Once solely the province of high end and celebrity markets like the San Francisco Bay area, Beverly Hills and Malibu, pocket listings now are increasingly popular in lower brow parts of the Chicago market, according to local RE/MAX broker/owners.
The broker/owners of RE/MAX offices in Chicago, Buffalo Grove, Rockford and Belvidere, Ill. report an upswing in requests from clients for pocket listings, with more such requests in 2013 than in the prior two years. Pocket listings are home for sale that are not listing on local MLS systems. To request a pocket listing, owners must sign a form stating that they don’t want their homes to appear on the MLS.
Mark Zipperer, broker/owner with RE/MAX Edge in Chicago’s Lake View area, is seeing even more pocket listings today than during the real estate boom years of 2004, 2005 and 2006.
“As an agent for listing clients, I’m not a big fan of them,” Zipperer said. “Sometimes a pocket listing will sell quickly, but that is not always a good thing. It can mean the house sold for a lower price than it might have commanded had the listing been on the MLS. The more buyers you have pursuing a property, the higher the eventual sales price is likely to be.”
Often, the broker trying to sell a pocket listing will promote the property to agents working in the same brokerage. With luck, that can lead to a quick sale, and Zipperer acknowledged that there are times when pocket listings are appropriate. Some sellers are more concerned about moving their home with a minimum of fuss than they are with landing the highest possible sales price. In such a case, a pocket listing can be the right approach.
The major downside to pocket listings, according to Tom Humpal, broker/owner of RE/MAX Property Source in Rockford and Belvidere, is that they don’t expose properties to the greatest number of buyers possible.
“Personally, I rarely think pocket listings are a good idea,” Humpal said. “They can make sense for home sellers in sensitive positions. An example would be someone in law enforcement, such as police chiefs or judges or detectives, people who don’t want their homes listed for everyone to see. In those cases, pocket listings can be a good idea. In the vast majority of cases they’re not.”
Andee Hausman, broker/owner of RE/MAX Experts in Buffalo Grove, often sees pocket listings “when owners want to get their home on the market but haven’t had time to prepare the property fully, so they won’t want it on the MLS yet. These listings occasionally will sell before they go public. Usually, though, a sale doesn’t happen until the home goes on the MLS.
“That is when sellers get the full benefit of the exposure that the MLS offers, which their broker can utilize to market the home through a variety of channels. 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.”