When buying or selling a lake house, you may hear real estate terms you’re unfamiliar with.
One such term could be a “pocket listing.” When hearing this for the first time, it is not uncommon for consumers to ask what is a pocket listing in real estate and how they work.
If you sell your East Tennessee lake home, you’ll likely want to sell for the most money possible and quickly. For that to happen, you need an exceptional Lake Specialist who will price your home correctly and provide outstanding marketing. However, a pocket listing does not accomplish maximum exposure. Quite the opposite. Let’s take an in-depth look at everything you need to know about pocket listings and buying and selling a lake home.
What is a Pocket Listing?
Most real estate listings are entered into the Multiple Listing Service (MLS). The MLS is a database of homes for sale across the United States. It allows real estate agents to cooperate on properties being sold. Agents can scan listings and make their clients aware of a property that matches their needs.
A pocket listing is any property not listed on the MLS. By utilizing various marketing strategies, like word-of-mouth publicity and placement on private networks, the seller can restrict access to potential lake home buyers while only entertaining offers from specific individuals.
So essentially, a home seller who allows a pocket listing will get limited exposure. All the buyer’s agents would not even know the property was for sale. A pocket listing is not typically the way to go when you are ready to sell and want to maximize your profits and sell for the most money.
How Do Pocket Listings Work?
For a standard real estate transaction, the path is straightforward. The seller approaches a real estate agent and signs a listing agreement stipulating that they will sell their property.
Typically, buyers can see lake homes on their favorite home-buying websites once this property has been successfully marketed via MLS. The MLS transfers the data via a feed to sites such as Zillow.com and Realtor.com
The information provides buyers, sellers, and real estate agents with significant advantages – the seller can more easily find a buyer while the purchaser may gain access to additional information on the lake community and properties in their ideal location.
The seller can pique the curiosity of potential customers, driving up the price of their property when several buyers are interested. The odds of a bidding war increase dramatically, especially in robust seller’s real estate markets. Buyers can browse numerous properties, selecting those that best suits their needs.
On the other hand, a pocket listing is not listed in MLS. Sellers that choose the keep a listing off the market may have a specific situation or timeline that allows a pocket listing to benefit them. Examples of these reasons would include wanting to market to a more exclusive/limited clientele and a small circle of specialists, they’re not quite ready to go live on the market, or they want privacy.
Why Would a Lake Home Seller Ever Want a Pocket Listing?
There are limited circumstances where a seller would want a pocket listing. They may need to keep the sale private for some reason. They may not quite be ready to market their lake home yet.
If the seller is a public figure such as a politician or an actor, that could motivate them to keep the sale hush-hush.
Another reason is to ensure the pool of buyers and agents previewing are qualified. Instead of being stuck with a bunch of people viewing the home who can’t afford to buy it, a pocket listing allow you and your agent to work more exclusively with serious contenders through a small circle of specialists. For this reason, it is very common for our Lake Team to work with off-market properties during the crazy post pandemic real estate market.
Final Thoughts on Pocket Listings
When selling a home, it is essential to understand the pros and cons of a pocket listing.
The pros of a pocket listing are that the seller can keep the sale private. Fewer people may visit the home, which could be desirable for a small percentage of sellers.
The cons are that the seller has limited exposure. With less exposure, the home will be harder to sell, take longer, and likely sell for less money. For most sellers, pocket listings are not the way to go.
If you are considering selling your East Tennessee Lake home, we’d love to talk to you! We may have just the qualified buyer looking for a home like yours. We also keep confidentiality until you are ready to decide when you are ready to sell and can help you weigh all the decisions for a successful sale!
Excerpts from Residential Realty Today.
Reposted by Karen Millikan, Lakefront Living, On The Lake Realty.