There has been a lot of talk over the past year or two about “off-market” listings. This is referring to homes for sale, but not listed on the MLS (multiple listing service), and therefore not listed on the various internet real estate sites. This has become a more popular topic as Buyers are finding it harder to compete against multiple offers and are hoping that they would have a better chance if fewer people knew about the listing.
Of course that is exactly what most Listing Agents will tell their Sellers. Only that they want as many offers as possible so the buyers will bid-up the price to the highest price the market will bear. Sellers should put their homes on the MLS and promote it as much as possible. However there are circumstances where an off-market listing is in the best interest of the Seller and an opportunity for Buyers “in-the-know”. (I personally bought and sold my own home this year, both off-market).
Our local MLS service has been tracking the percent of homes sold “off-market” in the five county area that it serves from San Mateo to Santa Cruz counties. Their analysis is that up to 20% of homes are sold off-market (11.8% in 2011, 14.5% in 2012, 20.7% in 2013, and 16.4% YTD 2014). Of course, this may or may not be what you see in the specific market you are interested in.
So what is the answer in Los Altos? The short answer is that around 95% of Los Altos homes are listed on the MLS, 2% are sold by Realtors off-market and posted on MLS after the sale, and 3% are never posted on the MLS.
To give you more of a feel, here are the specific numbers as of Dec 15th for 2014:
– Homes listed for sale on the MLS = 279
– Homes sold by Realtors and posted on MLS after the sale = 6
– Homes sold and not posted on MLS (assume by owner) = 10
The sell and purchase of my personal homes represented 2 of the 6 homes sold by Realtors and posted after the sale.
A couple of key conclusions for Buyers:
1. The MLS is a very strong reference base for assessing market values and finding comparable homes with 97% of home sales being reported on the MLS.
2. There are very few “off-market” homes for sale (16 out of nearly 300 per year). Certainly worth having your Realtor work their network to keep an ear out for off-market listings and to get a jump on upcoming listings, but not a silver-bullet.
3. There is a small hand-full (~10/year) that are sold directly by the owners. About 1/3 are new construction homes that most Realtors hear about. Maybe 1-2 post on the various For Sale by Owner (FSBO) internet sites. The rest; just happens.
1. The base-line answer is that you should market your home on the MLS in order to attract as many prospective Buyers and offers as possible. This is usually the best path to maximizing the value you receive for your home.
2. There is a way to market your home off-MLS. Realtors, especially ones in the major brokerages in Los Altos, have a very extensive network of Realtors that they can reach. I sold my personal home off-market by marketing it to agents in my brokerage, Alain Pinel, which happens to be the #1 brokerage in our area. It worked well in our case and the Buyer’s agent was not from my brokerage!
Hope you find this helpful. Feel free to email me with any questions or requests for additional information.