Not Yet Listed In The MLS, New Listing Not In MLS, Hidden Inventory, Private Inventory, Pocket Listing, Not Available To Other Agents, Exclusive Listing, Office Listing - whatever you choose to call it, it's a new reality in our real estate market. The idea isn't new, it just hasn't been a great way to get a home sold in a few years.
In Orange County, our market went from Extra Cold to Extra Hot so fast, that sometimes we don't even have to put our listings in the MLS to get them sold. This can be a huge disadvantage to a buyer working with an agent who does not have access to any of these listings, and also to the agent who is not affiliated with a large company who has these listings. Whether this is fair or not is arguable, but this is a truth we must deal with.
So why would agent's do this? There are a few advantages. The best advantage (in my opinion) is they can market the listing to only agents they prefer to work with so they don't end up with a knucklehead agent on the other end of the deal. The obvious reasons however are for the agent to "double end" the deal, for the broker to "double end" the deal (in other words, more money to the agent or broker), it allows the agent to control who can make offers on the property, the listing agent can better control the vendors involved, or to keep the sale more private for the sellers and reduce property traffic.
An agent cannot do this without the sellers consent, so it's not like they are keeping it a secret. Certainly, if done for the sole purpose of the agent to make more money, and the seller ultimately has to settle for a lower offer where they would have otherwise received a higher offer, this is a terrible disservice to our client, as well as a violation of our code of ethics. This seems to be the case on some shortsale listings I heard about recently. I was told an agent was submitting buyer offers that they were secretly representing, even though they had other higher offers the bank might otherwise accept. That's not to say all agents have a bad intent and I've seen this work to the sellers advantage time and time again. I just hope agents do the right thing for the right reason.