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A pocket listing is a real estate industry term used in United States which denotes a property where a broker holds a signed listing agreement (or contract) with the seller, whether that be an "Exclusive Right to Sell" or "Exclusive Agency" agreement or contract, but where it is never advertised nor entered into a multiple listing system (MLS), or where advertising is limited for an agreed-upon period of time.
If ONE of the reasons for hiring a selling agent is to get into their network/the MLS network--i.e., get as much exposure for your listing as possible, it seems to me that having your agent stick the listing in the 'quiet' pile does not espose the property to a broad population of buyers.
Depends upon the totality of the circumstances. I know several nearby homes that were "pocket listings" until this week specifically because the families had graduating high schools seniors -- they did not want the hassle of having the housing look "listing ready" while their kids were studying for finals / planning on graduation parties. Now that the event is over the signs are in the front lawn but some of the folks that were interested in a bigger home because of the impending move / life event were able to help spread the word through the grapevine. Seems like a good way for friends to help friends... In other cases there is more of a "poker game" aspect to things -- "I don't want to list until I can undercut / overshot the guy around the corner by a couple a grand" and that really does not help nearly as much...
They can mean in effect different things in different areas.
I know an area where there are a lot of historic homes. There are a less than handful of realtors actively selling those historic homes. So homeowners (not truly 'sellers' yet) have said to the realtors or to just one realtor if they had anyone they are already showing who the realtor feels would be a fit with their home, the realtor can show their home.
That way there is notice almost always since many buyers are coming from out of town. Buyers know the house is not actively for sale, the owner doesn't have to sell, the home is not in perfect condition, perhaps the onwer is doing restoration on the columns, then on the veranda, etc. Perhaps the owner hasn't gotten to the back porch floor or the kitchen but is continuing to work...and the price will reflect this as time goes on. And the home may or may not be fully neat and clean inside.
In that area, it's not a typical by owner that will pay a commission to a buyer's agent. It's not a typical listing, even exclusive, because at any moment the owner may say, nah, not right now, I'm liking the house.
It is generally unkown to most people that the house is for sale...well, that the house could be purchased if the situation is right. There is no sign up.
But, several homes in that area have sold that way. At one point we almost bought two that way but decided on a third when that one's sale fell through because the owner had a problem with the people not appreciating his home enough.
In my last area, a pocket listing meant that the house was not actually for sale but could be shown to a good buyer. My house was like that for 9 months until I finally put it back on the market. During that period, someone actually saw it twice but passed on it. My realtor was a friend and we trusted each other. I've also heard of 2 cases where a one-day listing agreement was signed to show the house to a particular buyer.
How do I feel about it/them? If it is my listing I feel great, especially in this market. If it another agent holding it, I don't like it.
As a seller I would be leery because I would be concerned my home is not getting full exposure and my agent is just looking out for themselves. But, sometimes it works for the seller because they don't have a bunch of looky-loos tracing through the house.
Most MLSs has various rules regarding pocket listings. Usually a pocket listing means an exclusive right to sell listing that is supposed to be entered into the MLS. By not entering it, the broker is usually violating MLS rules.
But there's nothing wrong with choosing an alternative form of listing that is non-MLS based if that's what you want. Our MLS requires the seller to sign a statement that indicates that their property won't be in the MLS. Nothing wrong with that. But, typically, the pocket listing around here is a violation of MLS rules and many times the seller isn't even aware that their property didn't make it into the MLS system for awhile.
Most MLSs has various rules regarding pocket listings. Usually a pocket listing means an exclusive right to sell listing that is supposed to be entered into the MLS. By not entering it, the broker is usually violating MLS rules.
But there's nothing wrong with choosing an alternative form of listing that is non-MLS based if that's what you want. Our MLS requires the seller to sign a statement that indicates that their property won't be in the MLS. Nothing wrong with that. But, typically, the pocket listing around here is a violation of MLS rules and many times the seller isn't even aware that their property didn't make it into the MLS system for awhile.
This is what i was thinking.I thought every listing had to go into the MLS
I won't even go into the unethical part pocket listings.
In the areas I've lived in pocket listings are not confused with exclusive listings nor with fsbos where the owner states they will give any realtor a commission for selling. Among those I know, they are just sort of there in the back of the head of a particular realtor or perhaps a handful of realtors just in case they meet someone perfect for this home but the owner doesn't want to be bothered with just lookers. There is nothing official with these.
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