Whether you are working with buyers or sellers, you can increase your production by paying heed to the off-market listing.
Sometimes considered as an “ugly stepsister” of residential transactions, off-market sales have found their place in the Southern California sun.
According to the LA Times, some of the largest residential real estate transactions of 2015 in Los Angeles County were sold outside the MLS.
In 2016 we’re seeing some strong off-market activity as well, with two of the top sales reported by the LA Times being sold for $12.9 million and $16 million. These transactions represented possibly $500,000 to $1 million in commissions.
As a real estate agent, consider the fact that even a fraction of this amount could substantially boost your bottom line.
What is an off-market property?
An off-market property may also be known as a “pocket” or “quiet” listing. It’s a home for sale that is not listed on the MLS but may be listed by a brokerage.
Besides selling a home as a pocket listing with a brokerage, homeowners can also feature their homes on Zillow’s “Make Me Move” category. Make Me Move allows a homeowner to share information on their home like photos and pricing with prospective buyers.
Doing so can give a homeowner the opportunity to see what prospective buyers may be willing to pay for their home.
Are they exclusive to the high-end market?
Even though off-market sales are more prevalent in the high-end market, it doesn’t mean they don’t occur in markets of all price points.
How to take advantage of off-market deals
Here are several ways real estate agents can get in the off-market game:
1. Network with residential real estate agents outside your brokerage via social media and industry events to get a good geographical coverage of the most recent off-market opportunities.
2. Join a larger firm. If you are affiliated with a national brokerage, chances are they operate a proprietary site that features off-market listings that buyers and sellers can benefit from.
Sotheby’s International Realty, for example, offers its agents access to Concierge, a portal of off-market listings exclusive to their corporate-owned offices countrywide.
3. Research established architect, developer and builder websites to learn what residential projects will be soon coming up in development. Take it a step further by developing a business relationship with these sources, and you may find yourself some listing opportunities.
“Development opportunities for new residential construction are often sold off-market, as are multi-unit residential properties,” said Joe Cilic, senior vice president of the Sotheby’s Brentwood office. “Some buyers of these properties only buy off-market.”
4. Research the MLS for withdrawn, cancelled, and expired listings that could meet your customer’s needs.
5. Access tax records for specific properties and property owners who have owned for more than 13 years.
Owners may be itching to move. According to the National Association of Home Builders, the typical buyer of a single-family home can be expected to stay in it approximately 13 years before moving out.
After this length of time, a homeowner may have built up substantial equity and may be more motivated to sell.
6. Get out in your “farm” and meet with homeowners who are not on the market to expand your potential pocket inventory.
Desiree Lapin is a Southern California Realtor and head of Luxury Real Estate by Desiree Lapin of Sotheby’s International Realty.