Pocket Listings & Why Some Sellers Prefer Them

A Pocket Listing is a real estate industry term that we use to describe “off market” deals.  Pocket listings occur when a broker has a signed listing agreement with a Seller, but that listing is not advertised widely or entered into the multiple listing system (MLS) or when the advertising is limited for an agreed upon period of time. 

Pocket Listings are not for everyone.  Nevertheless, in a heating market like what we are experiencing on the Westside and in the beach communities, some Sellers are opting for Pocket Listings.  One benefit of being a part of the Keller Williams family is that I have access to Pocket Listings from the 8,000 agents throughout LA county.    

I know some of you may be thinking, “But why would any Seller choose to have a pocket listing in a market where there are bidding wars ?”  That’s a fair question.  If money were the only factor that Sellers considered, Pocket Listings would not exist in this market.   When discussing why some Sellers are using Pocket Listings in our office, some of the following reasons have been mentioned:    

a) The Sellers could be looking for a very specific type of buyer.  In this situation, we work within our own networks to find that buyer within our office.  

b) The Sellers could desire a greater degree of privacy when selling their home because the Sellers are celebrities (yes, it is LA).  Or maybe the Sellers have family or health issues and prefer not to interrupt life with too many potential home buyers visiting the home.   Or maybe the Sellers do not want their nosy neighbors traversing through their home.  I know you’re thinking, “Who has nosy neighbors in LA?  Everyone!”  And the nosy neighbors are usually the first ones to show up at the first Open House even though they are not going to buy.”   

c) The Sellers could have had a bad experience with listing this property or another property on the MLS in the past. Since not all agents are equal, the property could have sat on the market too long because it wasn’t priced well or wasn’t marketed well with another agent.   When properties sit on the market for too long, buyers get the courage to submit even more low-ball offers.    

d) The Sellers may just want to test the waters to see what kind of offers they could get before they allow their broker to list the property on the MLS.  Heck, sometimes the offers submitted when it is a Pocket Listing could be so high that the Sellers won’t even bother with the MLS.

e) Or simply put, "It's their prerogative" (as a 1990s singer once sang).  As agents, we work for our clients, and they tell us what they want to do after hearing our advice.  The best sales are those where the Seller feels comfortable with the sales process and the sales price. 

No matter what the reason may be, the fact is that there are Pocket Listings in this market.  It's my job to make you aware of them. So stay tuned!