What Is A "Pocket" Or "Off-Market Listing"?

Hi, Dave.

Great columns. I always learn a lot. Can you explain exactly what "pocket" or "off-market listings" are, how they work, and how a buyer can tap into that segment of the market?

Thanks.

Bill F., Grand Junction

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Bill F,

The under used, but often successful "pocket listing"! One of my favorites! A pocket listing can be a sellers best friend and is something that we certainly use an awful lot each year. In fact, we will sell a dozen properties each year by utilizing the “pocket listing” status. A pocket listing is a listing that is not advertised and may be withheld from the multiple listing service until such time you are ready to go public with the sale of your home. With a pocket listing your listing agent can promote it to their peers and colleagues and will typically do so through word of mouth. If you go this route, you always run the risk of word getting out, but your chances of keeping it quiet are exponentially greater. A pocket listing can be a successful way to flying under the radar and still getting your home sold in a timely fashion and getting a jump start on selling before you are ready to put the sign in the front yard. If you go this route, I would suggest you be prepared to move as the results are often times quite good. 

The pocket listing is a great way to get your property exposure on the “down low” and buyers are generally excited to see these properties as they feel like they are getting a sneak peak at it before everyone gets a chance.  It’s a great option for those who dread the showing process or don’t want the hassle of showing after showing for several weeks. The traffic flow is often sporadic at best, but using this method allows you to hunt and peck for candidates that are most often much more targeted and many times pre-screened to help increase the chances they are a fit!  Keep in mind that a pocket listing may not always be the best option.

The pocket listing process does not provide the best environment for competition and multiple offers as the selectivity of who knows or has access can limit the big rush that many times occurs when a new property hits the market. This means that getting multiple competing offers that may drive the price up above the listing price is not common but getting an offer at the list price is a likely outcome because you can leverage the early access angle. Access to these properties is often times just being in the right place at the right time!  Many buyers are often frustrated when they see a house has sold before it even hit the market and feel cheated that they did not get a chance to view it.  One way we help our buyers get access to the ‘off, but on market’ properties is networking with other agents and e-blasting (email blast) to all the agents about what kind of property we are seeking! It’s amazing how many properties turn up when we e-blast for a buyer’s need if properties on the market at that time don’t fill the bill. 

I would encourage you to hook up with a real estate agent and have them start networking and e-blasting your specific property needs and see what turns up after doing so. You have to turn over every stone and sometimes turn them over time and time again to find just the right place! It does not always happen, but it sure can be an effective way to discover special/unique properties that are ready for sale, but just not in plain sight! Looking off the beaten path is sometimes where the best trails are forged! Looking in ways and places not everyone is looking is sometimes where real gems are found. Have a wonderful Sunday and thanks for your question.

Dave Kimbrough

The Kimbrough Team

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How Do We Find The “Best” Realtor To Help Us In A New Location?

Dave,

We will be moving out of state, to a city where we know absolutely no one.  How do we go about finding the “best” Realtor to help us in our new location?

Thanks,

Andrew - Grand Junction

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Andrew,

Great question. There are several ways to go about finding an agent in the city where you are moving. First, if you need to sell your home here, you can ask you real estate agent to refer you to an agent in their network with their company. This typically works great, because your local agent will do their due diligence to make sure the agent in your new city is experience, professional and knows the ins and outs of your new market.  

You can also get on line and look for homes in the area and take note of names that you see over and over.  Those agents, are probably well known and well connected and have a good base of knowledge of the local market.  Be careful to just take the recommendations of “find an agent websites”, because many times the agents that are referred off these sites are not producers, they are paying the web sites a referral fee for buyer referrals, It may have nothing to do with ability, knowledge or results, but who is paying for the website for the referral. Your best bet is to find a local agent here that has connections and can find you a qualified agent in your new city!! Best of luck, I hope this helps.

Dave Kimbrough

The Kimbrough Team

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Can We Require Our Listing Agent To Inspect Our House After Each Showing?

Hi Dave,

This may sound like someone just complaining but it actually is more serious than that. Our home has been listed with a reputable firm for four months. Whether or not our house has sold by mid‑July, we will be relocating to Denver to start new jobs. The concern we have is that after leaving the house during a showing, we frequently come back to find a door unlocked, lights left on and occasionally our bathroom used. With us no longer in town, can we require our listing agent to inspect our house after each showing? Unfortunately, we do not have a relative or a friend nearby that we feel comfortable asking to oversee, or burdening them with our property. This issue is concerning now but was even more so when our house was being shown during winter with freezing conditions. How do you deal with these problems?

