What Happens Off Market, Stays Off Market
M.Y.O.B.
Moving on from your home is a personal affair, and selling can turn it into a very public one. Suddenly, the house, its attributes, along with its inhabitants, are subjects of conversation. Appraisals are taken by the neighbors, who judge the list price against their opinions of value, and against their own home.
Do you dread the strangers who arrive on Sundays and leave fingerprints on your kitchen island, or poke their noses into your closets? I understand the hesitation you may feel. Thankfully, there is an elegant alternative to this experience if you’re working with an experienced broker: selling off-market.
The Exclusive
There might be a multitude of reasons for a seller to choose an off-market sale. Neighborhood gossip aside, there is often good cause for discretion, privacy, and, in many cases, a brisk and efficient sale. A knowledgeable real estate agent knows how, and to whom, to market an exclusive.
Moreover, buyers welcome the ease with which an offer can proceed to closing without the hassle of an open marketplace. Off-market listings give buyers alternatives to what is already on the market, providing additional inventory through well-connected brokers. In competitive markets like Greenwich, off-markets might be the only inventory available. Buyers working with brand new agents, or forgoing an agent at all, likely will miss out on what could be their dream home.
These types of “private” sales work to eliminate some of the uncertainty and bring a more considered approach to selling a property. A veteran real estate broker will use their private network to find potential buyers, without a photo of their bedroom ever hitting the internet.
In the Pocket
You may recall my last column on the extensive work that goes into preparing a home for sale in the open market. I outlined the days and weeks that are required prior to listing. While some sellers move-out prior to listing, many homeowners continue living in the home until an offer is accepted. Keeping a home in ready-to-show condition is stressful and the uncertainty of time-on-the-market can be worrisome.
Though there is a mystique surrounding the idea of off-market, it remains a straightforward way of selling a property. Also known as a “pocket listing” the home will not be listed on multiple-listing services, the website through which all real estate agents (and many aggregators like Zillow) have access to a property’s details.
By remaining in the agent’s “pocket,” it is up to the seller’s broker to find potential buyers, (though the majority of these deals have agents on both sides). This can be useful to see if a home is well-priced, or if some adjustments are needed. Further, off-market listings have no days-on-the-market, which can negatively influence buyers if a house lingers for several weeks, or even months. In fact, it is often a useful tool for agents to test the market’s tolerance for an optimistic asking price with a private listing. If the initial introduction is not successful, the property can then go on to be listed in the traditional manner at an adjusted price.
Once the papers are signed and the keys exchanged, the new owner quietly moves-in. Of course neighborhood conversations will invariably start, with many expressing surprise that the home sold so discreetly and they will weigh in on their opinion of the close price. Those close to the previous owners will casually mention that it was sold off-market, further adding to the allure of the sale.
Holiday Sale
Take for example a gated, 3-acre oasis just 5 minutes to Greenwich Avenue. The previous owners, long time clients and friends, reached out to me at the very end of 2023 seeking to sell their gracious home discreetly. Knowing that they were out of town for the Christmas & New Year’s Holidays, we decided to prep the house and offer it as a private listing. The goal was to avoid racking up extensive DOM (Days on Market) during a traditionally slow time for real estate sales. I felt confident that I could find a buyer, if the price was right, and have the deal signed and wrapped up before they were off the slopes and headed back home.
We made the necessary arrangements to offer the property as a private sale, and within a week of reaching out to my network of clients and top agents from both Compass and other brokerages, quickly found a buyer. On New Year’s Eve, no less! The next two months ran relatively parallel to a traditional listing: inspections, bank and lawyer conversations, movers, etc. and then the sale was officially closed.
My clients were able to avoid publicity, capitalize on a very low inventory market at an otherwise “dead” time of year, and we were able to negotiate to get their asking price without the stress of open market bidding wars for either seller or buyer.
Now the REAL truth… going public ensures the best outcome!
I was chatting with a top Compass agent in next door Rye, NY who put it best: “someone loses in every one of these transactions.” Sometimes the seller leaves money on the table; sometimes the buyer overpays to avoid competition. Both parties might even be happy with the outcome, but true fair dollar value is only achieved when the property is broadly offered to the marketplace. The overwhelming majority of transactions involve a buyer’s agent, and most agents rely on the MLS to learn about homes for sale just as buyers do. Remember: a home sale is an auction every time, so the more bidders you are exposed to, the greater the odds that someone will raise their paddle!
Private sales remain a very, very small part of the housing marketplace, even in tony Greenwich, Connecticut. Real estate agents will continue to advise clients on the best methods of ensuring a successful sale, while maintaining privacy and professionalism.
Whether or not an off-market makes sense for a property is always up to a seller. By working with a licensed real estate broker, homeowners gain value that is directly translated into the sale, opening the property up to potential buyers they would not have otherwise reached. Conversely, partnering with an agent gives buyers an advisor by their side who will show them overlooked or non-listed properties.
Regardless of how a sale proceeds, the importance of working with a broker remains paramount to ensuring a deal on the best terms possible. Expertise and advisory services are essential to ensuring that a client’s goals are met. With ongoing changes to the marketplace, and the limited housing inventory available, making an informed real estate decision remains paramount. Retaining an excellent agent is a critical long-term investment.
