Home sellers in Los Angeles are choosing more and more to not place their house on the open market for sale and instead promote it as a pocket listing or ‘Quiet Listing” (which I think sounds a bit classier than pocket listing). According to a recent Inman News article I was surprised to hear that pocket listing made up 26% of home sales in five Northern California counties in the first quarter of 2013, up from 15% in 2012.
Being that Los Angeles is the entertainment capital of the world with high profile industry professionals consistently fighting to guard their personal business, I would image the percentage of off market sales would be much higher. Among my colleagues we estimate that approximately 30% of Los Angeles luxury real estate, especially in the celebrity driven areas of the Hollywood Hills, Bird Streets, Sunset Strip, Los Feliz and Beverly Hills, is sold quietly.
There can be advantages and disadvantages in selling your house off market. The disadvantage is you have less exposure meaning few buyers know about the availability of your house. If there are less buyers competing for your house then there is less competition and the selling price will not be driven as high. On the flip side, there are buyers who will pay a premium to keep the house off market and avoid a bidding war.
For a buyer to pay above market value the house typically has to be in an A+ area or have a special amenity such as Laurel Canyons’ highly rated Wonderland Elementary School and Studio City’s Carpenter Elementary School or the panoramic city views the Bird Streets or Beverly Hills’ Trousdale Estates has to offer. Everyone coming to Los Angeles is view crazy and will pay outrageous prices for a view, but that is a conversation for another article.
Besides the obvious privacy benefits and the possibility of a buyer paying over market to exclude other buyers, the advantages of an off market sale can include paying lower broker fees if the listing agent brings their own buyer which in many cases they do, wasting less time by only allowing qualified buyers into your house and being able to price-test the market to determine the actual market value.
Please contact me if you would like to learn more about selling your Los Angeles house off market and/or identifying an off market house to purchase.