Apparently pocket listings, where a home is offered for sale by the homeowner but where the information is not made public on the local multiple listing services, are on the increase. The broker/owners of RE/MAX offices in Chicago, Buffalo Grove, Rockford and Belvedere, Illinois have reported an increase in the number of requests from clients for these types of listings, with more requests coming in last year than in the previous two years.
This confirms a trend that was noted last year in a story in the Chicago Tribune. It reported that 4.7% of all homes sold in Chicago in March last year were as a result of pocket listings. This is an increase of 2.6% compared to the same month a year earlier. In spite of this increasing trend, Tom Humpel, broker/owner of RE/MAX Property Source in Rockford and Belvedere has pointed out there is a major downsides to these types of listings as they fail to expose properties to the greatest number of buyers.
Humpel is quoted as saying “Personally, I rarely think pocket listings are a good idea. They can make sense for home sellers in sensitive positions. An example would be someone in law enforcement. In these cases, pocket listings can be a good idea. In the vast majority of cases they’re not.”
In the past pocket listings have been requested mainly by the very wealthy or by celebrities who are trying to sell million-dollar homes without attracting too much attention. Anyone wishing to request a pocket listing has to sign a form saying they don’t want their home to appear on the MLS.
Mark Zipperer is a broker owner with RE/MAX Edge in Chicago’s Lakeview area and is now seeing more pocket listings than during the boom years of 2004, 2005 and 2006. However he’s not a big fan and points out that even though a property might sell quickly it could sell for a lower price than it might commanded had the distinct beams on the MLS. He says “The more buyers you have pursuing a property, the higher the eventual sales price is likely to be.”
Brokers working to sell pocket listings often promote the property to other agents working in the same brokerage. Hopefully that will lead to a quick sale, and sometimes it is the right option. For example some sellers are more concerned about selling their home with minimal fuss rather than achieving the highest possible sales price. In this case a pocket listing can be the right option.
Sometimes properties will be pocket listings when an owner wants to get their home on the market but hasn’t yet had time to properly prepare the property, and as such doesn’t want to go on the MLS just yet.
Andee Hausman, broker/owner of RE/MAX Experts in Buffalo Grove often sees these types of listings, and sometimes they will sell before the listing goes public. Frequently the home won’t sell until it goes on the MLS. Hausman points out that “With so many of today’s buyers relying on the Internet for home searches, getting a listing on the MLS is more important than ever. You’ll rarely find a pocket listing when searching on the Internet.”