In the incredibly competitive Redondo Beach real estate market many homes are not even making it to the local MLS. Some of these homes quietly get sold without the general public even knowing that they were for sale. So how do you find out about these homes? First it’s important to understand just what we’re talking about.
What does off market or a pocket listing mean?
It can actually mean a few different things but in general, when we refer to homes sold off market or pocket listings these are homes that are never put on the MLS and therefore unknown to most buyers and many realtors. That means that searching the Redfins and Zillows of the world may mean that you’re not aware of these types of opportunities.
Why would a Redondo Beach home seller want to sell the home off market?
In general it’s not a great idea. Fewer buyers that know about the home usually means less competition and ultimately a lower sales price. That’s certainly not always the case but usually accurate to some extent. Sellers have many reasons for not wanting to put their home on the market. It may be due to privacy reasons such as not wanting the neighbor or even the tenant know that the home is for sale. It may be that they don’t want to deal with some of the hassles that come along with listing a home…..buyer’s and agents that want to show the home at all hours, open houses on the weekends and more people simply curious with few legitimate buyers. Whatever the reason it does limit the exposure and again usually limits the price.
That’s why it can be a good opportunity for buyers….less competition, fewer bidding wars which generally leads to a lower sales price.
How do I find out about these homes in Redondo Beach?
Unlike the MLS listings, off market, upcoming and pocket listings are much more elusive. The key is to work with an agent that has deep connections in the community and market. Some of the top realtors in certain areas may share information on these hard to find opportunities and the larger or more numerous the seller and agent networks, the more information the agent can obtain.
We are happy to help you find off market homes but this requires a good deal of work, considerable communication with sellers and agents and a readiness to act should the right home come available. If you would like us to help find off market opportunities and you are not currently working with a realtor please feel free to text us at 310-251-2344 or email us with the details of your home search.
I get a number of inquiries from my site SouthBayOceanFront.com from buyers looking for a beach front home on The Strand in Manhattan Beach and Hermosa Beach. Many of these buyers are extremely qualified and have the ability to comfortably purchase multi-million dollar homes. The problem in today’s market is that values along the beach in Hermosa and Manhattan have gone up considerably in the past 18 months. There are currently 9 oceanfront single family homes on The Strand and 8 of them are priced over $10,000,000. That was a relatively unheard price point just 2 years ago and now there are several over $15,000,000.
So what is a $5,000,000 buyer to do?
Unfortunately homes becoming available in that range are probably a thing of the past, but there is an option not far and it may even offer attributes that The Strand can’t offer. The area is the Hollywood Rivera (about 10-15 minutes south) and there is a fantastic bluff top street called Paseo De La Playa that offers oceanfront homes, large lots that extend all the way to the beach (some fortunate homes have paths that access the beach directly from the home), and views not only of the beach, but Palos Verdes, the ocean, King Harbor, and coastline views that extend all the way to Malibu.
As of this post, there are 2 oceanfront homes for sale on Paseo De La Playa. The first is currently in escrow located at 605 Paseo De La Playa and is listed for $4,295,000. The second is an off market sale in which the owner is trying to sell it themselves at 617 Paseo De La Playa and the owner is asking $4,350,000.
The homes on Paseo were all originally on leased land with many of the former owners buying out the leases in the past and are now owned free and clear. Built in the 60’s and 70’s some of the homes are fairly original while many have been extensively remodeled.
There’s no doubt that the current market conditions greatly favor sellers in Redondo Beach. Demand has remained strong with low interest rates and low inventory and every “deal” seems to be a competition between every buyer interested in the area. Tear downs get bought by builders, fixers get scooped up by flippers and investors, demand for mid range properties and townhomes continues to drive prices up, and the influx of money on the high end means luxury properties often disappear in a hurry as well.
Pocket listings and off market homes are all the rage in this market and can sometimes mean less competition and allowing buyers a “chance” to find something and pay a reasonable price. With social media, networking groups and an abundance of realtors chasing every possibility these off market homes are less of a secret than they used to be, but still offer the most likely way of a buyer having a chance of finding a home and avoiding a bidding war.
Pocket and off market listings can mean a lot of different situations. Sometimes a realtor has a listing agreement that doesn’t start for a while, sometimes they home is getting “prepped” and isn’t quite ready for the market, sometimes a realtor talked with a homeowner and they don’t want it on the market but may consider selling for the price. The reasons are endless but these are all sellers that would consider selling their home.
