Hip Pocket: About the Only Way You Are Going to Find a Home in Dallas Right Now…
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I’ve told you all about Hip Pockets, right? Well, get used to hearing this term more and more if you are buying a house in Dallas. Our market is not just hot, it’s sizzling. Homes are selling even before they hit MLS. Not only is that a huge status symbol for your house, but it is tickling the brokers to death as they grab both sides of the deal AND skip over a whole lot of marketing costs.
Even the FSBO’s (for-sale-by-owners) are selling: Case in point: 3516 St. Johns. Sold!
That’s why we are offering a new thingee here on CandysDirt called Hip Pocket. Our tech geniuses are busy at work creating a little box you can just fill in, but in the meantime, just send me your hip pockets much the same way you hotsheet them around your office: via email message to [email protected]. Try to send a photo, too, even if you just take it with your smartypants phone.
Here’s one that was a hip pocket on March 25, now under contract:
Hip pockets are homes that are marketed on the down low. They are not listed in the MLS, but the sellers will sell when presented with a contract, the right contract.
Last year, Steve Brown wrote about hip pockets for the very first time. He said the number of such off-market home deals has ballooned as the number of properties available for re-sale has declined in Dallas-area neighborhoods. Hottest areas for hip-pockets: affluent areas such as North Dallas, Highland Park and Lakewood.
Amy Detwiler, an agent with Briggs Freeman Sotheby’s International Realty, estimates that 30 percent of the sales in her office are hip-pocket transactions, and agents at other firms say it’s more like 40%. These may be buyers who want privacy, but privacy never goes hand in hand with selling something unless you have enough people in your influence sphere to find a buyer without having to go to the “common” marketplace.
“We rely on our Realtor network to get the word out for hip-pocket listings,” Karen Luter of Allie Beth Allman and Associates told Steve; most brokers have hot sheets, and they get spread around at Realtor networking groups and, increasingly, on FaceBook pages.
Well, now you can spread them here. We don’t even need addresses, just how to get in touch with the agent with the bulging hip pocket!
Hip pockets, as you know, are not for every listing. Karen’s Mary Kay Ash listing is not one to keep mum on — the more people who know about this home, the better.
(And why has the company not moved to buy it?)
“If they have a great property, they can give it a (hip pocket) shot,” she told Steve Brown. “But the property has to be very unique — it has to be best in show.”
Agents tell me that we will see more hip pocket listings because there are so few homes on the market. It is a seller’s market, no doubt, and this happens when sellers have the upper hand: they can chose to aggressively market or sit back, wait for the buyers to come to them with chilled bottles of Veuve Cliquot. The inventory stats vary across North Texas from neighborhood to neighborhood, but overall there is about a 4 month supply of inventory, less than that in hot areas such as Lakewood, Bluffview, Preston Hollow and Park Cities.
There are almost 2 million home listings in Realtor.com, the National Association of Realtors’ primary marketing site, which gets it’s listing info straight from its 850 MLS partners, North Texas included. That information is then filtered out to every agent with access, as well as the Trulias and Zillow’s who make the information available to the general public. But if you note that the info on these sites tends to be a bit old, you are correct. In a hot market like the one we currently enjoy, data can change in the 24 hours from the time the photos were uploaded to the time Zillow boys scoop up the listing.
By then, it can be sold.
For the freshest info, you need the ear of the agent. And in this market, you need a sharp agent by your side 24/7 more than at any time…
Have you heard about the "Hip Pocket" market? It's booming according to Candace Evans on Candy's Dirt. Jeff Updike and Weston Pugh have 6108 Palo Pinto Avenue under contract and it was not even on MLS!
Do you think a hip pocket listing is in the best interest of the selling client? The MLS gives it the widest possible exposure to the market.
Privacy and security concerns keep some sellers from wanting to list their property on MLS.An experienced agent with an extensive network can deliver a buyer without publicly listing a property.