Thank you, 

Gayle and Tom, Grand Junction

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Gayle and Tom,

This is a common problem and a very real concern as it is too often for our sellers that they come home after a showing and find exactly what you describe.  The simple answer is sell your home, but I, as much as anyone I know, fully appreciate that sometimes it is easier said than done. 

First, I must point out that from time to time all showing agents make mistakes and overlook details like locking doors and turning off lights after they leave for a showing. I will admit that one time, as careful as I try to be when showing a house, we went in through the front door and out through the back door and I forgot to lock the front door and actually left the key in the front door lock!! Luckily the showing agent was extremely forgiving and showed me quite a bit of grace, but as good as my intentions were that day, I failed to show the attention to detail and respect for the seller’s home that I should have. My point is, it happens to the best of us, but will not happen to me again! Should it happen, no, but does it happen more often than it should, yes.  That being said you have hit on a couple of points that could help alleviate your concerns.

It is very reasonable to request your agent check up on the house after showings. This may be difficult for your agent to manage, depending on how busy he/she is and the frequency of showings. If you are getting 3-4 showings a week, this can be more difficult, but if it is 1-2, then becomes a much more manageable. Most agents want to make the selling experience as trouble free for their sellers as possible and thus are typically very quick to accommodate their seller’s needs, if at all possible. Do not be afraid to ask your agent for their help, that is what they are there for. 

You have options, explore them. First and foremost, ask you agent and his/her company to help you solve the problem and alleviate your concerns, as I am sure you will find them very resourceful and helpful in finding a solution you are comfortable with.

 You mentioned, you did not have any friends or family nearby that you felt comfortable asking for help, but I would consider a reassessment of your friends and family and re-think who might be able / willing to help. I understand you may not have close neighbors, but any neighbor or friend who has kids (teenagers) who would like to pick a few extra bucks each week for checking in on your house, may be just the ticket. As I recall, teenagers are eager to earn a few extra bucks, but I must admit there may be a generational gap between then and now. : ) Young people today do not seem as money motivated as I was when I was younger! You might even check around at church, as many times the youth group, etc... have folks who are looking for odd jobs and extra sources of income. As I have mentioned in this column before, you may see this as a burden to your friends or family, but believe it or not there are many people who love to help. There are also two types of house sitters, those who would live there while you are gone and watch over the property and those who you can hire to come out once or twice a week to check things over. 

You have options, explore them. First and foremost, ask you agent and his/her company to help you solve the problem and alleviate your concerns, as I am sure you will find them very resourceful and helpful in finding a solution you are comfortable with. Here’s to praying for a worry free move and your home selling soon!

Dave Kimbrough
The Kimbrough Team

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Should we use an agent even if he didn't show us the house we plan to purchase?

Dave,

We’ve been on the hunt for a new house! We’ve used an agent to look at four houses so far, but last night we were driving through a neighborhood that we love and saw a great house that is currently for sale by owner. We called the phone number on the sign and they happened to be home. We took a tour of the house and had a great time talking with the owner about all of the house’s character and history. To make a long story short, my husband and I went home and after a lot of discussion we think this house is the one! Do we need to use the agent that showed us houses before to make an offer on the house? We don’t really feel attached to him, he did not find us the house and we think we can navigate the process from here on our own. Any advice?

Thank you!
Becky, Fruita

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Becky,

Ugh…Why this question? You are cruel and must love the thought of seeing people squirm! I can think of few questions I would rather avoid than this one.  The reason I would choose to avoid this question is that the answer may not sit well with my peers, potentially even those on my own team! First, if you signed an agency agreement, you are likely bound to this agreement and kicking him to the curb may prove difficult. However, if you did not sign an agreement, then the decision is fully in your court. This answer boils down to has your agent earned the right to work with you? Regardless of who found the home or if it is in the MLS or FSBO (For Sale by Owner), has he earned the right to work with you?

By earning the right, I am not just referencing the act of showing you homes.   Showing homes is truly one of the easier and more enjoyable parts of a Realtor’s job. I will start by pointing out that showing a buyer houses is generally the product of many hours invested in trying to find you the perfect house. It often means taking calls on the weekends, during family picnics, in the evening or during baseball or soccer practices. Good Realtors, or even bad ones for that matter, are never truly “off” work and typically behind every showing there are countless unseen and often underappreciated hours of work trying to locate you the perfect property. I would be willing to bet, if you took a minute of honest reflection, you know if your agent has earned the privilege to work with you. If he has, stick with him and have him help you find a solution to your dilemma. Be honest with him and give him the opportunity to “earn” his keep. Our agents welcome the chance to earn their commission…we do not want, or expect, to be paid unless we have earned it and I believe most agents would agree with that position. 

