ALL YOU WANT TO KNOW ABOUT POCKET LISTINGS - PROS AND CONS
A pocket listing is a term we use in the real estate industry to describe a listing that is not being offered in MLS. The seller, for whatever reason, has made it known to a specific agent typically, or sometimes many agents, that the property can be bought for a specific amount.
What are advantages of marketing your property for sale as a pocket listing? Celebrities or people who are very private may not want photos of home scattered about the internet. Some people just cannot stand the idea being inconvenienced by multiple showings. Making a property that's not available on the open market available for private showings can arguably depict it as more exclusive, and thus, a special buying opportunity. Discriminating sellers can have more choice as to whom they sell their properties when only a small pool of buyers are even being made aware the property is for sale.
But is this the best way for a seller to maximize proceeds from a sale? If the property is never exposed to the open market, can the seller be certain that he or she received top dollar?
What are the disadvantages of marketing your property for sale as a pocket listing? I'll demonstrate with the story of a Lake Lanier home I listed at $1.5 million. I should note that when I say 'listed', it was added to both area Multiple Listing Services. Within a couple days, two buyers had seen the property and both told me offers were coming. I let both agents know to have buyers make their highest and best offers, and we ended up selling the home at $1.65 million. I should note that the sellers had priced the home at $1.5 million after getting a recent appraisal of $1.2 million to allow for what they felt would be needed for negotiating. Both offers came in above list price, and the sellers opted for the offer that was 'all cash' and didn't involve a financing contingency. What do you suppose would have happened had this property only been made available as a pocket listing? While I am privy to a whole lot that's going on in my market, it's impossible to know about all the potential buyers out there looking and waiting on a particular buying opportunity, especially considering that we are in the outskirts of Atlanta, an international city full of potential buyers of lakefront and mountain properties.
Most properties we list don't end up with multiple offers within the first few days. However, there are certain pockets in our local market with extremely low inventory. Some will argue that the inventory is not low due to a certain number of listings being on the market within a certain price point. If you look at those listings closely though, you will see that many have been sitting on the market for months, and one must wonder what is the problem. Most often, it's the price that's the issue. But it could be that it wasn't depicted well in photos causing buyers to rule it out. A properly priced listing will sell in today's market. Buyers are out there, and in most cases, watching notifications of new listings daily and waiting on a particular house that meets their wants and needs.
I overheard a conversation recently where someone said they sold their house for list price within the first week. The next comment was, "Well, the agent must have listed it too cheap." In most cases, that could not be farther from the truth. For today's buyers, I set up a Client Website that notifies the buyers daily of listings that fall within their parameters as to price, area, and other wants, such as a boat dock or a full basement. When the listing hits the market, that buyer looks at the photos and decides if that's one they want to see. A huge reason why it's critical the listing is represented well with photos.
Here's my newest listing...An unassuming ranch-style home in North Hall County with a spectacular back yard listed at $149,900. My bet is that it will be gone within two weeks...We'll see. Check out the video or view more at www.3934PointeNorth.com.