Selling an apartment without publicizing it (called an “off-market” or “whisper” listing) may seem seedy, but it’s actually perfectly legal. Sellers like whisper listings because they rarely have to host open houses. Buyers like them because they offer the opportunity to get a place without having to deal with a bidding war. But what are some other pluses and minuses to selling a unit without ever officially listing it?
- Less negotiating: Owners who haven’t officially decided to sell (or who’ve been approached by an interested buyer before listing) will typically let a broker know that they’d consider it for a set price. If a buyer appears who’s willing to pay that amount, there won’t need to be that much negotiating.
- Everything happens in a hurry: Since there’s rarely a bidding war (and not many people know about it) deals can get done more quickly than usual.
- Fewer open houses: Have small children you’d rather not make scarce each and every time an interested buyer wants to view the place? Or just can’t stand having to keep the place pristine all the time? An off-market sale might work better for you.
- Keep it out of the press: Celebs and other VIPS often favor these secret sales because they’re more likely to stay out of the papers.
- Lower broker fee: There’s usually only a single broker involved in these types of deals (since the listing broker brings in buyers he already knows instead of sending the listing to other brokers who’ll bring in their clients). And because it’s just one broker, the standard 6 percent commission becomes more flexible—sometimes as low as 3 percent.
- Lower prices: If you’re a seller looking to get the highest price possible, you’d be wise to list your apartment the regular way. Since a buyer looking to purchase an off-market property isn’t competing against anyone, he or she has no incentive to bid higher. While this is great for the buyer, it’s not so great for the seller.
- Board disapproval: Your building’s board wants the highest comps possible in order to protect property values within the building. They might worry that you haven’t gotten market price and therefore refuse to approve the sale.
- Deals fall through more easily: Since many of these properties aren’t officially for sale—sometimes sellers just want to know what kind of price they could get—sellers often get cold feet and pull out before the deal is done.
For more, check out our three-part series exploring off-market listings, “Buy and Sell Like a NYC Insider: Your Guide to Elusive ‘Whisper’ Listings Part 1,” “Part 2” and “Part 3.”
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