Over the past 12 months all of my clients’ house purchases, bar one, have been "off market". An "off market" house is one which is not openly marketed but is instead for sale in a discrete or private way. More and more house transactions are taking place off market, particularly at the £2m+ level.
I am often asked "why would a seller chose to sell a house off market?". "Surely the best way to sell a house is to advertise it to as wide an audience as possible?" However sharing one's house with the world wide web is not always the way to achieve the best sale.
There are in fact many reasons why a seller would chose to sell off market:
Surely a seller would achieve the best price by showing their house to as many people as possible? No, this is not true! In fact it is entirely feasible for a seller to achieve a better price by selling off market.
In the current market, where prime properties are a scarce resource, buyers are hungry for the best houses. While a house remains off-market it is that “holy grail”, that valuable secret. At this point the best and keenest buyers may be willing to pay more than a house is "worth", simply to prevent the house going on the market. Once a house has gone on Rightmove, once even just a few buyers have seen and rejected the house, the balance of power starts to shift - the buyer will feel more confident to negotiate and to seek a discount on the asking price. Of course this balance of power shifts even further once a house has been on the open market for a couple of months or more. The Rightmove and Zoopla bots will track the seller's every move for the world to see, and the mere presence of a "listing history" will devalue your home.
Equally though a seller might be willing to accept a lower purchase price in order to achieve an off market sale; it really depends on the situation and the motivations of each buyer and each seller.
TESTING THE MARKET
A seller might plan to market a house in an open way, but may want to "test" the market before undertaking a full marketing campaign - many prime properties in Hertfordshire are real one-offs and it can be difficult for an estate agent/seller to decide what a guide price should be - having a period of "off marketing" means that the appetite for a house and its price can be tested .
A seller might want to retain their privacy because they are well-known or because they are selling for confidential personal reasons (such as divorce or illness). Open marketing inevitably means opening your home to the public and being subjected to viewings by buyers who may not be proceedable, or by viewers who look at other people's homes as a weekend pastime! Off market sales avoid this intrusion.
And sometimes a seller just may not want to bother with the effort of presenting their house in the best light for photographs, or preparing their home for hoards of viewings - they just want to be matched with one buyer who is proceedable and who is willing to pay a fair price.
EXAMPLES OF MY RECENT OFF-MARKET SUCCESS
In June this year my client completed on the purchase of a £1.1m 4 bedroom family home in Much Hadham, Hertfordshire. This was a highly desirable home because the house was set in the middle of a unusually large plot off the High Street - the seller was always going to be able to sell this house very quickly. However my established relationships and my ability to present my client's buying position strongly enabled us to reach agreement at a competitive price before the house was openly marketed.
In September this year my client completed on the purchase of a £3m+ 11,000 sq ft property with land north of Hertford. I agreed a one-off viewing within 24 hours of the agent valuing the property, and was able to reach agreement on the purchase very shortly afterwards. No other buying agent or buyer saw this property.
In February and again in October of this year I was successful in agreeing purchase terms directly with two £3m+ homeowners that I had approached directly regarding a private sale.
So what is the lesson for the buyer?
Firstly the lesson is that in the current market you cannot wait for a house to come to you - you have to go out and look for it. As a buying agent I am constantly speaking to agents, hearing about houses on the grapevine, approaching home owners directly, using my contacts and local knowledge to work out who might be willing to sell their home. And secondly it is hugely important to find out and analyse the position of the seller - what are their drivers, what are their motivations? As a buying agent I am in your corner, gathering the information that you need and drawing on my house buying experience to put you in the best possible negotiating position.
If you would like help on your home buying journey, give me a call on +44 7702 630983
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