“Give him the chance to negotiate a better price, or build his commission into the price of the home to help assist you and the FSBO in making the process go smoothly and avoid some of the legal pitfalls that can be encountered if everyone does not dot their I’s and cross their T’s.”

Give him the chance to negotiate a better price, or build his commission into the price of the home to help assist you and the FSBO in making the process go smoothly and avoid some of the legal pitfalls that can be encountered if everyone does not dot their I’s and cross their T’s. More often than not, we have found that FSBO’s welcome the help and guidance and are willing to work with a real estate agent who can provide value! Providing value is key in this discussion, because cost is an issue when there is an absence of value. If he has provided value thus far, give him the opportunity to continue doing so!

Listen, if he really has not “earned” the right, and you are not kicking him to the curb to simply justify or facilitate financial savings, then move on and purchase the home on your own and forego representation. My Grandfather told me long ago, “you will find out all you need to know about a person’s character when you dig into their wallet.” I am not sure a truer statement has ever been made. Don’t make the decision based on dollars and cents, make it based on his ability and track record of providing you value and service. Hope this helps, but I am confident a little soul searching will point you in the right direction.

Dave Kimbrough
The Kimbrough Team

Countless showings, but no offers? What you should do next...

Dave,

Our house has been on the market for what seems like ages! We would really like to sell it as soon as possible because the whole process is beginning to wear us out! We’ve had countless showings and even a few open houses. Why we don’t have any offers is a mystery to us. The house is in good condition and we think we are in a great location. Have you had houses in the past that just don’t seem to sell? Do you have any ideas on why we aren’t getting any offers? What can we do differently to ensure our home gets sold in the near future?

Judy and Bob, Grand Junction

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 Judy and Bob,

Fear not, you are not alone! Yes, I have had houses that just would not sell and believe me, there is no magic bullet or secret sauce to end the frustration of the house that is a chronic non-seller! There are times when, even if you reduce the price to a below market value buyers still find them unsavory and not offer worthy. I have heard it said in the medical field that the disease with no diagnosis and no known cure is always the hardest one to treat! The same is true in real estate, but ultimately in real estate there is always an answer! Keep the faith, because unless you have one of the chosen few that just stubbornly refuse to sell, I am going to be able to give you some idea of where to look and adjust to get your desired result.

I tell people all the time, I am not the sharpest knife in the drawer and I am living proof you don’t have to be a rocket scientist to be successful at selling homes. The process, when boiled down to the basics, is really quite simple regardless of how complicated people choose to make it.  You want to be on target with the three things you can control, Price, Condition and Marketing. It sounds like your agent is doing their job effectively from a marketing perspective. You have had many showings and they have even held open houses to help generate traffic and attract buyers to your home, yet no offers. It also sounds like the condition is good. If you have not received feedback that indicates that you need to make some changes to the condition in order to entice buyers, then it is likely that you are in good. Now what we have left is price. Price is always the most difficult subject to tackle for any agent or any seller!

“Where price is concerned there are a couple ways to attack it. You will either be willing to listen to the market and adjust the price accordingly or you will choose to set it and forget it and wait till you find the right butt for the saddle. ”

Where price is concerned there are a couple ways to attack it. You will either be willing to listen to the market and adjust the price accordingly or you will choose to set it and forget it and wait till you find the right butt for the saddle. There are cases that can be made for both approaches. First, statistically speaking, you should have had an offer within 12 showings (on average) all else being equal. If “countless” showings means in excess of 12 then you really need to start considering a reconsideration of your pricing strategy. If you are nearing or over 18 showings it is likely time for action. I have heard sellers say this countless times, “all the feedback indicates that the price is ok, nobody is objecting to our price so it must be something else. If the buyer is interested they will surely make an offer.” I can tell you, this is faulty (but VERY common) logic. No offers and no or few second showings means they are objecting to your price by purchasing something they perceive is a better value at a similar price. Believe me, if a buyer smells value they will pounce! The “real” feedback you need to listen to is the lack of offers…sometimes that silence provides truth.  If you decide to wait long enough one of two things will happen, the market will catch you (assuming the market is going up) or you will find the perfect butt for your seat! I have seen both methods be successful, one just typically takes a lot longer than the other and is ultimately more frustrating.

To move the process along at a faster pace, be willing to adjust your price until you get the desired result. The good news is you have had a lot of showings so you probably are not way off, probably a 3-5% adjustment will do the trick! Talk to your agent and get their input on a proper price adjustment. I would bet your desired outcome is closer than it feels! Hang in there and Best of luck. I hope this helps.

Dave Kimbrough
The Kimbrough Team

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