SHHHHH. The Skinny on Pocket Listings

SHHHHH. The Skinny on Pocket Listings

Secret ListingsFinally! You’ve gotten pre-approved for your loan and you have honed in on the perfect neighborhood for your new home purchase. The excitement is unbearable as you anxiously check your email daily for new listings from your Realtor. You scour online sources at the touch of a button on your phones, and sometimes even beat your agent to the newest property to hit the market!

As a buyer in today’s market you must be savvy, well qualified, and ready to jump when opportunity presents itself, and that perfect home may never even hit the open market. A seller or their agent might place the home on an online syndicate website, such as Zillow or Trulia, and may even go so far as host open houses to generate interest before even putting the home on the Multiple Listing Service. This can be a huge opportunity for buyers to come in with an offer before there’s any competition, so long as you can find it before it’s gone! These listings are referred to as “pocket listings” due to the agent keeping the information hidden from the masses in their “pocket”. It can be warranted by the seller, or purposely withheld  by the agent who wants to try to represent both the buyer & seller and put more commission in their pocket. In a balanced market, this type of activity would generate buzz pre-list and probably bring in more showings once the home goes active on the Multiple Listing Service, but in a sellers market where homes are selling in under a week, the seller is actually hurting their bottom line because there’s less opportunity for multiple offers.

How can you be sure you’re seeing everything that is available to you?
Here are our top 5 tips for buyers in a market where homes are selling pre-list:

1. Partner with a local real estate expert.
Hire representation that is knowledgeable about the inventory and has great relationships with other Brokers in the area. It is extremely important for buyers to know what listings are about to hit the market before they list so they don’t sell under the table to someone else. Ask your agent to reach out to the neighborhood Brokers to see if there is anything coming soon.

2. Drive the area as often as possible.
Become a sleuth in the neighborhood and be on the lookout for vacant homes, homes being remodeled, a sign post in the ground with no sign, or a coming soon sign. Give the address to your Realtor and have them research it for you.

3. Visit Open Houses.
Carry your Realtor’s business card with you and deliver to the on site agent. Sometimes the agent hosting the open house is not the listing agent, and can make promises about negotiating you a better deal if you ditch your agent and work directly with them. NOT TRUE! You hired your agent because they are good at their job and can negotiate the best on your behalf. Having your own agent is already assumed by the seller and costs you nothing.

4. Sign up for Automatic Updates.
Your Realtor can set up an auto search that notifies you of any listings that meet your criteria in your area of interest. This search is directly linked to the Multiple Listing Service and will be the most accurate source for information. This link won’t include pocket listings, so be sure to sign up for auto searches via a website like Zillow (and your agent should too!) to catch any off market activity. When you see a “Make Me Move”, “Coming Soon”, or just a listing  your agent hasn’t sent you yet, have them research it. Be wary of online price estimates, many websites compare apples to oranges, so ask your agent for a personal value opinion by way of a Comparative Market Analysis or CMA.

5. Don’t Fall Into the Pre-Foreclosure Trap.
Several syndicate websites list “pre-foreclosure” homes in their listing section. These homes are not and may never be for sale. This status simply lists homes with owners that have defaulted on their mortgage. Your agent can confirm if there is a foreclosure date set. The price listed for this type of status is not a list price. Ask your realtor for a list of foreclosure activity in your area for the past year; you may be surprised at the small percentage of distressed sales available to you.

Call today to discuss your purchase goals with our Broker! 619-300-5093
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