Why are REALTORS worried about "pocket listings"?
Bryan makes a good point in his most recent blog post. With inventory getting tighter,pocket listings are becoming more common. I have seen some in Clintonville and Central Ohio, have you seen them in your market?
Mention "pocket listings" to most real estate agents and they'll tell you myriad reasons why they're bad for the agents, sellers, and appraisers. The local MLS will try to fine agents with pocket listings and the local REALTOR leadership will raise ethics concerns. All of this done - even if the agent has an "exclude from MLS form". There's a real reason for why REALTORS don't like "pocket listings" (aka "off market listings") and it has nothing to do with any of that.
A recently article published by NAR would have us believe that homes not placed on the MLS...
- skew a buyers perspective of the market
- aren't available as comparables for appraisers, agents, etc
- a disservice to clients (sellers)
Let's do a little "Mythbusters" investigation on all those claims to see which ones really hold water. Then I'll tell you what is really behind this movement.
CLAIM 1: Skews a buyers market perspective - FALSE! When an off-market listing comes on the market around Silicon Valley the listing agent often sends the information to other agents and managers to "get the word out". They usually get a solid response and the home sells pretty much at market rates.
CLAIM 2: Aren't available as comps - FALSE! This is just plain laziness. Seriously, you can't look in the tax records to find a comp? If you can't find enough market comps the next place to look is the tax records. It's not that hard to do - stop whining.
CLAIM 3: A disservice to clients - FALSE! If the client wants to list "off market", that's their choice. There are many reasons including privacy, price range, strong buyer demand, and others that mean the seller will do just fine selling off market. It is very rare a buyer gets a "deal". What the buyer gets is less hassle.
THE REAL REASON REALTORS HATE POCKET LISTINGS....
Unlevel playing field
The MLS is designed to ensure a level playing field by getting listings to all agents. If a listing isn't on the MLS it means that the only agents who know about it are the ones who are active, engaged, and networked. The idea that a small group of agents, or a single agent, could have an unfair advantage with buyers or sellers just drives the leadership nuts. Never mind the fact that this is already a very competitive business.
My advice for agents wanting to stop pocket listings - don't. Just do a better job of being connected to learn that the market is doing. Personally, the agent who knows about a lot of pocket listings is probably more on top of the market than someone who just checks the MLS. Think about that.
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Bryan Robertson, Broker Associate | T: 650.799.9951 | Email: bryan@serenogroup.com | Website: http://www.BryanRobertsonHomes.com |CA License: 01191946 | Sereno Group - Los Altos branch | 369 S. San Antonio Road | Los Altos, CA 94022
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