Pocket Listings: The Tighter The Real Estate Market, The Worse The Idea

Back in January I posted on Pocket Listings: The Growing Fad To Sell Homes “Not On The MLS” and how it’s a really bad idea for sellers and really isn’t very good for buyers either. In a nutshell, why would you offer a home for sale to a limited pool of buyers and run a high risk of missing the buyer who would pay the highest price and/ or missing the opportunity to get the highest and best offer from every buyer?
The very next day an email went out from OffMLS explaining why their service was important and the CEO of Top Agent Network published a blog post on Why Would A Seller Choose Not To Go On MLS? Was the timing coincidence? I think not.
It’s worth reading the Top Agent Network blog post and the comments below it because I’m going to have to summarize here but the argument is pretty thin, except with regards to privacy concerns. Without a doubt if you don’t want to go public with your home then this is the way to go. However, with regard to their other points:

  • Restricting showings to only highly qualified buyers – if that’s your objective your real estate agent should still list on the MLS and do a better job of screening potential buyers. You can even ask for proof of funds before showing the home.
  • Conduct a discreet transaction – this is essentially the same as the privacy concern point.
  • Market a house that does not show well – and what makes them think that this will be less of an issue for buyers that come in from this channel than for buyers coming in from the MLS? And what would be lost by showing it to MLS buyers? I don’t get it.
  • 10% of the agents sell 75 – 90% of the homes and have the most qualified buyers – a) that percentage seems high b) so broad exposure is a good thing? That’s what the MLS is for. c) prove that they have the most qualified buyers.
  • Test a price – so they are worried about damaging the future marketability of a property so they are going to test the price on what they themselves believe are the most qualified buyers in the market before exposing it to the second tier buyers?!?!?!?

The fundamental, self-serving claim of the Top Agent Network is totally unproven: “Reaching the most professional agents with the most motivated, realistic and qualified buyers often results in a higher price and smoother sale for the seller.” I’d like to see their data on that.
OffMLS actually made one good point that their service is open to all brokers, unlike Top Agent Network which is only open to the top 10% of agents. Of course, once again, if having more agents and more listings is a good thing then you might as well use the MLS, right? OffMLS’ points about growing rapidly, being client focused, and being locally grown in Chicago really didn’t seem pertinent to me.
In the current real estate market, with exceptionally low inventories and multiple offers commonplace, it makes absolutely no sense to restrict your buyer pool. If you have any doubt about the issues with these not on the MLS marketplaces then just go back to my blog post from January and read my interaction in the comments section with one of my readers. I think it’s clear that there is at least one seller out there that could have gotten a higher price for their home if they had listed it on the MLS.
#RealEstate #PocketListings #NotOnMLS
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