There are times when a property is sold off the market, meaning it isn’t on the Multiple Listing Service (MLS). Sometimes a property is off the market for a period before an agent is going to list a property, offering it within its network. Other times a property is intentionally kept off the market in NC. There are benefits to doing this for certain properties, buyers and sellers.
Buying A House off of the MLS
High-profile sellers might keep a property off the MLS to prevent a stream of gawkers who want to see the house out of curiosity not with a real ability or intent to buy. While this might seem like something that only benefits the seller, a private transaction benefits buyers too.
Buyers have the confidence knowing they are already vetted prior to viewing the property and any viable offer will be seriously considered. There are usually fewer showings so sellers are motivated to consider the offers coming in as a true representation of the market conditions.
Investors don’t like to deal with a flooded market looking at a property, making offers that compete with theirs and often don’t get through escrow. As such, investors often go out of their way to find properties that haven’t hit the market. The types of property research help investors get an edge.
Investors look at probate properties, homes with tax liens on them or pre-foreclosure locations. This means the property owners are motivated to sell because of some time and financial need. Motivated sellers give investors or buyers a bigger advantage. There are fewer prospects to compete with and sellers need to make a decision in a timely fashion. This opens the door for a low-ball offer that is easier to negotiate.
Even though many off-the-market properties may start with a low-ball offer, it doesn’t mean negotiations are extended. Once a price is agreed upon, many investors are willing to forego extended inspection periods. This is a huge advantage to both parties. Sellers don’t have to worry about the nickel-and-dime tactics of most consumers during inspections. Buyers are able to accelerate timelines allowing them to get into a property faster to then fix it and flip it, taking advantage of positive market conditions before they change.
This is a particular advantage when a property is being sold is a slow market. Sellers may become concerned that a property will sit on the market for extended periods of time. Buyers can alleviate concerns for sellers by coming in, getting into escrow and accelerate timelines.
Saving and Making Money
Investors who are savvy at executing a real estate transaction might convince a seller than they don’t need an agent. This saves up to six percent on the transactions. Buyers are able to factor in the savings into the price while promising to be flexible on closing terms. A seller who needs more time in the home is often able to negotiate rent-back terms to stay a little longer. This gives the buyer an ability to make money while helping a seller finalize clearing out the property.
Buying a home that isn’t on the MLS isn’t reserved for investors and doesn’t mean you can’t have a real estate agent representing your interests. Remember that the real estate agent serves as your fiduciary and is also a great resource to find properties that are not yet on the MLS.