It’s a question I’ve heard raised a little recently: Is there any value in selling my property off market? With real estate prominently in the press for a variety of reasons, from housing affordability to the auction clearance rates, I’m not surprised there’s interest in new ways to sell a property.
Selling off market for those of you not familiar with the term, is to sell your property without a public listing and marketing campaign to drive buyer interest. There’s some suggestion it’s on the rise, especially in the major capital cities. For me, I would question whether the rise is as big as some commentators are suggesting (despite the recent publicity surrounding ‘Aussie’ John Symonds off market sale). In any case it’s certainly more prevalent in the market than it was in previous years.
My advice when I talk to people about it is more around the pros and cons: Is it really an effective way of selling your home?
Why sell off market?
There’s a number of reasons why a vendor may chose to sell their home off market however the two that we see today as the most common are:
- The vendor needs a quick sale: rather than go through a longer sales cycle, if a vendor is looking for a quick sale and is not overly concerned about maximising the price they achieve, the off market approach is seen as potential option, especially if you’re using a strong agent with good buyer relationships;
- If the vendor wishes to avoid publicity around the sale: I have seen this on some prestige properties. This might be due to the high profile nature of the vendor or just a simple wish for privacy.
As I mentioned above, it is certainly more prevalent in the market today. There’s a good case to say that the ‘hot’ property market is part of the reason why this is more common. Real estate and buyers agents are more likely to chase down property that meets the buyers requirements, which can lead to a vendor who’s not officially in the market getting an offer that’s difficult to refuse.
What are the pitfalls?
As the age old selling mantra goes: “You can’t sell a secret”. I’m still a believer that competition in the marketplace is the greatest driver of price and a strong agent makes the most of that competition for their vendor. Without a marketing campaign to expose your property to the largest number of buyers, it’s difficult for you to know if you really attracted the highest price. By keeping the property off market you’re really limiting the number of buyers you can engage, and in my opinion that fair outweighs the perceived benefits. It’s worth remembering that this is still a small percentage of the overall market; I’d put off market sales at somewhere around 5% in my opinion.
We’ve built strong buyer relationships both with prospective buyers and buyers agents and we’ve still seen good results in off market deals. So it really comes down to choosing the model that best suits your interests. If off market is something you’re interested in, talk it over with your agent before making a concrete decision.