If you Google the phrase “what is a pocket listing?” it’s likely you’ll encounter a heap of negative reviews.
And for good reason.
A pocket listing serves the best interests of the listing agent, not the seller. The agent keeps your home off the MLS and only advertises it directly with their own clients and prospects. All other agents are purposefully left out of the loop.
This means the agent gets to generate new clients while often doubling their own commission by dealing with both the buyer and the seller.
But it’s important to make a distinction at this point.
Recently, pocket listings have become mistakenly confused as being the same thing as a pre-MLS or non-MLS listing.
Which isn’t correct at all.
A non-MLS listing involves strategically advertising your property to a niche group of highly influential agents.
In the case of Top Agent Network, that group is made up of the top 10% of agents in the area. These agents sell over 90% of the properties and represent over 90% of the true homebuyers in the region.
A pre-MLS listing involves keeping your property off-MLS for a limited period, with the intention of eventually going on the MLS.
In both cases, your property is not hidden away. So why have pocket listings become confused with non-MLS or even pre-MLS listings?
Largely, it’s because both approaches involve keeping a listing off the MLS. As a result, the terms have become used interchangeably.
But as it’s hopefully now clear, there’s an important distinction to be made.
The buzz around off-MLS listings
The increasing buzz surrounding off-MLS listings has been well-documented recently.
According to a report originally featured in the Wall Street Journal, the five counties of Northern California’s Silicon Valley saw a 17% increase in properties listed off the MLS in the first quarter of 2014. That figure was up from 13.6% in 2012.
The reason for this growing trend?
First of all, it’s a sellers’ market right now, which means people can naturally be more selective about how and where they list their home.
Also, selling off-MLS can now be done through more focused, strategic channels.
The need to promote a property to everybody and anybody is in decline because smart agents can tailor a listing to a section of niche buyers, which leads to a faster, lower hassle sale.
A property sold off-MLS often receives a higher price, too. That’s because it kind of acts like a “buy it now price” and a motivated buyer may well seize the opportunity to secure a property and pay top dollar, closing the sale quickly.
In comparison, a property on the MLS runs the risk of getting stale and ultimately selling for less than asking.
TAN has already seen a number of success stories involving people selling without MLS. One such example involved a home seller in San Francisco who received 5 offers on his property within just 1 week after having it up for sale.
‘Coming Soon’ and pre-MLS listings
A growing number of MLSs are now using coming soon features to market properties before they go live.
While an off-MLS listing stays off the MLS definitely, a coming soon listing involves advertising a property to a select group of agents for a limited period, before being listed on the MLS.
However, unlike TAN, many MLSs have their own coming soon (or pre-MLS) category that exposes a property to all MLS agents. So in effect, they’re an MLS listing – just with a different status name.
But when used in the right way, there are a couple of key benefits to this approach.
In the same way that a movie trailer creates interest and intrigue before a film gets released, a ‘coming soon’ feature helps to generate buzz before it goes live.
Also, the process of initially advertising to a smaller pool of buyers provides a useful testing ground to trial a price and make necessary adjustments.
Should you sell your home without the MLS?
Asking the question “what is a pocket listing?” can lead to discovering a flurry of unfavorable online reviews.
But selling without the MLS – when done in the right way, can bring a number of distinct advantages. These include:
- Reduced Hassle: By listing your property with a niche group of the highest producing agents, you’ll eliminate having to give multiple showings to less serious buyers – saving you time and hassle. This is something you can also benefit from with a pre-MLS listing.
- Heightened Privacy: For professional or personal reasons, you might not want a listing to be marketed to everyone. Keeping a home off-MLS means your property will be marketed in the most discreet way possible.
- Helps Market a house that Shows Poorly: Some sellers don’t have time to renovate a property before it goes to market. But an elite agent has the ability to persuade the buyers they deal with to look beyond flaws and see potential.
But selling off-MLS isn’t for everyone.
If you’re selling a typical family home, an MLS listing will ensure you reach the broadest range of buyers possible and naturally receive more viewings. Although with TAN off-MLS you’re only excluding 10% of the real buyers, and they may not be the most motivated or qualified, anyway.
Sometimes an MLS listing can lead to a faster sale, but when you factor in any necessary time needed for preparing and marketing the property, this can end up making the entire process that much longer.
In the end, it all comes down to working out which solution is best for you based on your own personal circumstances.
The Problem with Mass Marketing Unique or High-Priced Homes
When you’re trying to sell a unique or luxury item, mass marketing isn’t the way to go.
Think about an item of fine art being auctioned at Christie’s. The exclusive environment of Christie’s naturally gives a painting a sense of prestige and exclusivity, while attracting a niche kind of customer with the intent to buy.
Now if that same painting were auctioned on eBay, things would be very different. The number of potential buyers would be far higher, but the perceived value of the painting much lower.
That’s the nature of mass marketing. When a valuable product is viewed as mainstream, it inherently feels less special by being available to anyone and everyone.
The same holds true for property sales.
When a unique and luxurious house is listed on the open market, its sense of exclusivity is instantly diminished, and the price it fetches may be considerably lower than if it’d been marketed off-MLS.
While pocket listings clearly don’t serve the best interests of sellers, doing a pre-MLS or off-MLS listing can be an effective way to sell your home, and it’s often the best solution for many sellers.
It offers the opportunity for greater privacy, reduces the hassle of dealing with less serious buyers, and provides a solution to marketing a house that might require refurbishment.
For those wanting to generate marketing buzz or test a price before going on the open market, a pre-MLS listing should definitely be considered.
In the end, both options come with the distinct advantage of promoting your property to the top 10% of agents in the area, which means deals can often be closed more quickly and effectively.
Want to know more about off-MLS properties in your local area?
Or maybe you’re wondering if selling your home without the MLS is a good idea. Either way, you can find a verified top 10% agent in your city by clicking the link below.
These agents have access to non-MLS/pre-MLS listings that can’t be found anywhere else.