When it comes to selling a home, most people opt for the conventional route: contacting a real estate agent and getting their property listed on popular real estate websites. However, there's an alternative approach known as a “pocket listing." But what exactly is a pocket listing, and why might you consider this stealthy method for selling your home?
A pocket listing is a property that's technically for sale, but it won't appear on the multiple listing service (MLS), the database that real estate agents use to search for properties for their clients. You won't find pocket listings online or by spotting a "For Sale" sign in the yard. Instead, the listing agent keeps it close to their chest and shares it with a select group of trusted agents who can connect them with the right potential buyers.
While pocket listings make up a relatively small percentage of total listings, typically less than 10% of the national total, they do hold appeal for certain sellers. Here's why some sellers choose this discreet approach:
Why Choose a Pocket Listing:
Privacy: Some homeowners value their privacy and prefer not to have their sale widely publicized or their home's interior plastered all over the internet, especially high-profile individuals like celebrities. With pocket listings, only pre-qualified, vetted buyers get to see the property, avoiding the hassle of curious onlookers.
Market Testing: Pocket listings allow sellers to gauge potential buyers' interest and offers before making the listing public on the MLS. This way, you can set a more accurate listing price and reduce the risk of having to lower it later.
Limited MLS Exposure: A property on the MLS can attract a lot of attention, but it can also raise questions if it lingers on the market without selling. A pocket listing can help avoid this public scrutiny and any associated stigma.
Motivated Buyer Match: For homeowners on the fence about selling, a pocket listing can help find the right motivated buyer quickly, potentially resulting in a smooth, expense-free transaction.
Reduced Commission: Negotiating a lower commission may be possible since less marketing effort is involved with pocket listings.
Downsides of Pocket Listings
While pocket listings offer privacy, they come with some drawbacks:
Limited Exposure: MLS listings can be seen by millions, increasing the chances of finding a buyer quickly.
Lack of Walk-In Traffic: Potential buyers often drive through neighborhoods and look for "For Sale" signs. Neighbors may also know of friends and family looking for nearby homes.
Potentially Lower Price: Without exposing your property to the market, you'll never know its true market value. Fewer interested buyers can result in fewer and possibly lower offers.
Is a Pocket Listing Right for You?
Most real estate experts recommend the traditional MLS route, as it offers maximum exposure and typically fetches top dollar for your sale. However, pocket listings aren't exclusively reserved for the rich and famous and can have benefits for regular home sellers. It's essential to weigh the pros and cons of both approaches before deciding which one suits your needs best.