Published by Kartik Subramaniam
As some of our readers have moved beyond obtaining their real estate license and passing the real estate exam, I wanted to have some content that is a little more advanced for the reader.
After you complete real estate school, you’ll end up working at a brokerage and are likely going to become a member of a local Multiple Listing Service and a member of an Association of Realtors.
As you might already know, the MLS is the Multiple Listing Service and is a database of properties for sale and also contains history of homes that were for sale and those that have sold. It’s really an invaluable tool.
Generally, most MLS systems require that any status updates to a property be reported within two business days of the status change and will result in a status violation if not changed in a timely way.
Broadly, there are two types of MLS statuses:
On market statuses are used on properties that the seller is actively soliciting offers on.
The off market status represents those houses that either have sold or those that the seller is not actively trying to obtain offers on.
I have written the statuses below and have used abbreviations of the statuses also. For example, the “Coming Soon” status is abbreviated by a “C” and the “Active” status is abbreviated with an “A”.
On Market Statuses
COMING SOON (C) This status would be used by a real estate professional when they have a valid listing contract on a property and there isn’t an offer accepted as yet. For this status to be used, the listing firm must have specific instructions signed by the seller to submit the listing as “Coming Soon” and not “Active” - there’s a difference.
While under this status, the agent is permitted to market and advertise the property and must include language that the property is “Coming Soon” and must include the date the property’s status will become “Active”. A key point to remember with the “Coming Soon” status is that the property must not be available for showings while the status is such.
The fact that the property is not allowed to be shown to prospective buyers while in “Coming Soon” is a big deal. There may be agents - or buyers - that see the property online and want to see it in person to get a jump start on the market. This is not permitted while it is listed as “coming soon”.
ACTIVE (A) The Active status is much less complicated than the “Coming Soon” one. The “Active” status is used when a property is On-Market and when the agent has a valid listing contract signed by the seller and no offer has been accepted as yet.
ACTIVE UNDER CONTRACT (U) Like the simple “Active” status, “Active Under Contract” is also technically an On-Market status even though the property has an accepted offer on it.
This status is used when the seller has already accepted an offer but wants the property to remain as an on-market status to collect back-up offers.
This might be a prudent status if the sale is subject to court or other third party approval as those third party approvals can sometimes be hairy and take more time than the current buyer is willing to wait.
It's important to keep in mind that even though the property is still active under contract, the seller generally does not have a right to cancel an existing escrow if they get a higher offer later making this not truly an “on-the-market” scenario.
HOLD (H) Unlike Coming Soon, Active or Active Under Contract, the “Hold” status is an Off-Market status. The agent would tag the property this way when a valid listing contract is in effect but due to myriad reasons the seller doesn’t want any showings. Perhaps this is due to repairs being made to the property or even an illness of an occupant and the seller might not want to show the home on a temporary basis.
WITHDRAWN STATUS (W) If the listing agent on a home is going to use a “Withdrawn” status the agent is indicating that the property is moving to an Off-Market status.
If this contract is going to be used, the property will no longer be marketed through the MLS - despite the fact that a valid listing contract exists.
In other words, the listing is being withdrawn from the MLS but no necessarily withdrawn from the market as a whole. Beware - there is potential to incur a duplicate listing violation if the seller relists with another listing agent and a Withdrawn status is still in effect.
PENDING (P) This status is also an “off-market” one. The listing agent can switch the status to Pending once an offer has been accepted.
The main difference between Active Under Contract and Pending is that when the listing is “Pending” the Seller is no longer soliciting offers through the MLS whereas while “Active Under Contact” the seller continues to solicit offers.
CANCELED (K) Canceled is a unique status as only Brokers and Office Managers have the permission to change a listing’s status to Canceled. The reason for this is that the listing contract is taken in the name of the broker and not the individual agent and as such no individual salesperson has the unilateral ability to cancel a listing.
This is an off-market status once changed to Canceled.
It’s important to note that using Withdrawn instead of Canceled will result in a status violation if tagged incorrectly.
CLOSED (S) Congratulations! If you are switching the status of your listing to “Closed” it means that your transaction has successfully completed and title has transferred from the seller to the buyer. This status is an Off-Market one and a property should be tagged as such after escrow has closed.
If you had a lease listing this could also be used after a property has been successfully leased.
EXPIRED (X) Like the “CLOSED” status, the “Expired” status is an Off-Market status and should be used when the time period of the listing has lapsed and the listing contract has, as such, expired. Most of the MLS platforms will automatically set the status to “Expired” once the time period has elapsed. At the time of the listing being input, the agent is required to specify the Date of Expiration so the system knows when to change the status to “Expired”. If the property sells before the expiration date and the agent has changed the status to “CLOSED” the MLS will not trigger an EXPIRED status after CLOSED.
Choosing the right real estate brokerage to work for should ensure that you are trained up properly and that there are no surprises when it comes to what these MLS statuses actually mean. Some of the above are obvious, but the intricacies of when to use each one can sometimes be confusing.
Hope this helps!
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