So how does a buyer find out about these types of homes?
As these homes are not on the market, that means they’re not on the MLS which means they don’t generally show up on the Zillows, Trulias, Redfins and the searches that realtors send their clients. These homes are more likely found by realtors very tied into the local market. Whether through direct contact with potential sellers, networking groups, inter office communications or other sources, they are certainly harder to find.
The best bet is to look for a local real estate specialist that sells quite a bit in the area you’re looking. Realtors that have experience in the area and have been successful, generally have made connections with sellers and realtors that could ultimately be very beneficial to you. If you already have a relationship with a realtor that does all of that than let them know you’re searching for off market, as well as on market, homes. If you don’t have that relationship we would be happy to help and search resources most realtors don’t have access to. Contact us or fill in the form below to get started.
Understanding off market and pocket listings
With the extremely tight inventory of homes for sale in the South Bay, many buyers approach me looking for off market, or pocket listings. Pocket listings and exclusive listings are the hot trend at the moment as eager buyers clamor for a chance to purchase a home without all of the competition. In this market knowing about it first may not ultimately make a difference, but it certainly helps. Many agents seem to be trying to keep listings private as well in the hopes that perhaps they can represent both buyer and seller, which is much easier if fewer agents know that the home is for sale. So what do the terms actually mean? A pocket listing can be anything from a realtor simply knowing about a home that a seller might consider selling and not having a listing agreement, to something coming to the market but not yet on the MLS, to the intentional withholding of the listing from the MLS.
But is it beneficial to the seller?
In terms of price, exposure, etc. the answer is generally no. The more exposure the home gets, the more potential buyers see it, and the likelihood that it will sell for a better price and with more favorable terms for the seller. Eliminate that competition and generally speaking the chances of such favorable terms decrease.
There are very legitimate reasons for exclusive or “pocket” listings and for keeping the property off the market…..work being completed, tenant issues, or simply a seller who doesn’t want the world touring their home. Seller’s just need to be sure that the reasons for keeping a home off of the South Bay MLS are beneficial to them….and not just to the listing agents.
Whether keeping a listing from the MLS is good or bad for the seller ultimately depends on the situation and whose best interest is the primary reason, but working with a top local realtor who has the network and knowledge to seek out these possible opportunities is certainly key for the buyer.
With the local real estate market so active, home inventory at near record lows and buyers in a frenzy to find homes, the buzz is all about “off market” listings. So what does that really mean and how can it benefit you? Off market listings can mean a number of different things which can include:
- Exclusive listings – This is a situation in which a realtor has a signed listing agreement but the seller doesn’t want it on the MLS for some reason. This can sometimes be due to the home having tenants, can be due to sellers simply not wanting to go through the hassles of open houses, endless showings, etc. This usually will get the seller a lower sales price, but for many it’s well worth it. It’s great for home buyers to know about these listings as the competition can be far less fierce. Less competition can often mean better price and terms for the buyer
- Upcoming listings – sometimes a home will be coming up for sale but just not listed yet. The usual reason is that the seller is getting it ready for the market. This can mean anything from doing major work/upgrading to simply cleaning it up. If you can get in early before the seller has spent money there is an opportunity to buy at a lower price.
- Pocket listings – this is a situation in which someone (usually a realtor) knows of someone that “might” consider selling. As they usually do not have a listing agreement signed it’s tough to get much information from them. Agents often contact me with pocket listings and may give a street or a vague description but often not an actual address.
There are other opportunities as well with some sellers taking a “make me move” type approach in which the right price just may get them to consider selling. Other potential opportunities may include knowing which homes have a notice of default or notice of trustee’s sale, and they may consider doing a short sale (although most lenders require the home to be “on the market” for them to consider)
So how do you find out about off market listings? The best way is to find a local realtor that spends time networking with other agents and homeowners. Intimate market knowledge is critical as many top agents share listing information prior to it going on the MLS or being marketed to the masses. I generally hear of 10 listings or so each week that are off market or not yet listed and this can be a tremendous advantage in a market that is so competitive. Contact South Bay realtor Keith Kyle for information on off market listings and homes not yet on the MLS.