Pocket Listings Banned in 2020 – Portland Real Estate Market
Pocket Listings in Portland and throughout the U.S. have been a hot topic for a while. While some real estate agents argue for pocket listings in the Portland real estate market, most argue against them or at least want sufficient regulations in place to protect home sellers and buyers. Pocket listings are usually defined as homes for sale that are not listed publicly in a MLS system, but privately with a local Realty company who may also promote that listing to other local Realty companies or select networks of potential buyers.
Pocket Listings Changes in 2019, more coming in 2020.
Recently in 2019 RMLS, our local Multiple Listing Service here in Portland, Oregon created a coming soon feature for all Realtors who are members of RMLS (and virtually 100% of them are). The new policy let local Portland Realtors advertise their listings as no showing, coming soon listings for up to three weeks (21 days) in the MLS, where only other Realtors can see. After 21 days the listings have to hit the public market or be taken down. Alternatively, if a Realty company didn’t plan on putting the pocket listing for sale on the MLS at all, they could exclude it entirely from the MLS and keep it as a true pocket listing. But if that Realty company ever decided it wanted to put the same house on the public RMLS for sale, they would have to wait 30 days or more after the pocket listing was over before RMLS would let them input the listing. To get the full details on the RMLS CSN, or coming soon, no showing rule, go straight to the source – RMLS blog. This article doesn’t contain all the details of their rule and if interested, please check out their public information. Basically it created two tracks for local Portland real estate agents for pocket listings: 1. they could perform some coming soon marketing with all other local Realtors in the same RMLS, but not allow showings. This would help “get the word out” before the home hit the public market, but would likely ensure there were no private sales, since no showings are allowed, or 2. they could perform a true pocket listings and advertise it to whoever they wanted (following real estate laws appropriately) but if they ever wanted to put that same home in the RMLS they would have to stop advertising the pocket listing for 30 days or more, and then they could list it for sale in the RMLS.
Pocket Listings Banned in 2020 by the NAR, National Association of Realtors
Well, it is a near total ban on pocket listings for all Realtors in the United States as voted on by NAR in Nov. of 2019. Get all the details on this new policy straight from NAR here. Here is the part of the policy with the most direct impact on pocket listing practices:
“Within one business day of marketing a property to the public, the listing broker must submit the listing to the MLS for cooperation with other MLS participants. Public marketing includes, but is not limited to, flyers displayed in windows, yard signs, digital marketing on public facing websites, brokerage website displays (including IDX and VOW), digital communications marketing (email blasts), multi-brokerage listing sharing networks, and applications available to the general public.”
So option 2 above with RMLS, allowing Realtors to advertise pocket listings as long as they forego the RMLS and wait a period of 30 days after the non-MLS agreement has expired before submitting to the public RMLS, has a further restriction, the home simply may not be advertised as a pocket listing to the public at large. The only thing NAR doesn’t prohibit here is a pocket listing that the Realtor markets off the MLS within its own Brokerage or Realty company only.
Sometimes the seller is the only person that wants a Pocket Listing.
This is little understood in the real estate industry, but many times the real estate agent and their brokerage has no interest in pocket listings – but the seller does. Sometimes sellers want a private / pocket listing because they do not want all of the attention a public listing gets. They do not want thousands upon thousands of people to see interior photos of their home, they do not want the entire world as it were, to know that their home is now for sale. Most Realtors, myself included, always prefers to put the home on the public market and to get as much marketing exposure for the home has possible, as we know it will generate the highest price for the seller.
Pocket Listings have changed, probably forever.
Regardless of seller desire to have a pocket listing sale, what a Realtor is able to do for them in 2020 in terms of a pocket listing, is greatly reduced to almost be a non-option. There are currently over 1.3 million Realtors in the U.S. and to limit exposure of a home for sale to only those within one Brokerage makes a pocket listing or private sale close to impossible. A pocket listing in the year 2020 will not be accessible to the general public per NAR rules, it will not be accessible to the 1.3 million Realtors in the U.S. who might bring a buyer, it will be so greatly reduced as to only be able to be seen by Realtors within the same Brokerage.November 18, 2019