What is an off-market property?
Off-market properties are properties that are not publicly advertised for sale across mainstream real estate channels.
Instead, sellers list their property with real estate agents or websites who then match the property to selected buyers without the need for ads or open homes.
Most of these off-market properties are actually pre-market listings.
And then there are true off-market properties where for whatever reason, a seller or vendor doesn’t want to make the sale of their property public.
They’re also known as silent listings, quiet listings or pocket listings.
Why would anyone sell off-market?
Off-market sales have rapidly taken off across Australia throughout all price brackets, especially in the eastern capital cities.
Different sellers or vendors have different reasons for preferring off-market listings. Here are some common reasons for going off-market:
- To save on marketing and advertising costs. $10,000-$20,000 is generally how much you’ll save in marketing and advertising costs by going off-market. This cost-saving is then passed on to the buyer, which sweetens the deal and makes the sale more likely.
- The need for privacy is one of the more common reasons. Divorce, death or a change in financial circumstances often leads to a need for a quick but private sale.
- To avoid the hassles of being open for inspections every week. Instead, you have a few serious buyers inspect the property.
- Nervous about auctions. Some sellers don’t want to deal with auctions or lots of potential buyers trampling through their property. Especially, owner-occupiers still living in the property who want their privacy.
- Where there’s a tenanted property, and the tenants have made access to the property very difficult for potential buyers. Or tenants who may not keep the property in a presentable condition.
- When auction clearance rates are low, it creates a higher risk and uncertainty for vendors. So, they prefer off-market listings.
- To sell urgently and quickly.
In recent years, more and more buyers are preferring to buy off-market properties especially in and around Sydney and Melbourne.
How to find the right property
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How do I find off-market properties/ listing?
The good news is that you can find off-market properties yourself with a little help.
Real estate agents
As off-market properties are not publicly advertised you can’t easily find them unless you’re in touch with real estate agents in the area.
Buyers neet to get onto the email lists/ databases of real estate agents in the area you’re looking to purchase and be honest with them about what you’re looking for as well as your budget. Or email them directly.
Let them know exactly what you’re looking for:
- Your price range
- The suburb/area
- The type of property – house, townhouse, unit etc.
- The number of bedrooms
- Proximity to transportation, schools or services
- Any other particular features/ amenities you’re after
Agents love this as it helps them to convince potential sellers to put their house up for sale and secure the listing as well.
Beware that since you’re telling them a price range, that could affect your negotiating position.
Examples of off-market listings offered to select buyers before they’re listed online:
Off-market websites
Off-market listings have exploded in Australia as such there have been innovative property matching websites such as Property Whispers, Listing Loop who make it free for buyers to register.
Buyers can input information about the type of properties they’re looking for and are instantly matched with properties in their databases that match your needs.
Buyers register for free.
With these websites, there isn’t a list that you can browse.
Hire a buyer’s agent
Buyers agents are really good at finding perfect off-market properties and typically half the properties they buy are off-market.
They charge around 2% of the purchase price as it’s more work, sometimes they even go door knocking and ask people if they want to sell, so no real estate agent at all.
The good news is that we can do this ourselves. Well not the door knocking but the rest of it is easy enough.
If you know the criteria (land size, bedrooms, location, requires renovations, price range etc then you can email all real estate agents with properties for sale in the suburbs you like and ask them if they have any off-market properties for sale that meet those criteria.
Beware that since you’re telling them a price range, that could affect your negotiating position.Make sure you have evaluated the property value before starting negotiations.
Investors, time poor individuals and interstate buyers can let a buyer’s agent do all the legwork for you.
They have proper industry knowledge and access to unlisted properties because some vendors rather deal with an agent for a quick sale rather than go through spending time and money on a real estate listing.
Other viable ways to find off-market properties are:
- Networking: Three key people are often privy to unlisted properties such as contractors, real estate attorneys and wholesalers. Networking with these professionals could give you options not yet listed on the market.
- Public records: Public records often feature pre-foreclosures or short sale properties on local newspapers and state and local council websites. These are a good source of finding pre-market listings. Foreclosure properties and failed foreclosure auction or REO properties owned by lenders are also sometimes listed.
- Word of mouth: Ask your friends and family, your mortgage broker and even your solicitor if they know any off market opportunity. The next time that they come across one they’ll remember that you’re interested.
However, be careful of off-market properties as they aren’t all great deals due to some agents ‘buying the listing’.
That is to say, they entice the seller with an inflated estimated selling price to get the listing and then slowly condition the buyer to the real market price of the property.
Finding great off-market properties is not easy but definitely worth the effort.
How does buying an off-market property benefit buyers?
- Buying off-market can be less stressful and more convenient for buyers who don’t want to go to multiple viewings and auctions.
- The off-market nature of the listing means there is less competition from other potential buyers. With lower competition, there’s a chance you will get the property at a lower price than with a full listing with property marketing. This is especially important in a buyer’s market.
- Unique opportunities due to unfortunate circumstances on behalf of the seller such as financial hardship or a property owner looking to quickly let go of the property.
- As a buyer, you’ll find sellers are likely not in a rush allowing you to take your time and finish due diligence. It also allows for a more flexible transaction timeline.
Are you looking to buy off-market – We can help!
Buying off-market is a much quicker process as such you should have your home loan pre-approved and ready to go.
Get a free no-obligation assessment from one of our specialist mortgage brokers by giving us a call on 1300 889 743 or fill in our online enquiry form today to get pre-approved.
