I fear I may have opened Pandora's box to some degree yesterday when I mentioned that the buyers who purchased a listing of mine in Peoria found the home on craigslist. I already imagine the unrepresented sellers (nee FSBOs) adding this success as further proof that real-estate professionals are superfluous to the real-estate transaction.

In truth, what this situation represents is a buyer finding the proverbial needle in a haystack. Yes, my clever description (thank you ASU school of journalism) and great photos helped pique readers' interest to where they wanted to view the property. (And I've had more than one response so far.)

There are two factors working against craigslist as a viable alternative to the MLS. First, the format for the site is somewhat less than user friendly. Entries are posted as they come in and sorted only by day. You've got a handful of words to differentiate yourself from the crowd, and that crowd only has limited search capabilities. Unlike the IDX-powered MLS search on my site, visitors to craiglist cannot search by price. They can't really search by city, at least not unless the city's been entered correctly in the searchable portions. They can't specify how many bedrooms they may need, how many bathrooms or a host of other characteristics. Instead, visitors must sift through the hundreds of listings and hope to find one that matches their criteria, much less many.

Second, human nature gets in the way. Many homebuyers, even though they are working with real-estate professionals who presumably are searching on their behalf, continue to search independently. They find a property and then notify their agent to have them look in the MLS, schedule a showing, etc. (As an aside, if a buyer lacks confidence in their agent's ability to find the right house for them, they probably ought to reconsider the agent with whom they're working.) But the bulk of buyers let their agents to their jobs and find the houses for them. And agents aren't searching craigslist, largely due to the aforementioned search limitations.

There also is an issue with compensation - if you read my post about NAR President Thomas Stevens' explanation of the MLS, you already are aware that one of the key components of the MLS is the offer of compensation to cooperating brokers. For unlisted properties in craigslist, compensation only comes a) if the seller is willing to pay a brokerage fee or b) if the buyers have signed a buyer broker agreement and agree to pay their agents' fee. Adding 3% (or whatever the agreed upon brokerage fee) to a sales price, closing costs and down payment often can price a potential buyer out of a home, making the craigslist home a non-viable option unless they choose to enter into the biggest purchase of their life without any professional representation.

At lunch today my broker squirmed slightly when I mentioned craigslist, at least initially, as it could some day pose a threat to the MLS. But as we discussed the matter further, he and I (as well as the others at our table) agreed craigslist, like the MLS, is only as effective as the overall pricing and marketing plan for the home. And from the standpoint of a listing agent, any forum that conceivably could put a house that I am marketing for my sellers in front of a potential buyer is a wonderful thing even if it's not a panacea.

(And yes, for those who have been reading along, I really like the word panacea. Almost as much as my wife likes the word woeful - don't ask; I can't explain.)

(c) Jonathan Dalton, 2006 / Jonathan Dalton's Arizona Homes