By Scott Gaertner
Contrary to popular local myth, I did not invent “Coming Soon” listings. I actually took the idea from a Canadian agent at one of the quarterly mastermind meetings I attend. It was the perfect solution to the problem of one of our clients missing the home of their dreams that sold for far less than they would have paid.
How it happened: the next-door neighbor to the listing had a friend looking for a home in that specific neighborhood. The neighbor noticed the for sale sign the morning it went in the ground and called her friend. The home sold before any other buyers even knew it was available. This quick sale hurt the sellers because they got far less than they should have for the home, and it hurt our buyers because they didn’t get the home they really wanted.
That is when I decided we needed to pre-market our listings and found the Coming Soon strategy. I had seen it used sporadically but until that moment it didn’t make sense to me. Suddenly it did. Since then even the Arizona Regional MLS has embraced the strategy, and it has been used more and more, but not always in a way that benefits buyers and sellers.
The standard of professional Realtors® is to list each home for sale on the MLS to encourage healthy competition. I believe open market forces will determine the real price of any good or service if they are allowed to work. Having one buyer see the home is not allowing market forces to work.
So let’s take a look at the pros and cons of Coming Soon.
You Know You Get Market Value: If thousands of people have seen your home, and dozens of people come through your open house, and you get multiple offers, I think you can feel that you got market value for your home.
Save Days on the Market: You get early exposure without burning any precious “Days On Market.” Buyers love to use Days on Market as a negotiating tool.
Stops Buyers From Buying Something Else: The buyer that is looking for what you have will wait.
Homes Sell Faster: A recent study showed that coming soon listings sell 33% faster.
Earlier Exposure: The house doesn’t need to be 100% show-ready before you start to get eyes on the property. You get visibility of your home ASAP while the rest of the cleaning, pictures, open house preparation, and advertising is still coming into place.
Better Terms: This type of competitive environment can not only yield a better price but also better terms. Too many of our clients, the terms are equally, if not more, important than the price. Choosing the perfect closing date would be an example. We have gotten folks very fast closings so they can get somewhere they need to be, and we have had our sellers stay in their homes after closing.
Less Foot Traffic: Demand is created before you push the listing live, and there can be a line of showings on day one. By marketing in advance, we can often get the home sold with significantly fewer showings.
Might Get a Premium: If a buyer makes an offer you are considering before going live, they should be paying you a premium. They don’t want the competition, so make them pay for the opportunity.
I looked hard to find cons, but the only con is when it isn’t really a coming soon listing; it is a “pocket listing.” A pocket listing is any type of real estate listing that a listing broker or salesperson retains and is not made available to other brokers or other multiple listing services (MLS) members. If a Coming Soon listing never enters the MLS or sells before other agents have a chance to make offers, it is effectively a pocket listing. The “Coming Soon” status is the opposite of a pocket listing. Instead of an agent keeping the inventory to themselves, including inventory that is not even on the market yet, they are trying to share it with everyone on the MLS. The pocket listing also has the opposite effect of the Coming Soon in that it reduces exposure.
Beware Of The Wolf In Sheep’s Clothing
As mentioned above, just because someone calls it a Coming Soon, it could still easily be used as a pocket listing. Last year, the Arizona Regional MLS made some changes to ameliorate these types of abuses, but we still see it every day. Talk with your agent to make sure you are all on the same page.
Scott Gaertner is an Associate Broker with Keller Williams Northeast, who for the past 25+ years has helped more people to find their lifestyle niche in the Scottsdale North area than anyone else. He also contributes his thoughts on lifestyle interests in the area.