Buying a Home that is Not For Sale — What You Need to Know
Would you like to buy a house that is not on the market?
Can you buy a home that is not for sale?
It has happened to everyone at one time or another. You are driving through an area when you see a property, a perfect home, that you would love to live in.
The only problem is there is no for sale sign or listing on the multiple listings service (MLS).
Whoever lives in the home is not currently selling—and may have no plans to sell.
So the question is, can you still attempt to buy the house?
The short answer is “Yes.” But buying a home that is not on the market is complicated, and there is no way to know how successful you will be.
While the owner could be interested in selling, they could also plan to keep the home in the family for generations.
You will have to tread carefully and take the proper steps to ensure that whatever chances you have of purchasing the home are not dashed through missteps.
Keep reading for tips on how to find a home that is not for sale.
What Are Unlisted Homes For Sale?
There can be two types of unlisted homes for sale. The most common type that everyone talks about is called a pocket listing. Pocket listings are those homes for sale that the public doesn’t know about.
An owner will give one real estate agent exclusive rights to sell their home. The downside for the seller is that they get minimal exposure. It leads to selling their property for less than it otherwise would.
Sellers who go this route are often looking for privacy. The other type of unlisted real estate is just owners without the intention of selling.
Why Purchase Unlisted Real Estate?
The most significant attraction of buying a house not listed for sale is less competition. If other buyers don’t know about it, their chances of negotiating better terms increase.
Looking for unlisted real estate drastically cuts into the buyers you would generally be competing with.
Buying an Off-Market Home Can Be an Option in a Tight seller’s market.
Whether it’s a buyer’s market or a seller’s market, you can always attempt to buy an off-market property. Home buyers often consider off-market homes when they have failed to land the homes they wanted due to a tight seller’s market.
You may have made multiple offers and been outbid every time. Bidding wars on houses are commonplace in hot seller markets.
After enough losses, the idea of approaching an attractive home and making an offer can seem appealing even if it is not for sale.
If you cannot successfully purchase a home in your desired area due to stiff competition, an off-market home may be the opportunity you have been waiting for.
So how do you go about buying a home that is not for sale?
Ask Your Real Estate Agent to Check Homes Previously For Sale
Ask your real estate agent to check canceled, expired, and withdrawn listings. They can also check coming soon listings in MLS.
One of the best ways of finding properties that are not currently for sale is to have your agent check the MLS. There are different property statuses in MLS besides what’s currently for sale.
These include canceled, expired, withdrawn, and coming soon.
Canceled Listings
A canceled listing is when a homeowner has taken their home off the market and canceled the real estate listing contract with their agent.
There could be any number of reasons why this has happened. One potential explanation is that the seller has fired the real estate agent.
In that case, the home could be re-listed again soon with someone else.
Expired Listings
An expired listing is a seller who has attempted to sell their property but has not had any success. The contract period between the real estate agent and seller has ended.
Often, expired listings end up as properties that come back on the market.
Withdrawn Listings
A withdrawn listing is a home that has been taken off the market and out of multiple listing services by the seller, but the real estate contract is still in full force and effect.
With a withdrawn listing, your buyer’s agent could contact the seller’s agent to see if there is any chance the owner still wants to sell. Sometimes the answer will be yes!
Coming Soon Listings
In many areas of the country, the coming soon home for sale status is relatively new. With coming soon listings, the property will be on the market shortly.
Multiple listing boards have rules on how long it can be posted in MLS before prospective buyers can view it. You could also see a real estate sign that says, “coming soon.”
As a buyer, you mustn’t go directly to the listing agent and create a dual agency situation. Make sure you have your buyer’s agent. It is foolish not to!
Have Your Real estate Agent Write Letters to Potential Owners.
Do you have an exceptional Realtor that will go the extra mile for you?
One of the time-tested ways to find a seller whose home is not on the market but is potentially willing to sell is to write them a letter.
Over the years, tons of real estate agents have written letters to homeowners for their clients.
Maybe you have identified a particular neighborhood that you love. It is common to put your real estate agent to work by canvasing that neighborhood.
The letter they would write is simple and to the point. It would state that they have a client (you) waiting for a home to come for sale in the area and if there is any interest in selling.
The note should give a clear understanding of your time frame and your financial ability to purchase.
You may get lucky and find that the timing was perfect. Many property owners are giving thought to selling. Getting a letter in the mail can potentially light a fire under them.
Maybe the owner would love to avoid having their home on the market and having all the foot traffic coming through.
For a seller making a private sale like this could be very advantageous.
Be forewarned that some sellers will be immune to getting a letter. It is possible they could have already been bombarded by investor-type companies such as “We Buy Ugly Houses” and others like them.
It is a common practice for real estate investors to send mass mailings to homeowners who might consider selling.
Ask Friends and Family if They Know anyone Planning to Sell.
Another resource to try to find a home that is not for sale is friends and family. People love to talk about real estate. It is not uncommon for folks thinking about selling to let their neighbors, friends, and relatives know ahead of time.
Have others do your work by keeping their ears to the ground.
Use Facebook as a Resource For Finding Unlisted Real Estate.
Facebook can be helpful for a lot of things. One of them is keeping up with local gossip. Part of that gossip may include people who are going to be selling their property.
It is not uncommon for folks to try to sell their home for sale by owner before they reach out to an agent.
Quite often, Facebook will be a platform FSBOs use to get the word out.
Zillow “Make Me Move” Used to Be an Option
Another potential avenue to find possible owners who might be willing to sell but aren’t listed for sale was Zillow.
