What Is a Pocket Listing in Real Estate and Why Would a Seller Use One?
What does pocket listing mean? A pocket listing-or quiet listing/off-market listing-is an off-MLS home for sale, which is privately marketed through an agent's network to select buyers for privacy, testing the market, speed, or controlling access to luxury properties, often by celebrities or unique homes. They are used by sellers desiring to avoid public scrutiny, to assess the waters, or to acquire a rapid, pre-screened purchaser. Such listings limit competition and can drive down price, while permitting a high degree of control to the seller.
In this blog, you will know about pocket listing, its purpose, use, and legality. Without wasting time, let’s delve into this discussion.
Why Sellers Use Pocket Listings
A seller may use pocket listings for a variety of reasons depending on the situation, urgency, and need. Here are some reasons where pocket listings can be used:
- Privacy & Discretion: For high-profile buyers, celebrities, executives, or when, for any reason, sellers do not want the details of their home sale to be made public.
- Market Testing: A way to assess pricing and buyer interest before fully investing in a public listing.
- Control: To control showings and let a few people inside, to make the house feel exclusive.
- Speed/Efficiency: The agent can quickly sell to a previously well-known qualified buyer in their network.
- Unique Properties: Represents high-end or unusual homes where broad exposure is not necessary or desired.
Examples of Pocket Listing
These are some examples which may give a detailed insight into pocket listing:
The Celebrity Sale
An actor wants to sell his mansion discreetly, with neither paparazzi nor intrusion by common people, so he hires a real estate agent to market it to other wealthy buyers.
The ‘Test Drive’
The seller with the one-of-a-kind house will find out if consumers will pay top dollar without the headaches of an open house; this happens when the agent shows the house to other select agents and their potential clients first.
The Internal Sale
Similarly, there is a large broker who has a buyer interested in a seller's residence. They hold the residence as a "pocket listing" so that they can complete the transaction quickly and perhaps retain the commission.
Key Considerations
There are key factors to be considered when it comes to pocket listing:
Smaller Buyer Pool
Significantly reduces the number of prospective buyers, which could translate to reduced competition and a possible lower selling price compared to a public offer.
Transparency
The National Association of REALTOR's (NAR) Clear Cooperation Policy affects REALTOR's listing by requiring the listing of pocket listings on the Multiple Listing Service (MLS) within one business day of their marketing to avoid discrimination and to allow all interested buyers an opportunity to purchase the homes.
Conclusion
Pocket listing provides sellers with the advantages of discretion along with the ability to buy or sell their property with ease. This may be particularly useful for sellers who wish to maintain their privacy throughout the sale process or those who wish for the process to be completed quickly. However, pocket listings do have some disadvantages.
If you’re thinking of an off-market sale of your house or just need a quick and easy sale, Bama Home Buyers can help. There will be no viewing or listings.
At Bama Home Buyers, we invite you to contact us today to make your selling experience smooth and get a fair cash offer. If you accept it, we are ready to guide you through the selling cycle. Let’s say if you don’t like it, you can give a counteroffer or simply walk away.