It’s been widely accepted for years that off-market sales are part of the real estate landscape. After the (fraudulent) short sales went away, realtors needed another sexy lure to attract new clients, and rather than crafting the high demand and bidding wars into an auction-like experience, we went the other way and are using restricted access as our ploy.
None of the industry players want to even talk about it, let alone do anything.
In the meantime, it’s the way the business is trending.
With no public objections and so many off-market deals happening right before our eyes, every agent and brokerage wants to take advantage and create an effective off-market strategy.
It restores control of the inventory to the agents – we decide who gets exposed to the listings, and when. It will also turn the MLS into the website of last resort, used only when a listing agent can’t find their own buyer. The real estate portals will suffer, and full access for consumers won’t be the same.
We might as well go back to the MLS books!
Many agents claim it’s just ‘pre-marketing’, but what happens if a buyer makes an offer before the listing hits the open market? Are you going to turn it down? Or are you going to make a quick deal and move on to the next one?
The phase underway now is the building of realtor clubs.
There’s the PLS, as well as the Top Agent Network, which is operating in 31 markets and should be coming to San Diego soon. They offer club membership to the top 10% of producing agents in each region so they can network and market their listings to each other. I’m also a member of 4-5 groups on Facebook, where the focus is pre-MLS exposure of listings and ‘making deals’, plus there are several realtor meet-ups around town too.
The shift to private, off-market deal-making isn’t just coming soon – it’s here.
I think we should just admit it to ourselves and to the consumers, and then find a way to make the best of it – because it’s not going away.
> It restores control of the inventory to the agents – we decide who gets exposed to the listings, and when.
I can foresee a huge liability. Imagine the legal headache if after a few years of agent controlled access the agent gets accused of discrimination.
How about anti-trust? Deliberately discouraging or preventing business between competitors is illegal.
But the commercial brokers have always functioned this way, so whatever goes.
What I see as a problem is the fact damages are not significant enough if a consumer wants to sue an agent for breaching their fiduciary duty to the seller or buyer. The real estate industry needs to face real consequences for playing fast and loose with the transactions.
Amount of damages is very hard to determine as well.
Wouldn’t you have to be brain dead as a seller to sell “off market”? It seems logical to me that the larger the number of prospective buyers a property is exposed to translates into the larger the amount of money the seller will receive.
That is where you come in Jim, if you want to piss off a bunch of agents.
That is where you come in Jim, if you want to piss off a bunch of agents.
I used to fight this, whine about it being wrong, etc. but it didn’t do any good. I’m in full surrender now.
Agents believe that Coming Soon and off-market deals are good – mostly because they see so many of them happening everywhere around them. How can it be wrong, if everybody is doing it?
Then we get into the justifications; like preserving the seller’s privacy, we got the seller’s price, sellers didn’t want to be bothered with showings, etc. and it all starts to sound legit.
Long forgotten is the agreement every agent signed about sharing their listings with the fellow agents.
If we can justify in our head that we didn’t harm the seller, and don’t care about our fellow agents and how this business has thrived since the MLS started 60 years ago, then screw it. Every man for himself, and dog-eat-dog.
It’s going that way just out of survival.
The big money flowing into the industry is commoditizing the business into production-based transaction processing – how many deals can you close, and how much money can you make off these folks.
Good acting? Lot of famous people here.
The sad part is how many other agents, and managers, see this going on, and look the other way.
It may be sad that I’ve given up the fight, but I need to adapt to the market. There is no valor in being right, talking about it for years, and still make no difference whatsoever.
This negates open market theory and basically is a monopoly.
In a more general sense the term has started to be used in economics and political economy, in which an open market refers to a market which is accessible to all economic actors. In an open market so defined, all economic actors have an equal opportunity of entry in that market. This contrasts with a market closed by a monopoly which dominate an industry, and with a protected market in which entry is conditional on certain financial and legal requirements or which is subject to tariff barriers, taxes, levies or state subsidies which effectively prevent some economic actors from participating in them (see protectionism
Yes, a very nice way to push the in-house deal. You want access to my private listings, you have to buy through me. Don’t worry I’m looking out for both you and the seller. You don’t need your own agent. True double-dip, insider trading, in-house deal. Nothing wrong with that.
basically is a monopoly
We’re like the stock market.
People can use discount brokers and get things done, but it’s from a limited subset. You want the whole enchilada, you gotta play with one of the big boys.
Nothing wrong with that.
Tom is the first known agent to comment, thanks Tom.
But you are a buyer-agent only in Massachusetts right? So your last line has some sarcasm to it?
Restraint of Trade
Breach of Fiduciary Duty
Breach of Contract
Did I miss any?
Breach of contractual obligations to share listings with other agents.
But when CAR provides the form for listing agents to exclude listings from the MLS, not sure where the blame falls.
Moral Compass? Should start wearing “members only” jackets again. How does an exclusive club of agents and a few wealthy buyers determine market prices for residential real estate? Open markets determine fair prices.
Why have commercial property sellers for so long been willing to have their property sold off market rather than listing it to the open market? For a buyer I understand the appeal but for a seller, why do they not insist on placing the property on the open market?
Why have commercial property sellers for so long been willing to have their property sold off market rather than listing it to the open market?
They don’t know that all the big commercial brokers don’t use any MLS, and Loopnet is just for the over-priced leftovers.
Here’s the commercial pitch:
Over the years we have built a database of all the investors (residential agents will substitute ‘buyers’ here) in the western hemisphere, and we will market your property to them instantly.
Our global marketing reaches buyers and agents everywhere.
We produce these shiny 4-color brochures to highlight and magnify the benefits of your property.
We will tour your property personally with each prospective purchaser.
In short, your property will receive the best coverage known to man, and we’ll be in escrow lickety-split!
“Our lives begin to end the day we become silent about things that matter.”
Martin Luther King, Jr.
His dream was hijacked long ago.