Unfortunately, they do not offer the “make me move” service any more.
Even if an owner is not actively trying to sell their home, they may be interested in seeing what kind of money they can make on their home.
That is why sites like Zillow used to offer a “Make Me Move” option, where owners can set a dream offer price for buyers like you that see their home and want to purchase it.
The price requested was usually out of sight but used to provide an avenue for desperate home buyers.
The dream offer is likely to be high, so don’t expect it to be a sticker price that will make you happy. However, you don’t necessarily have to pay the dream price to get the home.
While Zillow has an excellent platform for looking at homes, it also has some downsides.
A couple of issues with the site that real estate agents deal with all the time are homes posted for sale that aren’t on the market and inaccurate home value estimates.
Concerning homes listed for sale that aren’t really on the market, Zillow posts pre-foreclosure homes provided by RealtyTrac. These are properties where homeowners have missed mortgage payments.
They are not homes for sale. Doing this is highly misleading to consumers. The vast majority of these homes never come on the market.
More often than not, the homeowner gets current with their mortgage.
Do Your Research to Buy an Off-Market Home.
One of the more challenging aspects of buying an off-market home is determining what kind of offer you want. You don’t like to offer more than you have to, but you also don’t want to make an offer that will fail to make an impression on the homeowner.
But when you consider that right now, the only thing you know about the house is what you see from driving by it.
The fantastic home you see from the outside could be hiding some unpleasant features on the inside, such as black mold in the downstairs bathroom or rotten flooring from a water leak.
Ideally, you want your offer to account for the reality of what the home is worth, which means you need to do research.
The home may have been previously listed and then taken off the market.
Research can show you when the house was last sold, how much it sold for when it was put on the market, and more. Of course, conducting that research will be challenging if you have never done it before.
It’s why a real estate agent can be so helpful.
An excellent agent can make buying an off-market home a lot easier.
The different steps required to buy an off-market home can be a lot to take, especially if you are doing it all on your own.
That’s why it is recommended that you work with an experienced agent when you attempt to buy an off-market home.
The agent can help you with numerous tasks, like researching the home, approaching the current owner with an offer, negotiating, documentation, finding a mortgage lender, and more.
Remember that buying a home not officially on the market might not have some of the typical documentation a seller would fill out in a traditional sale.
For example, the owner might not have filled out a seller’s disclosure statement if it is an off-market property. Making sure you do your proper home-buying due diligence becomes even more vital. This will be part of their job if you have an exceptional buyer’s agent.
The best buyer’s agents take their job seriously and aren’t a glorified Chauffeur. They are a valuable part of your home-buying team! Don’t accept the poopy-flavored lollipop.
Expect Rejection Searching For Unlisted Real Estate.
Imagine living in a home you love, and a stranger approaches you and offers to buy it.
If you like your home and have had no plans to move, you are likely to tell the stranger to take a hike unless they are willing to offer you a ridiculous amount of money.
It would need to be enough that you would be foolish to say no—then you would probably be annoyed to have to discuss the prospect of selling the property in the first place.
The owner of the home you want to buy is likely to feel something similar.
Not guaranteed—you may be lucky to approach the right person at the right time with the right offer—but you have to expect rejection when you cold call someone about wanting their home.
One of the great things about having an agent represent you is that rejections are easier not to take personally.
Instead of awkwardly approaching a stranger to ask if you can buy their home, you take official channels through a licensed real estate agent and make a business offer.
You can chalk it up to doing business if that offer is declined.
Make Your Offer Contingent on a Home Inspection.
You must avoid making an offer that you will regret later. The property you are so excited about may look perfect from a layperson’s perspective.
But if you make an offer that is then accepted based on your perceptions, you could find out that you’ve purchased a lemon.
In a strong seller’s market with limited inventory, many buyers are tempted to waive their home inspection. In a significant percentage of cases doing so could be a huge mistake.
It is much better to make your offer contingent on a home inspection so that you can change the terms if the examination reveals something of significant concern.
Final Thoughts on How to Buy a House Not on The Market
It is not easy to purchase a home off the market, but it can be done. Take advantage of the knowledge and expertise of your Realtor to ensure that you do everything right the first time.
Finding homes that are not on the market is more challenging but will be worth it if you find a gem.
Additional Helpful Home Buying References
- What does it mean to open escrow – see a detailed explanation to know precisely what the process entails.
- How to know a luxury property is priced too high – understand how you can tell if a luxury home is priced higher than it should be.
- Why purchasing a home from the listing agent is a huge mistake – learn why going directly to the seller’s real estate agent is not wise. Always have a buyer’s agent representing your best interests.
Use these references from other real estate pros to make the best financial decisions when involved in your next purchase and sale.
About the author: The above Real Estate information on buying a home that is not on the market was provided by Bill Gassett, a Nationally recognized leader in his field. Bill can be reached via email at billgassett@remaxexec.com or by phone at 508-625-0191. Bill has helped people move in and out of many Metrowest towns for the last 37+ years.
Are you thinking of selling your home? I am passionate about real estate and love sharing my marketing expertise!
I service Real Estate sales in the following Metrowest MA towns: Ashland, Bellingham, Douglas, Framingham, Franklin, Grafton, Holliston, Hopkinton, Hopedale, Medway, Mendon, Milford, Millbury, Millville, Natick, Northborough, Northbridge, Shrewsbury, Southborough, Sutton, Wayland, Westborough, Whitinsville, Worcester, Upton, and Uxbridge MA.
