Real estate agents tend to use terms among ourselves so frequently we sometimes just assume the general public knows what we’re talking about. But that’s not always the case. One example is the term “pocket listing”.
A pocket listing is simply a property that’s under a signed listing agreement with an agent but is not listed on the MLS. Think of it as the listing agent is keeping the property “in their pocket”. They might market the property very widely and everywhere except the MLS (and it’s affiliated sites) or keep it confidential and only show it to selected buyers they’ve approved for the seller.
Why would a seller opt for a pocket listing rather than listing with the MLS, Realtor.com, Zillow, and all of the other syndicated sites? Here are two reasons …
- The seller may not quite be that motivated to sell, but they still want to test the market on a limited basis. They usually give the pocket listing to an agent with a strong presence in the area knowing other agents who also specialize in the area will find out about the property through normal networking channels.
- The seller might actually be ready to sell but doesn’t want to be bothered with lots of showings. They’re OK with fewer showings if they’re more meaningful. They don’t want to open up their home to the entire MLS which often leads to showings from unqualified or non-motivated buyers. The sellers rely on the listing agent to ferret out the real potential buyers for them before agreeing to a showing.
Quite often homes sell as pocket listings and never even hit the MLS. In fact, we recently sold a pocket listing in the $2 million range. The sellers weren’t sure they could get what they wanted out of their home and didn’t want to interrupt their lives with wasted showings. We thought their home would sell within their price parameters and convinced them to let us try the pocket listing route. After we built the web page on our site and introduced the home on Facebook, Twitter, LinkedIn, and all of our other marketing sources (except the MLS), the buyer quickly appeared and it closed very quickly without any problems.