A Behind the Scenes Look at What’s Really Happening Behind the Scenes!
You’ve all heard the stories (and so have we)! Your friend’s cousin purchased a home off-market and got a great deal! You know … the home that no-one else knew about that was secretly for sale, and the owner decided to sell below market value because they’re just super lovely? You know, that one cousin, that one house and that one story [insert eye-roll here please]!
So, this particular article is dedicated to your friend’s cousin and some serious broken down telephone and urban real-estate myths. Unfortunately, there isn’t a secret society of off-market listings out there! And, there is definitely not a privacy-protected website out there with all of the hidden property listings!
Today, we are here to clear the air on this very subject and explain what Exclusive Listings are and how they shakedown.
DEFINING AN EXCLUSIVE LISTING:
An Exclusive Listing is when a Seller of a property enters a Listing Agreement with a real estate brokerage, but the listing itself does not appear on the MLS System. Exclusive Listings may be referred to as “off-market listings” or “pocket listings.” Generally, these can only be viewed by agents and brokers within the same brokerage as the selling agent, and these listings typically attract buyers through direct referral. When a property is listed on Exclusive, it will not appear on Realtor.ca (the public side of the MLS System) or any other popular search tools like Home Finder, House Sigma, or IDX feeds on broker’s websites. In light of this, the sale of your home may have less visibility to other real estate agents and prospective buyers compared to listings marketed on the MLS System.
Make sense so far?
ARE EXCLUSIVE LISTINGS ADVERTISED?
If a property is listed on Exclusive, it will not be listed publicly on the MLS System. However, the home may be posted or “searchable” using the following resources:
1/ Off-market listings are often shared internally at the Brokerage level. For example, if we listed a home on Exclusive, our umbrella company [Sage Real Estate] would email all of the agents and brokers at our office with the Exclusive listing details, including the address, price, property details and photographs when permitted by the Seller.
2/ Exclusive Listings are often posted on internal brokerage-to-brokerage communication tools such as Broker Bay and Lone Wolf. These real-estate software systems provide tech services to brokerages related to booking and cancelling appointments, requesting feedback, sending communications, and advertising off-market opportunities. For example, we at Fox Marin Associates can see all of the Exclusive Listings currently under contract in GTA using Broker Bay – we can search by price, size, room count, location and more! Now, I would love to tell you there are many “secret” listings posted here, but the pickings are slim!
3/ You may also find Exclusive Listings posted to social media via the individual agent representing the Seller or the brokerage as a whole. There are Exclusive Listings Facebook Groups and several hashtags you can try searching on Instagram or Twitter that may help you undercover some off-market opportunities. Examples include #exclusivelisting #exclusivelistingtoronto or #exclusivepropertylisting! if you find any great ones, tag us @_foxmarin for sure!
4/ In some cases, you may see a lawn sign in front of the Seller’s home that says “Coming Soon” or “Exclusive Listing”. Be sure to read about this tactic further down below because sometimes (not all times), we are not super pleased with the outcome!
WHY WOULD A SELLER LIST A PROPERTY ON EXCLUSIVE?
There are several reasons that a Seller may consider listing their property on Exclusive:
1/ This is often a popular approach for luxury homes at higher price points. There is an added level of privacy during the home selling process.
2/ Exclusive listings may be useful for an estate property or a home occupied by elderly owners. It’s less invasive when the house is not open to the public. The Seller and their agent have more control and can oversee things by qualifying potential purchasers in advance of viewing to avoid unnecessary inconvenience, preparation and disruption.
3/ Many agents and brokers list a property on Exclusive before going to the market using the MLS System. This strategy is an excellent way to “test the market” before exposing the listing to the public. In other words, agents can invite colleagues and clients to view a property to provide feedback on pricing, condition, location and staging before formally listing the property on-line. If any adjustments need to be made to the listing plan, they can handle upfront. It’s a wise choice for listings that are difficult to price or have a unique value proposition.
WHAT IS THE DOWNSIDE OF A SELLER LISTING ON EXCLUSIVE?
In a market like Toronto that is currently hot-to-trot, it does not make sense for a Seller to list their property off-market unless there is a pre-determined strategy or rationale as to why!
In a Seller’s Market like ours (lots of demand, little inventory) – it makes the most sense to expose the property to the open market to elicit the highest and best price for a home. If a home is not advertised to a sizeable & qualified buyer pool, the Seller could leave money on the table. In these market conditions, it’s impossible to predict what a Buyer may be willing to pay you for your home – but we can guarantee that it’s often more than we would all expect these days!
The other downside is that some agents and brokers used this method to list a property to serve their own best interest. For example, when you see a lawn sign that says “Exclusive Listing” or “Coming Soon,” the Listing agent is often looking for early sign calls and buyer leads. Instead of considering how to serve their Seller’s best interest, they may be strategizing on how they may double-end a deal and earn commissions by representing the Seller and prospective buyer rather than focusing on getting the highest and best price for their seller. Now, this is not always the case – but it happens more frequently than you would think! Have you ever seen a “Coming Soon” sign followed quickly by a “Sold Sign”? Just sayin’!
A BRIEF WRAP UP:
We know that it’s a challenging time to be a buyer in Toronto’s current market conditions. No inventory. Multiple offers. Every listing sold within days. Bully offers left, right and centre. And, there doesn’t seem to be an end in sight! Unfortunately, there is only so much you can control, and this fast-paced real-estate climate cannot and will not last forever.
In the interim, we want to make sure you’re with the correct information! With as many tools at your disposal as possible! So, Exclusive Listings do exist, and maybe your friend’s cousin’s sister’s babysitter did find a cute house for under $800K two-years ago in Downtown Toronto – but the chances are pretty slim if you ask us (so, you’re not missing out … we promise)!
And, know, we’re always keeping an eye on the prize and keeping a close watch on those off-market postings just for you! Cross-our-hearts!
This article was written by Kori Marin, Managing partner here at Fox Marin Associates. For high-energy real estate aficionado Kori Marin, a well-lived life is achieved by maintaining an “all-in” attitude that realizes every last ounce of one’s full potential. This mindset has driven successful results in every aspect of her life – from her corporate sales and account management experience to her international travels, to her years of fitness training and leadership – and is the hallmark of the exceptional work that she does on behalf of her clients in the residential real estate sector in downtown Toronto.
