Purchasing an off-market property, also known as a “pocket listing,” can be an attractive option for buyers looking to avoid the competition and stress of the traditional real estate market. Off-market properties are not listed on the multiple listing service (MLS) and are typically only available to a select group of potential buyers.
If you are interested in making an offer for an off-market property, here are some tips to consider:
Research the market: Before making an offer, it is important to have a good understanding of the local real estate market. This includes researching comparable properties in the area to get a sense of the current market value of the property.
Work with a real estate agent: Working with a real estate agent who has experience with off-market properties can be beneficial. Your agent can help you negotiate the price and terms of the offer and provide valuable insights into the property and the local market.
Make a competitive offer: Off-market properties may be in high demand, so it is important to make a competitive offer to increase the chances of your offer being accepted. This may involve offering a higher price or making a cash offer.
Be flexible: While it is important to have a clear idea of what you are willing to pay for the property, it may be helpful to be flexible in other areas such as closing dates or contingencies.
Communicate clearly: Clearly communicate your offer to the seller and their agent, including any contingencies or special requests. This can help avoid misunderstandings and speed up the negotiation process.
Overall, making an offer for an off-market property can be a competitive process, but by following these tips, you can increase your chances of success. It is important to do your research, work with a real estate agent, make a competitive offer, be flexible, and communicate clearly to increase your chances of having your offer accepted
Finding a home can be rather difficult, while you are struggling with the endless amounts of competition, dealing with the stiff sellers today, and higher mortgage rates. Even with the price drops, the market value of properties will only go up further, so you are in a battle of time especially because mortgage rates continue climbing by the minute.
The Local Records Office suggests that with the battle and the total number of homes for sale, making an offer for an off-market property can bring you a seller as long you have the higher potential of doing your homework. The Local Records Office specializes in property profile reports and helps homeowners by providing you with the deed on the potential property you are interested in.
Homes for Sale
As there are more than 75 million owner-occupied households in the U.S., according to the U.S. Census Bureau, only a fraction of those homes go up for sale. A report from the National Association of Realtors found that while the total of home sales increased in 2017 compared with the previous two years, the amount of inventory decreased – 1.46 million homes were on the market in December 2017, nearly 200,000 fewer homes since December 2019.
People are not willing to budge out of their beautiful off-market family home just to find themselves in a pickle, and searching for a home while dealing with the new tax plan, plus paying a much higher mortgage rate than their 30-year fixed mortgage rate.
It is no wonder why buyers have been putting off their hunt for a home in hopes to save up more or wait for properties to be listed.
And though it may seem counterintuitive to offer to buy a home that the owner is not trying to sell, though, in tight real estate markets such as this one, agents can often time find a lot of success when buyer clients reach out with an unsolicited offer.
While you seem ready to explore the house-hunting strategy, there are still things to keep in mind.
Real Estate Agent
Have a real estate agent by your side, as you run the risk of coming up against more obstacles when you do not have a professional involved. Also, the homeowner may not take you seriously when you try to wade through a deal with no professional help.
And on the opposite side, you also want to expect the seller to consider bringing his or her own agent for representation. As the seller may want to test the market before accepting your bid, which may delay your purchase process and potentially leave you in the midst of an unwanted bidding war. Though this also would mean the seller would need to go through a process of preparing the property for public viewing, a step the off-market deal would avoid.
Finding the right owner –offering to an owner who may have previously listed their home and then took it off the market before it was sold.
Airbnb vs. For Sale
Harris recommends taking a close look at properties with absentee owners who rent out the properties to tenants. Look at listings online for rentals with Airbnb, or “For Rent” signs out front, or simply hear about it with conversations of people who live in the neighborhood. Owners who currently use their home as an investment are more likely to consider an offer to purchase than someone who still has sentimental value on their property.
Harris says, “every single Airbnb rental, in my opinion, could be a potential letter to that homeowner.”
Realistic offers are more “…realistic in value,” Northrop says. “Why would the seller sell it, if they’re not on the market, for anything less than what it’s worth?”
Writing a letter of why you want the property reveals that you are showing them a deal worth it in the long run, and in every letter, you compose, be sure to explain why the house is a good fit for you.
Harris advises against trying to approach the homeowner in person first since people tend to view strangers knocking on their door warily, and plus some cities have made it illegal for agents to go door to door for business.