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Out here all listings have to go into the MLS within 48 hours of signing the listing agreement. Agents can't put up a sign or do any coming soon advertising if the home is not in the MLS. I like the coming soon listings because you can tell your buyers (out here we can) what is coming on the market. I find it helps with buyer anxiety in low inventory markets.
There are 100% no showings/neighbor opens/broker opens/open houses of any kind during the coming soon period. If someone wants to see it, it must be an active listing and once you put it active, you can't put it back to coming soon. To prevent that active for one hour kind of nonsense that would ensure.
Well, the MLS membership pledges cooperation with other brokers. In my local MLS, that includes access to listings.
In return, they get to use MLS privileges, including distributing listings, calculating comparable sales, showing other agents' listings, and bragging about MLS data confirming their closing performance.
When a Coming Soon sign is out for a month, and there is traffic, and suddenly the agent puffs about selling in "0 Days," there is usually a breach of that pledge and abuse of the privilege.
Outlawing dual and designated dual agency would take a lot of motivation out of the abuse.
The MLSs have another concern. They may be seen as enabling pocket listing distribution and advertising for scam agents who use the "NO SHOWINGS/Coming Soon" abuse to abridge Fair Housing Law, to limit ethnic groups, LGBTQ, disabled folks, and other protected classes' fair access to the housing market.
And, as consumers, it may be worth considering:
If an agent will willfully lie to their MLS Colleagues, and willfully help their clients sell to less than the full market by limiting showings in pocketing the listing, why wouldn't they lie to and cheat anyone for a quick buck?
No offense, as you seem to be an honorable, ethical individual, but with or without the "coming soon" business, we've been lied to and cheated by several real estate agents over the years.
I can see how it could be used to abridge the Fair Housing Law, has this been a problem?
It seems the main two problems of these "pocket listings" are that it tends to the keep the sales in house thus not giving everyone a fair shot at selling the house, and it gives agents bragging rights to selling within a shorter amount of time than actually occurs.
From a buyers' and sellers' perspective, I can see where sellers' might accept less than they could get if they waited until it actually went on the market, and buyers might not have a chance at a house if their real estate agent is not on the ball, scoping out upcoming sales.
A friend buying a home in Hendersonville said she was frustrated by how many times homes would show up on the MLS listing already under contract. She was watching several neighborhoods, and none had "coming soon" signs, so something else must be going on here.
And, as consumers, it may be worth considering:
If an agent will willfully lie to their MLS Colleagues, and willfully help their clients sell to less than the full market by limiting showings in pocketing the listing, why wouldn't they lie to and cheat anyone for a quick buck?
As a Seller, I have every right in the world to not open my house up to the full market, as long as I don't discriminate based on protected classes. If I only want Master Gardeners to buy my house, that is my right. If I only want dog owners to buy my house, that is my right. I am under no obligation to make sure everyone has a chance to see the house before I sell it.
A friend buying a home in Hendersonville said she was frustrated by how many times homes would show up on the MLS listing already under contract. She was watching several neighborhoods, and none had "coming soon" signs, so something else must be going on here.
In fact, some sold and never had a sign at all.
So I've sold homes off-market where the buyer and seller knew each other, or a friend knew one party or the other. In order to be involved in a transaction representing the seller, we need to have a listing agreement. At least out here, we do. So we have listing agreements for one buyer. Since MLS rules out here require entry, we enter the listing as under contract when we enter it. This is really common in some neighborhoods that have a lot of community activities and the people in the community know each other well.
Not everyone wants to get the home ready to sell, leave for showings, etc, but they also don't want to do the iBuyer, we pay cash for homes route either.
So I've sold homes off-market where the buyer and seller knew each other, or a friend knew one party or the other. In order to be involved in a transaction representing the seller, we need to have a listing agreement. At least out here, we do. So we have listing agreements for one buyer. Since MLS rules out here require entry, we enter the listing as under contract when we enter it. This is really common in some neighborhoods that have a lot of community activities and the people in the community know each other well.
Not everyone wants to get the home ready to sell, leave for showings, etc, but they also don't want to do the iBuyer, we pay cash for homes route either.
During the six months she was looking, there were at least a dozen homes maybe more that showed up already under contract on the MLS. Hard to believe that in the three neighborhoods she was watching at dozen homes sold to friends and neighbors.
She explained to her real estate agent that if she had to call all the agents in town and explain what she was looking for, she would.
Two weeks later, her agent called her with a house that was coming on the market. She looked at it and bought it.
As far as I know, there was never a sign in front of her place.
"Coming Soon" is not a thing in my small Florida area but I've encountered an MLS listing that was sold before the agent listed it, so really the same thing as the OP described.
