. These Web sites will now show a true number of available homes for sale.
Over the next few months, MLS PIN said it will be releasing a new status called "Contingent" (CTG). MLS PIN hopes the new status will meet the needs of those listings that have accepted offers, but are continuing to be shown 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, the CTG status will be distributed to all third party websites as "contingent," not as "active." MLS PIN hopes that CTG will eliminate much of the confusion in the marketplace. Also, 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 "Active" for any reason. The contingent status must meet one of the following conditions:
Of course if listing agents use the CTG status, but refuse to show the property, home buyers and buyer agents will be no better off than before the elimination of the active with a flag status. All the changes will be for nothing, if the CTG status is used the way the active with a flag status was used. Stay tuned.