Lately, some brokerage firms in Washington have been boasting to sellers about how they are holding “private exclusive” and “private placement” listings. These are listings where the seller signs an agreement and elects not to go into the Multiple Listing Service (MLS) for exposure to the broader market. Sometimes, these agreements actually give the broker the exclusive right to bring a buyer – stopping other brokers from participating.
The proponents of “private” listings tell you the seller that they are doing you a favor, assuring your privacy, making sure only the most qualified buyers can get into your home. Restricting access to a property does not often do the seller a favor – it is a benefit to the broker who may get both sides of the commission by making sure nobody else has access. Marketing “private” listings under the guise of “exclusivity” often excludes potential buyers who might otherwise be interested in your home. The laws of supply and demand dictate that if you reduce the demand by making sure only a few people know about a listing, while you still have the exact same supply, you get less money.
Don’t get me wrong — there are certainly situations that warrant keeping a property out of the MLS. A seller who isn’t ready to move until she finds a new house might want to stay out of the computer so as not to run up days on market. A seller whose property is in particularly poor condition or with an unusual living situation may not want the exposure. By and large, though, more exposure gets you more money. The best way to sell a property in Washington is to price it correctly, present it attractively and make sure that EVERYBODY SEES IT. Multiple offers can cause an escalation in the sales price and even if not, can garner better terms for the seller.
That said, if you’ve signed a listing agreement that allows for MLS entry but you’re still preparing the property for market, there is nothing wrong with letting your agent make other agents in multiple firms aware of the upcoming listing — and even allow them to show it to motivated buyers who have a little imagination. I’ve sold many listings pre-market by creating hype — the buyers are afraid they will have to compete and so they will pay top dollar for a property they have fallen in love with. It is up to the seller to decide whether to go with the bird in hand or to see what’s in the bush. Sometimes taking a big profit pre-market makes sense; there’s nothing like a sure thing.
Don’t let an agent or broker tell you that he or his firm is the only one with a buyer for your property. It’s OK to sell pre-market, but make sure your agent is working the larger brokerage community for you if you do so. Trying to keep things “in-house” is a service to the broker, not to the seller, and it can hurt the seller’s bottom line. With so many opportunities to capitalize on smart Washington real estate investments this spring, place your trust in firms that want to expose you to the market.
Sammy Dweck with Evers & Co. Real Estate, Inc. is a licensed real estate agent specializing in townhouse, condo and co-op sales in the D.C. metro area. Reach him at Sammy@sammydweck.com or 202-716-0400.