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Off Market Sales -- Who do They Benefit?

By
Real Estate Broker/Owner with Charlemagne International Properties BRE# 01147470

 Networking is the Big Buzz Word in Real Estate

Networking has taken on new meaning in the current real estate market.  There are "secret" networking groups within larger company networking meetings.  "Closed" networking cliques exist as well as "luxury home" networking systems.  Often these networking meetings are by invitation only.  The goal is to sell a property before it hits the open market and receives dozens of offers.

 

In my opinion, this may not be the best route for either the buyer or the seller.  I do think it works well for the agents--there I said it.  If the purpose of placing a property on the Multiple Listing Service is to expose it to a wide variety of agents and their clients, then keeping it as a "pocket" listing and off the MLS is to do quite the opposite.  Yes, I know there can be many reasons for not putting a property on the MLS, but I often wonder if those reasons were truthfully explored with the seller?

 

When I represent a seller it is my duty to work diligently to obtain the highest price the market will bear.  If I only expose the listing to my buyers and agent pals am I really fulfilling my fiduciary duty to my client?  Not in my little black book of moral and ethical codes I try to live by.

 

Likewise, when representing a buyer my duty is to obtain the best deal the market will bear.  If there are 20 buyers bidding for a property what the market will bear may be grossly different than if there is only one buyer bidding on a property.  This is a difficult market for buyers and their agents, but it is crucial to keep the welfare of our clients first and foremost in mind.

Comments(10)

Patricia Kennedy
RLAH@properties - Washington, DC
Home in the Capital

Norma, I soooo agree!  Of course, I want to know all about their little secret pocket listings that my buyers might want, but I am not very subtle when I am the listing agent.

Mar 26, 2013 10:14 AM
Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

These are no more than pocket listings on steroids.  Not good when there's no buying competition.

Good for the agents, not so good for seller/buyers.

Mar 26, 2013 10:18 AM
Mark Loewenberg
KW of the Palm Beaches - Palm Beach Gardens, FL
KW 561-214-0370

depends can be good for the buyer and or seller as it is still creating a transaction regardless of if there are more buyers/sellers.. remember all it takes is one buyer and one seller to make a deal come together

Mar 26, 2013 11:34 AM
Debbie Gartner
The Flooring Girl - White Plains, NY
The Flooring Girl & Blog Stylist -Dynamo Marketers

Excellent points, Norma.  Yes, I can see how this would be good for agents, but not so good for the clients.

Mar 30, 2013 07:44 PM
Sandy Padula & Norm Padula, JD, GRI
HomeSmart Realty West & Florida Realty Investments - , CA
Presence, Persistence & Perseverance
Norma, you are correct; this is a numbers game and the more players, the better for the seller. Sure, it's icing on the cake if the listing agent can double-end a transaction, but has the agent done the best for the benefit of the seller? Not true on many occasions.
Mar 30, 2013 09:29 PM
Patricia Kennedy
RLAH@properties - Washington, DC
Home in the Capital

Hey, Norma,

 I included this post in today’s Last Week’s Favorites.  Please drop by and check it out, and don’t eat too many marshmallow bunnies!

 

 

Mar 31, 2013 01:52 AM
Hella Mitschke Rothwell
(831) 626-4000 - Honolulu, HI
Hawaii & California Real Estate Broker

From a seller's standpoint and for a luxury property, I can see that this would generate a sense of competition right away amongst those agents who are known to have these types of qualified buyers. I don't see any double ending here by the listing agent. This goes on all the time because I see new listings go right to contract on the same day it gets on the MLS. Or if you call, they say there are already multiple offers. Welcome to the sellers market? I don't like it from a buyers agent's standpoint, obviously.

Mar 31, 2013 02:07 AM
Norma Toering Broker for Palos Verdes and Beach Cities
Charlemagne International Properties - Rancho Palos Verdes, CA
Palos Verdes Luxury Homes in L.A.

Thanks Pat!

Mar 31, 2013 02:09 AM
Charita Cadenhead
eXp Realty - Birmingham, AL
Serving Jefferson and Shelby Counties (Alabama)

This is the second post that I've read on this subject in the last couple of days.  It's not that I don't mind working hard for the seller, but pushing off market listings is like working harder and not smarter and who wants to do that?

Mar 31, 2013 02:18 AM
Carla Muss-Jacobs, RETIRED
RETIRED / State License is Inactive - Portland, OR

I wrote a similiar post about this practice a few days ago.  There's not a lot of it going on here, however I am getting very suspect of the "ZERO" days on the market.  Agents are playing hard and fast with the RMLS rules, IMHO.  Unless they have the seller's signature stating that the listing is NOT to be advertised in the RMLS, they may some explaining to do.  I also think this is a ploy to get buyer clients.  The sense of urgency in a fast-paced market, perhaps.  I think it's really against everything I, personally, stand for as a Relator(r) . . . but then I like to practice with integrity and ethics.

Mar 31, 2013 06:22 AM