"Privacy and security concerns" is a weak argument IMHO. Tom Leppert and T. Boone Pickens both have their homes on the market. If anyone could use that argument it would be them. Why did they choose to list their homes in the MLS? I'd be curious to know their reasoning. I think Hip Pocket listings allow a seller to test the market without losing valuable DOM in the MLS. Hip Pocket listings reduce exposure and from an economic perspective, this isn't a good thing. I'm still waiting for a good counter to that point.
Have you heard about the "Hip Pocket" market? It's booming according to Candace Evans on Candy's Dirt. Jeff Updike and Weston Pugh have 6108 Palo Pinto Avenue under contract and it was not even on MLS!
Do you think a hip pocket listing is in the best interest of the selling client? The MLS gives it the widest possible exposure to the market.
Privacy and security concerns keep some sellers from wanting to list their property on MLS.An experienced agent with an extensive network can deliver a buyer without publicly listing a property.
"Privacy and security concerns" is a weak argument IMHO. Tom Leppert and T. Boone Pickens both have their homes on the market. If anyone could use that argument it would be them. Why did they choose to list their homes in the MLS? I'd be curious to know their reasoning. I think Hip Pocket listings allow a seller to test the market without losing valuable DOM in the MLS. Hip Pocket listings reduce exposure and from an economic perspective, this isn't a good thing. I'm still waiting for a good counter to that point.
great idea.
great idea.
I completely agree with the comment below. As a listing agent we have a fiduciary responsibility to procure as many offers on our client's house. Perhaps hip pocket marketing properties is hurting our clients rather than helping them get the best price for their property.
I completely agree with the comment below. As a listing agent we have a fiduciary responsibility to procure as many offers on our client's house. Perhaps hip pocket marketing properties is hurting our clients rather than helping them get the best price for their property.
Oh this concerns me a great deal. How will we be able to get accurate stats?
Oh this concerns me a great deal. How will we be able to get accurate stats?
Candy-I am holding a hip pocket because for school timing reasons-the Sellers can't move for 60+ days. We intend to put the home in MLS either once the house receives a contract (as a hip pocket) or in a few weeks as a regular listing. I will definitely add it to MLS so the comps can be added to improve the average sales in Area 12. I have released the listing as a hip pocket to my networking groups since the inventory is so low-at least Buyer's agents can present it to their buyers as a soon to be available property. The biggest issue is agents are NOT CHANGING STATUS and wasting our time with our buyers in an already limited inventory market.
I had a seller recently who wanted to limit the number of showings for personal reasons. I circulated the listing among several brokerages and my network of agents, it went under contract quickly but I definitely put it into MLS.
Candy-I am holding a hip pocket because for school timing reasons-the Sellers can't move for 60+ days. We intend to put the home in MLS either once the house receives a contract (as a hip pocket) or in a few weeks as a regular listing. I will definitely add it to MLS so the comps can be added to improve the average sales in Area 12. I have released the listing as a hip pocket to my networking groups since the inventory is so low-at least Buyer's agents can present it to their buyers as a soon to be available property. The biggest issue is agents are NOT CHANGING STATUS and wasting our time with our buyers in an already limited inventory market.
I had a seller recently who wanted to limit the number of showings for personal reasons. I circulated the listing among several brokerages and my network of agents, it went under contract quickly but I definitely put it into MLS.
Wish you had posted this about 2 weeks ago! We just listed our preston hollow home at 6028 Northwood Rd. yesterday. It is our old house and we have been renting it for almost 4 years while we waited for the market to improve. After reading your post, I am hopeful that it will sell fast!
Wish you had posted this about 2 weeks ago! We just listed our preston hollow home at 6028 Northwood Rd. yesterday. It is our old house and we have been renting it for almost 4 years while we waited for the market to improve. After reading your post, I am hopeful that it will sell fast!
@Jeff, I'd presume there's a listing-price threshold where the hip pocket strategy doesn't make sense due to limited demand (e.g. exlcusive properties > ~$3-$5 mm), and therefore the seller has to cast a wider net. However, at price points with higher demand and limited supply, a well-networked seller and savvy realtor can leverage this approach and command a very strong offer.
I agree with others that this strategy could result in not maximizing the best possible offer, but then again, everything has a pro and con that an effective realtor will address up front so the seller can make an educated decision. Though hip pockets are typically the best of the best at their respective price points, commanding top dollar.
