Selling Your House Off-Market: Is It Right for You?

Understand the Clear Cooperation Policy

In response to concern about the fairness of this practice, however, the National Association of Realtors® (NAR) implemented the MLS Clear Cooperation Policy in May 2020 that put an end to these secretive pocket listings to ensure that all potential buyers have fair access to listing information.

Specifically, the Clear Cooperation Policy requires agents marketing properties to the public to post a listing on the MLS within one business day. The term “marketing” is considered anything from posting an ad online to putting a sign in a yard.

“If we begin to show a listing, it has to be on the market within one day,” says Kim Pratt, working with over 67% more single-family homes than the average agent in Arlington, Texas. “We have to let the sellers know as well because the sellers can’t go around and market their property a week or two ahead of time.”

According to Pratt, agents have the opportunity to market a property as “coming soon” under this policy but are prohibited from showing it until it is posted on the MLS within the one-day period. She comments further that these rules deter listing agents and their partners from keeping listings away from other brokers and agents.

The end of pocket listings doesn’t mean the end of private listings

It may be the end of the pocket listing as we knew it, but agents can still market private listings as office exclusives in which agents can transfer information within their brokerage without needing to post it publicly on the MLS — but it must stay within the brokerage.

Pratt says she can market a property within the office that could be sold as a private listing to an investor or client within the brokerage, but it needs to stay in-house. “I couldn’t call my friend down the street with another brokerage and let her know [of the listing],” Pratt explains.

Finding qualified buyers for off-market sales

There are plenty of investors who are always looking for a good investment, so it’s possible to find investment companies and buyers when you know where to look.

Maximize office exclusives

It’s not difficult for a well-connected agent like Pratt, who has a strong network of investors, to find buyers for an off-market sale.

“We have a ton of investment companies. People call us all day long to get on that investment list because they want to be on the list of investors that get notified when properties are off-market.”

Although Pratt can inform agents inside the brokerage about properties, she’s not allowed to “blast it out to a list of investors,” she explains. “We can let sellers know we have investors; at that point, we can reach out to investment companies.”

Search iBuyers

iBuyers or instant buyers use technology and algorithms to buy real estate quickly. Some iBuyers have been known to make a cash offer in as little as 24 hours. Working with an iBuyer can take the hassle out of arranging showings, open houses, and staging homes for sale.

Consider selling to a house flipper

Flippers are real estate investors who purchase properties with the intention of renovating and reselling them for a profit. Some even turn their trade into popular television shows. These companies, however, often purchase houses from auctions and other off-market sources way below market value, which means flippers might not give the best offer.

Look for buy-and-hold investors

Buy-and-hold investors purchase real estate properties as a means to strengthen their portfolios. As the name suggests, these investors hold onto properties for an extended period. They build wealth by generating rental income and receiving tax incentives and benefits. It’s not uncommon for buy-and-hold investors to pull equity from one home to purchase another.

Get a cash offer with Simple Sale

HomeLight’s Simple Sale platform connects sellers with cash buyers and is a convenient way to bypass the conventional listing process. Sellers won’t need to pay agent fees, arrange showings, or worry about the hassles of repairs, inspections, and staging a home for sale. Best of all, sellers receive a competitive cash offer within 24 hours when using the platform.

Here are the three easy steps in the Simple Sale process:

Sell to friends and family

If you have a friend or family member interested in buying your home, you can sell it to them off-market. To save money, you might consider completing the sale without professionals but know that selling to a family member can be tricky and still come with complications related to contracts, fees, and repairs. Make sure to hire an attorney to handle the legal work and keep in mind that if you set your price below fair market value, there could be tax implications.

Find out what your home is worth

If you are considering selling a house off-market, it can be helpful to have an idea of what the value of your home might be. Using HomeLight’s Home Value Estimator tool and answering seven simple questions, you can learn the value of your home in just two minutes. Our home value estimator uses market trends, sales data, and your home’s last sales price to determine the value of your home.

Is selling a house off-market right for you?

Selling a house off-market comes with its pros and cons. An off-market sale gives sellers more privacy, discretion, and confidentiality. It also can allow home sellers to bypass inspections and repairs that can delay the closing during a traditional sale.

On the flip side, sellers won’t receive as much exposure for off-market listings. MLS listings can lead to a higher purchase price that comes from multiple offers in a hot market. However, a buyer might offer a higher sale price to keep a property off the market. Let’s examine if selling a house off-market fits your needs.

Three steps to a successful sale

Whether you’ve decided to sell your house off-market or publicly on the open market, the following three steps are essential elements for an efficient and successful sale.

Provide required disclosures

Most U.S. states require sellers to provide a disclosure statement to buyers. You need to inform the buyer of any broken or damaged items, as well as potential hazards, such as lead-based paint, mold issues, or asbestos. Know that if you fail to be transparent about these issues, you can end up being sued in court.

Ensure your property has a clear title

For a real estate property to change hands from a seller to a buyer, your property needs a clear title. A title search must be performed by a title company or an attorney to make sure the seller is the legal owner and that they don’t have any liens from creditors or legal claims on the property.

If you have a lien on your property, you can work the payment into the settlement of the sale at closing. Reach out to an attorney to learn your options.

Close the deal

The day of the closing has finally arrived. You and the buyer will sign documents, pay closing costs, and address escrow items. You’ll transfer ownership of the property to the buyer and provide the keys. In return, you’ll receive a cashier’s check or a wire transfer of fees to your bank. The deal is done.

Still unsure if selling your house off-market is the best option for your needs? Connect with a top real estate agent who can advise you based on your unique circumstances.

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