By David Howell, Vice President & CIO at McEnearney Associates
You may have seen a sign in front of a home that says “Coming Soon” or you may have heard the terms “pocket” or “whisper” listings. Well, those are not the same things, but they all represent areas of possible concern when it comes to doing the right thing for sellers.
Let’s start with some basics.
First, we firmly believe that sellers will get the most for their property in the shortest amount of time when it is exposed to the broadest possible market. And doesn’t that make sense? After all, you never know where that buyer is coming from. No real estate company and no real estate agent have all the buyers, so why hide a listing?
Second, a property gets the most traffic and the most exposure in the first few weeks of that broad exposure to the market. We know that to be the case in good markets and bad — and everything in between. So “testing” or teasing the market in a limited way may not be the best idea.
Third, a home shows best when it is fully ready for the market, when all improvements or repairs have been made. You don’t see a new car showroom with a model on the sales floor that needs a paint job.
Fourth — and this is the most important one — the sellers of any home should give their informed consent to have their home marketed prematurely or to a limited audience.
So, with all that being said, and with inventory being tight in so many parts of the Washington metropolitan area, we see a fair number of homes with a Coming Soon sign in the yard. There can be some very legitimate reasons for that — a home may be a couple of weeks away from being ready to go on the market and the sellers want to be sure that buyers looking in their area are aware that they will have another option in the near future, and they don’t want to run the risk they’ll lose that buyer to a home already on the market.
But remember that the people who are aware of that sign may be limited to the people who drive by. One of them may approach the sellers to see the house before it’s fully ready to be shown — or even make an offer so they get the jump on other buyers. On the surface, that may seem like a good thing: The sellers get interest and maybe even an offer before the house is fully exposed to the market, and are spared the hassle of having to make the beds every day. But sellers don’t know what they’re missing; they don’t know how many potential buyers there are who might have been interested in their home if they had known it was on the market.
But sometimes that Coming Soon sign is up so that the listing agent increases his chances of selling the house himself. And that’s even more true of a “pocket” or whisper” listing — when the agent only tells a handful of people that a house is available. And who is best served by that? It’s hard to see how a seller benefits, and lots of would-be purchasers are deprived of the chance to buy.
The point is simply this: Sellers should know the pluses and minuses of marketing their home to a limited audience, and it should be their decision whether to cut off part of the pool of potential purchasers.