Pocket listings, the truth?

NorthlutMarch 3, 2012

We have a great real estate agent, but we gave him a day off today and looked at a few open houses on our own. The agents in the open houses were of course hungry for clients but we were clear with them that we already have an agent we were happy with. Several of them claim to have "a lot" of pocket listings in the area, saying something along the lines of "the seller doesn't want to pay two commissions."

What's the real skinny here? Is there really no way to get access to those houses without having the listing agent as your buyers agent? If so it seems like this is a no win situation, because not only are you stuck with dual agency but there would be no way to have access to all of them because any given agent can only show you theirs.

We're not going to switch agents, but we want to know that we're getting access to as much inventory as possible. What should we do?

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cmarlin20

In my area it can work both ways. If you want to use your existing buyers agent, have him call the other agent to see if there really is a pocket listing. Some say that to entice you, but you already know that.
Some agents do have pocket listings and put out the word to other agents and will work with them. You have no way of knowing unless you pursue each one.
It is difficult to have access to all houses because of individual relationships within any given area.
Personally, I work with dual agency so it isn't a no win for me, but I know, many don't want to do it.

    Bookmark   March 4, 2012 at 12:11PM
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c9pilot

This doesn't make sense to me. The seller pays one commission. The brokers cooperate to share it. Unless there is some odd agreement here, the agent is basically saying that he/she doesn't want to share.
Around here, a pocket listing means that the agent knows people who are willing to sell, but don't want their home on the market. It's up to the agent to find someone who wants a house in that neighborhood, at that price range, with that type floor plan or features.
The house we bought was a pocket listing. Our agent took us to a few neighborhoods and several showings until we had decided this neighborhood and she had a pretty good idea of what we liked and didn't like, then she said, well, this house isn't listed but the owners want to sell so let me arrange a showing and that was it.
She accepted a reduced commission because she didn't have to list or market the home or negotiate.

    Bookmark   March 4, 2012 at 3:21PM
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ncrealestateguy

Most of the pocket listings I have ever run into as an agent were from other agents word of mouth, and therefore the sellers were ok with paying both sides.
The biggest problem with pocket listing sellers, especially those that only want to pay one side is that not only are they looking to get a deal on finding a buyer, but you can bet that they are not too motivated either.
Next time an agent tells you that they have a pocket listing and you already have an agent, tell them to get with the seller on the phone right then, and let the sellers know that you are an interested buyer, and ask them if they are willing to pay a buyer's agent.

    Bookmark   March 4, 2012 at 6:34PM
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live_wire_oak

They are a waste of time. Most "sellers" who do pocket listings are pretty unrealistic about the actual market price of their home, and think that it's worth a lot more than it should be and are just waiting on some starry eyed noob to fall out of the sky and fall in love with their house and insist on buying it at that unrealistic price. Add that to the fact that they aren't really motivated to sell unless their mental zillion dollar figure is met, and they are a PIA to be avoided for a serious buyer. Not all are like this, but you can bet 90% are.

    Bookmark   March 5, 2012 at 1:58PM
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sylviatexas1

"Hungry" or not, Realtors can't try to lure a client away from another Realtor:
it's a violation of the Code of Ethics.

If they do indeed have "pocket" listings, your Realtor can help you with them.

Your buyer's rep will try to get the other agent's broker to sign an agreement that the "listing" broker will pay your buyer's broker.

If the other broker won't do that, your agent can still handle a purchase of one of these properties;
you can pay your Realtor fee at closing, or you can ask the seller to pay your broker's fee in the contract or in an addendum.

I wish you the best.

    Bookmark   March 5, 2012 at 2:50PM
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calliope

I don't understand why a seller would want an agent to do a 'pocket' listing on a house they want to sell. It's a term I'm not familiar with in this area other than the deal like C9pilot stated, not on the market but will work with a realtor if they find the right party.

    Bookmark   March 9, 2012 at 9:05PM
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