Have you ever wondered what selling off market entails? Whether it’s a good idea or not worth the risk? Well, we’re here to spill the tea on selling property off-market, including the advantages and disadvantages, so you know whether it’s the right sale method for you.
What is off market selling?
In real estate terms, selling off-market means selling without public advertising or a public listing on major real estate channels to drive buyer interest. The seller’s agent is responsible for contacting interested buyers, and the house can be purchased in a private sale if the owner is presented with an acceptable offer.
Why would you sell off-market?
The main reason you’d sell your property off-market is if you need an immediate sale. Typically, the sale is more important than obtaining the best sale price. Some other reasons people choose an off-market sale include the following:
- If they have a higher profile and don’t want their home in the public eye garnering unwanted media attention.
- Deceased estates
- An urgent need to relocate.
- If they’re stuck in a sticky situation, such as divorce, difficult neighbours or a complicated family issue.
- A complicated financial situation, like a change in employment.
- If a vendor is in an area with a high number of properties selling, they’re likely to sell off-market quicker and forgo advertising costs.
- If the seller’s agent has sold similar properties recently, they may have several interested buyers who missed out on a sale and would be interested in snapping up the property off-market, saving unnecessary advertising fees.
- The vendor wants to save money, as we all know how expensive marketing campaigns can be, particularly in capital cities.
Benefits of an off market sale
Let’s look at the advantages of off-market selling for both buyers and vendors:
Advantages for sellers
- Selling your property off-market is generally a much cheaper option, as you don’t need to pay marketing and advertising costs. If you’d like to sell your property cheaply, selling off-market is the right decision for you.
- If you want a quick sale, off-market is typically the way to go. When agents have a strong buyer network, selling off-market can be ideal for a quick sale. It’s also a much faster process when you don’t have to wait for materials like professional photos and signboards and to create a build-up before hosting multiple open house inspections.
- There are typically more terms and conditions which work in the vendor’s favour, like a shorter settlement period, a bigger deposit and inclusive of any building faults.
- There’s no option to auction your property if you sell off-market. This saves you the risk of a prolonged selling process if the property doesn’t sell on the day.
- Many vendors choose to sell off-market as it’s less intrusive and allows them to maintain their privacy.
Advantages for qualified buyers
- The big advantage is that off-market sales generally save you money. Because there’s a lack of buyer interest and less competition, this exclusivity can lead to a much lower price than the vendor would probably receive on the open market.
- There’s a strong likelihood the vendor is desperate for a quick sale and will quickly accept your offer.
Risks of off market sales
Now we’ve covered the advantages, here are the disadvantages and risks associated with selling off-market:
Risks for sellers
- The biggest risk of selling off-market is the likelihood of receiving a lower sold price than if you had advertised. This is due to the need for the increased public interest you’ll receive before selling. Overall, you’ll save on advertising costs, but at the same time, you’ll risk losing thousands or even tens of thousands of dollars on your final sale price.
- An off-market sale means you can’t go to auction. There’s a build-up and hype attached to auction days, and they can create increased competition between buyers, often leading to a higher sold price.
- No online listings mean you’re missing out on a massive pool of passive buyers who frequently scroll through real estate websites looking for their next investment or owner-occupier property.
Risks for qualified buyers
- It takes time to build and maintain solid relationships with local agents, and you need to have this connection to get insider information about off-market sales.
- There are no marketing materials available, which many buyers require to create a visual file of potential off-market investment properties.
Selling off-market FAQs
What’s the most important thing when selling off-market?
To reach the maximum number of buyers off-market, the most important thing you need is to find a real estate agent with a large network of interested buyers they can contact privately. To make an informed decision and a shortlist of the best agents for the job, visit LocalAgentFinder.
Relationships are key. Without a good real estate agent with a large buyer network, you’re at risk of little exposure and a low sale price. On the other hand, when you agree to advertise your property, your real estate agent has the opportunity to do everything in their power to get you the best outcome possible.
How do potential buyers find an off-market listing?
This is when prospective buyers must have a relationship with their local real estate agent. But it also doesn’t hurt to make connections in associated sectors, like mortgage companies, bank home loan associates and valuation experts.
If they know your particular needs, like your budget and the type of property you’re looking for, they’ll immediately advise you if they take on an appropriate off-market listing. Building and maintaining this business relationship is particularly powerful for investors looking for bargain properties. Having the right connection and the right price is the key when it comes to securing an off-market property.
Can you take your home off market and re-list it later?
In short, the answer is yes, and you can have an off-market property that’s re-listed in the future with all the bells and whistles. The only downsides are the same as any public sale: the extra costs and the fact it might take longer to sell. Ask your agent for their recommendation and review your sales contract, as there may be fees to pay.
Do you need to pay your real estate agent if you take your house off the market?
Yes, you’ll likely need to pay fees for selling off-market and also for re-listing in the future if that’s your preference. Any payments will be listed in your contract’s terms and conditions.
Is selling off market a good idea?
As the percentage of people selling property off-market continues to rise, you’re probably wondering if it’s the safe option and whether you should jump on the bandwagon. The answer is that it could be, or you could lose out on tens, and potentially hundreds, of thousands of dollars. If you’re looking to sell your house cheaply and quickly, perhaps selling off-market is right for you.
Selling your home off-market can also be a good idea in a booming property market where demand outweighs supply. Sometimes, a real estate agent or buyer will approach a vendor with interest in their property, even when they’re not in the market to sell. But if the offer is appealing enough and in line with market value, you may want to go down this avenue.
However, if you want to attract as many potential buyers as possible to your property and achieve a high final selling price, advertising your property is the smart option. If you’re looking for advice on selling on or off-market, the best place to start is to talk to a local real estate agent.
What is a buyer’s agent?
A buyer’s agent is a real estate professional who represents the interests of the homebuyer. The agent works with the buyer to find the perfect property and negotiate the best possible price and terms for the purchase. A buyer’s agent can be an invaluable asset for anyone looking to purchase a home.
What’s next?
When it comes time to sell your home, you’ll want to hire the right agent for the job, whether you sell off-market or not. Browse local real estate agents at LocalAgentFinder to compare their commission rates, marketing fees, sales history, homeowner reviews, and so much more.