The Relative Performance of Real Estate Marketing Platforms: MLS versus FSBOMadison.com
AbstractWe compare house sales on a For-Sale-By-Owner (FSBO) platform to Multiple Listing Service (MLS) sales and find that FSBO precommission prices are no lower, but that FSBO is less effective in terms of time to sell and probability of a sale. We do not find direct evidence of the importance of network size as a reason for the lower effectiveness of FSBO. We do find evidence of endogenous platform differentiation: patient sellers use FSBO while patient buyers transact more often on the MLS (where they avoid patient sellers). We discuss the implications for platform competition, two-sided markets, and welfare. (JEL L85, M31, R31)
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Bibliographic InfoArticle provided by American Economic Association in its journal American Economic Review.
Volume (Year): 99 (2009)
Issue (Month): 5 (December)
Other versions of this item:
- Francois Ortalo-Magne & Aviv Nevo & Igal Hendel, 2007. "The Relative Performance of Real Estate Marketing Platforms: MLS versus FSBOMadison.com," 2007 Meeting Papers 89, Society for Economic Dynamics.
- Igal Hendel & Aviv Nevo & François Ortalo-Magné, 2007. "The Relative Performance of Real Estate Marketing Platforms: MLS versus FSBOMadison.com," NBER Working Papers 13360, National Bureau of Economic Research, Inc.
- L85 - Industrial Organization - - Industry Studies: Services - - - Real Estate Services
- M31 - Business Administration and Business Economics; Marketing; Accounting - - Marketing and Advertising - - - Marketing
- R31 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Housing Supply and Markets
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