The last property this happened I called the listing agent as soon as I saw it on MLS. I am not an agent, just someone who browses RE looking for a specific type of property, this one was perfect for me. He said "It's sold" I said "Really? It just went on MLS, do you have a signed contract?" He admitted he didn't have a contract yet. My reply was "Then I can make an offer, right?" He reluctantly said yes but it would have to be more than the listing price. I said no problem. Then I called an agent I knew was familiar with the area and asked him to be our agent. (He was a complete waste of time but another story).
Yes I bought it, even though the agent already had his buyer lined up (planning to get ALL the commission not half) and probably set the listing price that his buyer wanted. I paid a little more.
Not the first time this has happened (3x I can remember). I've dealt with sellers agents who did not respond to legit offers, again seeking to get ALL the commission even without a buyer lined up in advance. I have a very negative view of 90% of real estate agents due to this type of behavior.
Out here all listings have to go into the MLS within 48 hours of signing the listing agreement. Agents can't put up a sign or do any coming soon advertising if the home is not in the MLS. I like the coming soon listings because you can tell your buyers (out here we can) what is coming on the market. I find it helps with buyer anxiety in low inventory markets.
There are 100% no showings/neighbor opens/broker opens/open houses of any kind during the coming soon period. If someone wants to see it, it must be an active listing and once you put it active, you can't put it back to coming soon. To prevent that active for one hour kind of nonsense that would ensure.
Excellent rule. Our MLS allows the "1 hour Active" showing window. It should not be allowed.
No offense, as you seem to be an honorable, ethical individual, but with or without the "coming soon" business, we've been lied to and cheated by several real estate agents over the years.
I can see how it could be used to abridge the Fair Housing Law, has this been a problem?
It seems the main two problems of these "pocket listings" are that it tends to the keep the sales in house thus not giving everyone a fair shot at selling the house, and it gives agents bragging rights to selling within a shorter amount of time than actually occurs.
From a buyers' and sellers' perspective, I can see where sellers' might accept less than they could get if they waited until it actually went on the market, and buyers might not have a chance at a house if their real estate agent is not on the ball, scoping out upcoming sales.
A friend buying a home in Hendersonville said she was frustrated by how many times homes would show up on the MLS listing already under contract. She was watching several neighborhoods, and none had "coming soon" signs, so something else must be going on here.
In fact, some sold and never had a sign at all.
Most people would agree, for a seller to realize the best possible price, a property should be exposed to the greatest number of potential buyers.
One of the concerns with pocket listings is the agent proactively declining to expose the property to the greatest number of potential buyers, and thus, the seller is being improperly served by their trusted fiduciary who is engaged to help them achieve the best possible price and agreeable terms.
This, by any measure, is not an insignificant concern.
Artificially and proactively deflating closed sales prices also may affect closed comparable sales, and affect market values and pricing.
While the concern with buyer sense of unfairness is secondary, it also is very widely felt among buyers, and is a driving force behind reforms to clarify.
These practices have contributed to an unhealthy market. The proposed rule by NAR probably is inadequate to stop agents from acting in their own interest over that of their clients, but NAR is at least considering some sort of action.
Here's an example where the current rules against pocket listings or 'coming soon' marketing has really created an unnaturally awkward situation for me.
We had a situation on facebook where someone asked, in a local group, if anyone knew of any small homestead type farms coming available for sale in the area... I responded in a friendly way, introducing myself as an agent who would love to help them find a small homestead farm.... until I found out they already had a buyer's agent, they were just asking on their own, because they felt they had seen everything out there so far and hadn't yet found what they wanted.
Well, we had a facebook friend who was in the same group, who had a farm that fit this person to a "T", had interviewed us a couple weeks earlier, and told us they would be listing their home with us in the next few weeks/months when they got a few things in order on their end. She spoke up in the group and actually TOLD the person she was planning on listing with me soon and maybe their farm would be a good fit.
I had to meekly tell her in private that I was not ALLOWED to mention or describe her farm to this buyer until it was listed. I said she was free to talk to this person and pass along any and all information about it, and if it came to an offer we could help but I had to bow out of doing anything that could arguably be said to be "pre-marketing", including location, acreage, features, price, etc.
IMHO that made me look pretty useless and lame. Here I was, telling this seller I can't talk to a buyer she would have to do it herself. But this is one of the infractions our MLS punishes for frequently, and I didn't want to break the rules.
I understand the goals of this rule, but I'd still like to know how the public is better served by me NOT telling a bona fide interested buyer about a property I that KNOW is coming up soon.
The pocket listings we have in my area are typically done to hide/reduce the amount the house was actually bought for, and thus, reducing the property taxes on the home.
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