Off market sales became popular when Sydney’s property market was white hot.
We explore whether they’re as relevant in today’s property market.
The rise of off-market property sales in Sydney’s eastern suburbs
Off market sales have always existed. But they started to become a standard feature of the Sydney property market in the strong conditions that existed between about 2013 and 2017.
That’s because going off-market has always been a strategy that tends to work very well in tight property markets, especially for high-end properties. With limited supply and enough interest in a property, it can let a seller cut straight to the people most likely to buy without the need to go through a lengthy public market campaign.
It also lets them retain control and privacy. If they don’t achieve the price they want and are in no rush to sell, they can always withdraw from the market without any public record that it was ever for sale.
What’s happened to off-market selling lately?
The downside of off-market selling is that it generally requires an existing pool of interested buyers. That means, as a seller, you’re reliant on your real estate agent to have the right contacts and to understand their requirements, as well as what they value in a property and what they’ll put their best for forward to buy.
For this reason, some sellers are more hesitant to list off-market when the property market is flat, reasoning that this is exactly when advertising needs to be more wide-reaching and more elaborate, so the net is cast as wide as possible. They also think buyers will go into a transaction thinking they don’t want to overpay, especially without the “social proof” of an auction.
In theory, that sounds reasonable. In practice, we disagree. In fact, we think that a market such as this one is actually the very best times to list off-market.
How off-market listing works in a slow market
For instance, in Sydney’s property market, the summer break is usually considered the slowest possible time. It’s when people are more interested in socialising, holidaying or relaxing than in property and fewer people are in town to visit open homes. But, actually, this is the perfect time for off-market sales.
When people are looking at property in late December and early January, you know they’re serious buyers. And yet, there is little stock on the market – sometimes virtually none.
As a seller, you can be confident you’re showing your home to genuinely interested people who want to make a move but can’t find anything that meets their requirements. If yours does, they’re often motivated to make a strong offer.
Off-market listings this year
The reality of the current market is that even though there are usually fewer buyers than 18 months ago, there are also fewer properties for sale. The buyers that are in the market are usually motivated but discerning.
Because stock levels are low, there is often not much out there that matches their criteria.
In this market, we’re actually having more success with off-market sales than ever before. In fact, so far in 2019 44% of all our sales have been off-market. In the past quarter, it has been a massive 66%.
If you’re considering selling and your property has the kind of characteristics discerning buyers are looking for, we think you should strongly consider listing off-market.
After all, the lack of stock is one of the defining factors in the Eastern Suburbs real estate market right now. If you’re willing to price your property correctly, you will attract interest. At the same time, you’ll have all the benefits of privacy and convenience that an off-market listing brings.
If you’d like to know more about whether listing off-market is right for your property get in touch.
Sydney’s Eastern Suburbs Market Snapshot
A detailed annual assessment of the property market focusing on the Eastern Suburbs of Sydney, Australia.