@Jeff, I'd presume there's a listing-price threshold where the hip pocket strategy doesn't make sense due to limited demand (e.g. exlcusive properties > ~$3-$5 mm), and therefore the seller has to cast a wider net. However, at price points with higher demand and limited supply, a well-networked seller and savvy realtor can leverage this approach and command a very strong offer.
I agree with others that this strategy could result in not maximizing the best possible offer, but then again, everything has a pro and con that an effective realtor will address up front so the seller can make an educated decision. Though hip pockets are typically the best of the best at their respective price points, commanding top dollar.
The most cogent argument AGAINST "hip pockets" is that the home is never really on the market and there is no way one can argue that the seller got the highest and best price. It is a benefit to the listing broker, not the seller. It is amazing how the desire for status skews the conclusions of the best business minds!
The most cogent argument AGAINST "hip pockets" is that the home is never really on the market and there is no way one can argue that the seller got the highest and best price. It is a benefit to the listing broker, not the seller. It is amazing how the desire for status skews the conclusions of the best business minds!
candy, you "hip pocket listings are tickling the brokers to death," but I would suggest all those "tickled" brokers are going to go to real estate hell when they die. In hell they will be tormented by the ghosts of past seller clients chanting "I could have made a bigger profit on my house if it had been marketed properly in the MLS."
candy, you "hip pocket listings are tickling the brokers to death," but I would suggest all those "tickled" brokers are going to go to real estate hell when they die. In hell they will be tormented by the ghosts of past seller clients chanting "I could have made a bigger profit on my house if it had been marketed properly in the MLS."
[…] why would a REALTOR suggest this course of action? I think Candy Evans of CandysDirt.com summed it up […]
[…] why would a REALTOR suggest this course of action? I think Candy Evans of CandysDirt.com summed it up […]
[…] I mean, dang! Dallas home prices are up 7.1% from last year overall. Is that not great to hear? Prices of pre-owned homes scooted up a whopping 7.1 percent in February from February 2012, a record increase. Like, the biggest increase since Case Shiller has been keeping records. Talk to the agents, they say North Texas home prices are up about 8 percent over the first three months of 2012, according to the MLS. And many sales are being made outside of the MLS. […]
[…] I mean, dang! Dallas home prices are up 7.1% from last year overall. Is that not great to hear? Prices of pre-owned homes scooted up a whopping 7.1 percent in February from February 2012, a record increase. Like, the biggest increase since Case Shiller has been keeping records. Talk to the agents, they say North Texas home prices are up about 8 percent over the first three months of 2012, according to the MLS. And many sales are being made outside of the MLS. […]
To be frank, there simply is no rational argument for hip pocket listings, from a financial perspective. Anyone who says a well-connected broker can consistently command a strong offer is deluded. Might such a broker get the best price possible for the client? Sure. They might happen to run into the one buyer who was going to offer the high bid. Statistically, it is impossible that such a broker would be able to reach the same audience, and thus, the same potential demand and price, as the MLS. Privacy is generally an irrelevant argument, as special conditions for showing, etc can be easily written into an MLS listing. Timing isn't a relevant matter, either, as the same stipulations can be applied. If an agent has a fiduciary responsibility to the client, hip pocket listings are essentially equivalent to a doctor ignoring his oath to care for his patient. But apparently it's what the cool kids are doing.
To be frank, there simply is no rational argument for hip pocket listings, from a financial perspective. Anyone who says a well-connected broker can consistently command a strong offer is deluded. Might such a broker get the best price possible for the client? Sure. They might happen to run into the one buyer who was going to offer the high bid. Statistically, it is impossible that such a broker would be able to reach the same audience, and thus, the same potential demand and price, as the MLS. Privacy is generally an irrelevant argument, as special conditions for showing, etc can be easily written into an MLS listing. Timing isn't a relevant matter, either, as the same stipulations can be applied. If an agent has a fiduciary responsibility to the client, hip pocket listings are essentially equivalent to a doctor ignoring his oath to care for his patient. But apparently it's what the cool kids are doing.