I’ve been getting lots of mail recently, from homeowners and agents alike, asking why I bother to post information about “pocket listings”, those properties that are for sale, but not in the MLS. Even agents as far away as New York and Toronto have contacted me on Twitter and Facebook, asking why we seem to have so many pocket listings in Santa Monica, Brentwood, Westwood, and Beverly Hills.
But most importantly, what do all of these private sales mean to you, and the value of your home, as a seller, or as a buyer, or even just as a spectator? What do you need to know about the Westside market now?
In a recent blog post, “Appraisals Compromised due to Lack of Comps“, I spoke about the fact that appraisers in the Westside market have been hamstrung in their price justifications due to the dearth of good comparable sales. This has led to some questionable tactics in assessing value, not just for purchase money, but for refinances as well.
The Westside of Los Angeles has had a steadily percolating undercurrent of sales throughout the last 6 months, most of which have not made it into the MLS, a prime resource for appraisers and agents alike. If one is unaware of those private sales, they are missing vital information about the real complexion of the market now.
One interesting factor is the perception that “nothing is selling”, when in fact, quite a few homes sell each week through private sale. However, those properties will never have a sign, will never be advertised online or in the paper, so the general public may never know. There is more activity in the market than you may know. For you homeowners, this is a positive sign, and for you buyers, well, a change may be coming!
As a home buyer, you will want the opportunity to look at all properties on the market. You don’t want to be limited to re-sales, REO’s , or short sales. In fact, some of the best properties never see the general market. You must select a Realtor who knows intimately the specific areas you are looking for, and has access to those pocket listings. Regardless of what property you buy, you should have an accurate sense of the true value of the market and neighborhood, and knowing all of the sales s the only way to accomplish this.
As a homeowner, you must have this information to accurately assess your home’s value in this admittedly turbulent market. This is doubly true if you need to refinance your home, and your appraiser has no access to this hidden information. Before you select a mortgage broker, lender, or appraiser, as how they are tracking “pocket listings” and private sales. If you are about to put your home on the market, be sure the Realtor you choose has a good network that allows them to get access to this information. Ask the question up front, because the answer can be worth real dollars to you in the end.