Everyone in real estate profits from mystifying the MLS. Ask around and you'll get a different answer about why it's such a mess. Regulatory capture. Too many standards. Legacy tech systems.

I've spent the last year consulting for a real estate tech startup, navigating MLS data. Looking at API docs from aggregators, reading tri-party agreements, learning what IDX means and why it makes me want to throw up. After a while, I got curious about how we ended up with this clusterfuck.

The MLS (Multiple Listing Service) is fragmented at two levels. When I say MLS, I mean both American and Canadian systems. Same market dynamics, same organizational mess.

The technical layer is the data problem. 500+ local systems with different schemas, field definitions, and data formats. "Pending" means something different in Phoenix than it does in Philadelphia. This layer is getting fixed. RESO is a real standard and adoption is growing.

The governance layer is the access problem. Each of those 500+ MLSs is a separate organization. To get their data, you need a licensing agreement with each one. Different terms, different fees, different timelines. You can have perfect APIs and still spend months in contract purgatory. This layer is far worse and nobody's fixing it.

How did we get here?

Why MLSs Exist

The MLS originated in San Diego in 1885 when brokers started sharing property lists so any member could bring a buyer and get paid. One office rarely had enough buyers for its own listings. One buyer rarely found the right property in a single office's inventory. Broker cooperation made everyone money.

The idea spread. Local realtor boards adopted the same model over the following decades. Meetings, bulletin boards, printed sheets, eventually weekly books with photos. The MLS was a coordination mechanism: you share your inventory, I share mine, we split the commission when a deal closes.

MLSs were centralized within a local market but never designed for cross-market interoperability. Their jurisdiction matched the politics of local realtor associations. This made sense in 1885 when nobody was buying a house in Phoenix from Philadelphia. It makes almost no sense now. The organizational structure persists because the people benefiting from fragmentation would have to vote against their own interests to change it.

When those systems went digital in the 1990s, they carried over the insularity. Realtor.com launched in 1995. Listings became a consumer product. IDX (Internet Data Exchange) formalized broker reciprocity online. RESO is now getting more MLSs to adopt a common data schema. The tech will catch up. That doesn't solve the governance problem.

The Fragmentation Is Sticky

Each local MLS is a fiefdom. Board members, staff, dues revenue, political power within the local realtor association. Consolidating into a national licensing framework would mean those people voting themselves out of jobs.

There's been some consolidation. 50% fewer MLS organizations than 10 years ago. But 50% fewer still means 550. The consolidation that's happened is the easy kind, merging adjacent markets and reducing obvious redundancy. The hard kind would require the turkeys to vote for Thanksgiving.

No one can force it. NAR in the US and CREA in Canada could theoretically mandate a universal data access agreement. Both are controlled by the same people who run the local boards. The people who would benefit (tech companies, startups, consumers) have no seat at the table. The people who benefit from fragmentation control it.

The free market doesn't work here either. You can't build a competing MLS to profit from the dysfunction. The barriers aren't technical. They're structural. Brokers are required to use the local MLS by their associations. Try to launch an alternative and you'll find yourself locked out. No listings, no participants, no business.

The tech is getting fixed. The governance isn't. Absent regulatory compulsion or a structural shift in who captures value, it won't be.