Have you ever wondered what a “pocket listing” is?
Learn a little bit about this trend in hot markets and how an agent familiar with pocket listings can help you sell your home faster or find homes which haven’t hit the market yet.
If you’ve been searching for a home or have been considering selling your home, you may have heard the term “pocket listings” from real estate agents or even friends and family. What is a pocket listing? Where did the term come from? How are pocket listings being used today to buy and sell homes?
Pocket listings are homes which are for sale but not yet widely advertised or entered into typical MLS databases. Often an agent will enter into an agreement to sell a home, but will first reach out to their personal and professional network to see if anyone may be interested in a quick, private purchase. Ideally, the agent knows someone or another agent who has a client interested in the home and the whole process of listing and marketing the home is bypassed.
Originally, pocket listings were typically used for extremely high-end luxury properties with a limited pool of buyers, or with celebrities or other buyers/sellers who wished to avoid any publicity surrounding their transaction. But that’s changed a lot in the past few years, especially in competitive markets where there are eager buyers and relatively little desirable inventory.
You might think pocket listings would restrict the sale price of the home. After all, won’t a good home publicly listed attract lots of buyers, resulting in competitive bids? It depends. Once a home is listed in an MLS database, the home is officially on the market. The longer a home sits on the market (i.e. the higher its “days on market” number is), the greater the possibility the home will see price reductions or low-ball offers.
The pocket listing can be a very useful tool for exploring the level of interest in a home. A savvy agent with a good network will often reach out to their database in order to get a sense of whether the listing has real potential. It’s also a great way to drum up excitement about a house, especially if the agent conducts small, exclusive broker showings of the pocket listing. Pocket listing also gives a wary home seller the chance to see if it’s likely the home will sell for a price they can accept.
Experienced agents with deep connections in the community are the go-to choice if you’re interested in discussing the possibility of buying or selling via the pocket listing approach.
Thinking of listing quietly? Want to see if there are any homes out there which are just about to come to the market? Contact a local REALTOR® to help you navigate a pocket listing situation. Get in touch today.
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