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What is a pocket listing?
Dear Phyllis,
I moved out of my home and rented it a year ago. My tenant will be leaving in six months, and I was planning on moving back. In the meantime, a Realtor I am acquainted with contacted me out of the blue to tell me I could get what I think is an unbelievable price for my home. I am well known in the community and would be embarrassed to list for such an ambitious price if I weren’t able to get it. He told me he could list my home as a pocket listing. What exactly is a pocket listing? And what are the pros and cons?
Jill
Dear Jill,
Although a pocket listing is technically a property listed for sale, it is not listed in the multiple listing service (MLS). There will not be ads in the newspaper, and there won’t be a “For Sale” sign either. Instead, your Realtor keeps your listing in his “pocket”. There are two ways for your real estate agent to go about this:
He can share it with only his clients, which will be a relatively small pool of buyers. This scenario may be more for his benefit than yours.
Or
Additionally, your agent can share the listing with a select group of trusted agents with whom he has strong professional relationships.
In today’s competitive market, you should carefully consider whether a pocket listing is the right strategy for your situation. If you are well-known in the community and value your privacy, a pocket listing can help keep your financial affairs out of the public eye. It may also spare you the embarrassment of publicly marketing your home at an ambitious price and not achieving a sale.
However, pocket listings come with significant drawbacks. Most importantly, you limit your home’s exposure when you do not place it in the Multiple Listing Service (MLS). Fewer buyers will see the property, which typically results in fewer showings. As a result, you reduce the likelihood of receiving multiple offers and creating a bidding war. Without broad market exposure, it also becomes much harder to determine the true market value of your home.
Ultimately, only you can decide whether the privacy a pocket listing provides outweighs the potential loss of sale proceeds.
Related Post: Realtor Lines of Communication
Not sure why anyone known or unknown in a community should be embarrassed about asking and wanting the highest possible price for the sale of their home. That’s the point.