More Pocket Scum

by Jim the Realtor | Oct 21, 2013 | Fraud, Pocket Listings | 5 comments

Realtors will put a twisted spin on any new gadget in order to justify hoarding commissions.  In this article, one manager convinces himself that because he gets ‘300 emails a day and four actually apply’, it’s good to use a separate system that enables pocket listings:

http://www.latimes.com/business/realestate/la-fi-lew-20131020,0,7268732.story

An excerpt:

That means agents no longer have to fool with emails selling Viagra, unwanted notices about office pools, and other non-work-related messages. That frees them up to spend more time listing houses, showing and selling properties, and attending closings. Agents found that the software allowed them to “preview” possible listings with their fellow agents and market them internally before they hit the open market.

That’s a form of so-called pocket listings, which are somewhat controversial in and of themselves.

With a pocket listing, a property for sale is held out of the local Multiple Listing Service while the seller’s agent shops it among his list of clients and friends. If the agent finds a buyer, he gets to keep the entire commission rather than share it with a buyer’s agent.

But while a house is in the agent’s pocket, so to speak, it is not exposed to the entire market, as it would be if it was on the MLS. And in theory at least, if the house was listed, the seller might have been able to secure a higher price.

Under the rules of most MLS systems, a property must be listed within 48 hours of receiving a signed listing agreement. So a true pocket listing is only a short-term ploy at best.

But the Yapmo software makes the process more efficient. Agents are able to automatically shop the property in-house directly to buyers and other agents who have expressed an interest in that kind of house, that price range or perhaps that area.

It isn’t intended to limit exposure to keep the deal in-house, Van Eck said. Rather, it is intended to maximize exposure during the “downtime” between when a listing is taken and the house is ready to show.

“Nothing in the MLS defines what people are looking for,” says Boehmig, the Atlanta broker. “But with this tool, a conversation can ensue while a house is getting ready to come on the market. Our agents can say, ‘I want to hear about that kind of stuff but not that kind of stuff.'”

Yapmo also works well for sellers who don’t know what their homes are worth, or for those who value their privacy and don’t want to tell the world that they are getting ready to put their properties on the market or what price they are asking.

“One of our agents just took a listing but was concerned about the price,” Boehmig says. “He was able to email other agents in the company saying, ‘Here’s what the seller is thinking. What do you think?’ And when the house actually came on the market, it was positioned properly to sell.”

They can dress it up all they want, but when they prominently mention that they have closed 275 pocket sales, you know their objective.  Realtors won’t police themselves – sellers need to insist on their home being placed on the open market!