5 Min Read.
When a house is up for sale do you always assume it’s advertised online? With the massive influence of real estate websites like Domain.com and realestate.com.au, many people assume they can find any house online. The truth is that not every house up for sale gets publicly advertised. These houses are commonly referred to as off market listings.
Owners or vendors of a house usually turn to off market real estate to get a quick sale. In some cases, the property needs to be sold with special terms that prevent it from being publicly listed. While there’s no public advertising for off market listings, that doesn’t mean a real estate agent won’t actively seek out potential buyers.
‘Off market listings can provide some great opportunities for home buyers.’
A real estate agent will reach out directly to potential buyers. These people are often locals in the area that are from a database of past contacts. A real estate agent’s database is usually built up by collecting names from open house inspections. So if there’s anyone interested in buying in the local area, you can almost guarantee they’ll get contacted by the agent.
It’s also interesting to note that any house for sale is classified as off market real estate until it’s advertised on major portals like real estate websites. Any offers that come through for a house when it’s off market can also help inform owners and agents one what interest is like in the area.
Are there any benefits to choosing off market real estate?
Off market listings offer an incredible advantage to home buyers. With no online advertising, there’s likely to be less competition for the house. There’s no auction so there’s less chance of the sale price being bumped up.
When an agent reaches out to locals that doesn’t mean there will be a lot of interested buyers. In some cases, you might be the only buyer putting in an offer to buy the property. This scenario gives you the potential to buy a house well below what the open market would price it as.
One of the only clear advantages to selling with off market listings is how fast you can get a sale through. The quick sale of a property might also enable you to add special conditions such as shorter settlement periods and bigger deposits that are inclusive of any building faults.
Some vendors choose to organise a quick sale to pay off debts to a lender faster. In some cases, it’s simply a matter of the vendor deciding to relocate or move house in a hurry. Not everyone has the luxury of waiting months for a settlement date to arrive.
What are the disadvantages of choosing off market real estate?
When it comes to off market listings it really is more about who you know rather than what you know. It takes time to build up the right contacts and it’s not always easy to get a hold of local real estate agents.
You need to put in the time and effort for meeting with real estate agents in person to discuss your interests and exactly what you’re looking for in a property. Visiting open for inspections in the area is one of the best ways to build up those valuable insider relationships you’ll need.
Unfortunately, there’s a high chance you’ll get a lower than average sale price when you choose to do an off-market listing. Without online advertising, you lose access to a large pool of potential buyers who could easily bump up the price with a high number of offers coming through.
With no auction, you’re also missing out on the opportunity for bidders to jack up the selling price anywhere from an extra 10k to 100k. Look at past sales results in the area and see just how much difference there is between original listing prices and final offers.
How to find an off-market listing
One of the best ways to start finding off market listings is to contact local real estate agents. Get in touch with agents that specialise in the area you’re looking to buy property in. These agents can put you on their database and let you know when something that fits your criteria is available.
If none of these agents gets in touch with you then don’t be afraid to reach out. It can be hard for agents to stay on top of new listings and contact potential buyers. Try reaching out by email to send agents a little reminder that you’re still looking to buy in the area.
How do I organise an off market sale for my property?
If you’re looking to sell off market then it’s best to go with an experienced real estate professional. Look for trusted real estate agents in your local area. For a search like this, it’s best to make a shortlist of potential agents. Then start comparing their results when it comes to off market listings.
If you find it hard to find past sales results for off market listings then don’t be afraid to ask your local agents. Compare their sales results with others and look for houses that were similar to yours. A local agent may be really successful at selling off market units but the same might not be said for three to four-bedroom houses.
Your working relationship with a real estate agent should be no different from any other sale. There is still a lot of paperwork involved and you will need to sign an agent agreement. You will need to confirm details such as the duration of the agreement, the agent’s estimated selling price, advertised price, and settlement period. The commission and fees you agreed on should also be included.
Once the agreement has been signed, your real estate agent will start reaching out to potential buyers. Property inspections will be arranged for any interested buyers. If you want to impress your potential buyers then you can always style or stage your house to give it a more homely appeal.
During the inspection process, you may find a few interested buyers. These people interested in your property will make offers. If there’s an offer that’s appealing to you then it’s best to lock it down by getting the offer in writing. If you agree to the offer then it’s simply a matter of signing an agreement and getting the deposit paid for the house.
During the review process of written offers and contracts, it’s always best to get a property law expert to review everything before you sign on the dotted line. During this stage, you can enlist the services of a Property Lawyer or Conveyancer. Just remember a Conveyancer isn’t permitted to give you legal advice. Only a Property Lawyer is permitted to give you legal advice during a property transaction.
Your next move
Feel like you’re all clued up on off market real estate? Like any other purchase in real estate, we still recommend that you take your time and do as much research as you can. Don’t be afraid to get a second opinion on an off market listing you’re really keen on.
Don’t settle for just one real estate agent either. When it comes to looking for off market listings, it helps to have multiple real estate agents you have looking for you. The more help you get, the more likely it is you’ll find something that’s worth inspecting.