Can you keep a secret? Some San Francisco sellers are doing just that, according to the Chronicle. Kathleen Pender reports that pocket listings, or listings that are kept off the MLS system, are growing in popularity in our cold, gray city of love.
“(These listings) have always been around,” Pender writes. “Some celebrities, business tycoons and older sellers don’t want their homes on the World Wide Web and hordes of people traipsing through. But their prevalence seems to be growing.”
MLSListings Inc., the MLS service for Santa Clara, San Mateo, Santa Cruz, Monterey and San Benito Counties, estimates that 7.6 percent of homes sold last year in San Francisco were off-MLS.
There are three major reasons to sell a house off the MLS:
1) The seller wishes to maintain privacy and confidentiality, and to avoid making it public knowledge that they’re selling their property;
2) The seller is uninterested in having open houses or preparing the home for showings. It may be that they don’t need to sell, but are interested in possibly getting a particular price for the property or having someone take it as-is;
3) The seller feels this is the best way to get a high sales price, since buyers who find out about the listing are motivated.
Pender notes that pocket listings are growing, at least in part, because the market is so heated that it’s simpler to privately negotiate a sale. But what are the disadvantages?
In today’s hot market, it sometimes happens that a particular buyer may be willing to pay significantly more than other buyers when in competition for a property. Comprehensive marketing – which includes MLS listings – gets the word out to the optimum number of buyers and their agents. That helps to reach the highest-paying bidder as well as orchestrate as serious a competitive bidding situation as possible.
Lacking comprehensive marketing means that a potential buyer (or buyers) may not hear about a home being on the market in the first place. This means a risk of selling the home for less money, since there’s less competition for it. Selling a home off-MLS may mean finding a buyer willing to pay a good price – but how to tell you’re getting the best price possible? There’s no real way to know.
With that in mind, it can still be a valid decision to go off-MLS – so long as you realize that you may not get that high price that you might have gotten if you were on the MLS. The choice is yours.
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