Australia’s residential property market is thought to be pretty transparent in large part because thousands of homes are popping up online on all the main real estate websites each and every day. Despite all that visibility, it’s a pretty common occurrence for a whole bunch of property sales to go down without ever getting a listing anywhere or any kind of advertising. That’s what are known as off-market and pre-market properties, a section of the market that regular buyers don’t get to see through the usual channels. Industry people reckon between 5% and 20% of all property deals in Australia are done through the back channels. Where you live, what kind of house you are looking at, and what’s going on in the market all have a bit of an impact on that.
Knowing the Difference, Off-Market & Pre-Market Listings
A lot of people use the terms off-market and pre-market pretty much interchangeably, but actually they refer to different bits of the sales process. An off-market property gets sold in private without so much as a whisper to the general public. It’s not going on any of the big property sites. There are no public open homes scheduled. Only a handful of possible buyers get to see it, usually through some very established professional networks. Then there’s pre-market properties. Those are sold differently again. They get advertised eventually, but not right away. Before the big marketing campaign goes public, the owners will put the word out privately to find a buyer. Australia’s buyers and sellers are lucky in that the buyer’s agents here often have long-term relationships with the selling agents. This lets them hear about upcoming listing days or even weeks before it goes public. That’s where businesses such as Elite Buyer Agents can really give individual buyers a leg up, as having an expert on your side can give you access to opportunities the general public just can’t get to. Research shows that sometimes pre-market properties can become available 7 to 14 days before the public gets the chance to see them. This lets buyers get in early, in markets that are super competitive.
Why Sellers Just Decide to Keep it Under Wraps?
Not everyone thinks it’s true that every seller out there wants the world to know they’re selling. Lots of vendors actually choose to sell privately because that’s just a better fit for their financial situation, personal life, or whatever other reason they might have. High-end property sellers often want to keep things on the down low so as not to draw too much attention. Landlords might prefer to keep some investment properties off the radar, especially if they have tenants in place. They don’t want the hassle and disruption of a whole bunch of inspections and open homes. Market conditions have a lot to do with this too. In Australia just recently, the housing market was really hot and the number of properties sold went up while the number of properties for sale went down by almost 15%. In a tight market like that, the selling agents are often just able to find someone to buy the house without having to pay out big dollars for advertising. That’s where some vendors, like the big money folks, just decide to avoid all the marketing costs. Those costs can be thousands or tens of thousands of dollars, depending on where the house is and what kind of marketing the seller wants to do.
The Network Advantage Buyers Agents Have
Hidden house opportunities are waiting to be snapped up because of professional relationships rather than tech. Buyers’ agents take years building up good relationships with selling agents, developers, property managers and people who own homes privately. These connections keep churning out information that’s often not available to people searching for a house on their own. Industry analysis says that around 15% to 20% of Aussie residential property sales come through channels that aren’t open to the public. In some big cities, that figure can go even higher if there’s not much housing available. Selling agents often need to find a buyer fast. They often reach out to trusted buyer’s agents before putting a house on the market. This means a relatively small group of pre-qualified buyers get a chance to look at homes that will never be listed publicly.
Are Hidden Listings Actually a Better Deal?
A lot of Aussies think that if a property isn’t on the public market then it’s automatically cheaper. The truth is more complicated. Evidence suggests that just because a house isn’t publicly listed doesn’t mean it’s automatically cheaper. Some people in the industry say that private sales can be done at 10% to 20% less than what comparable public listings are going for, especially if the vendor really values their privacy, a quick sale or getting a more certain outcome from the sale. Other market watchers have seen cases where off-market listings end up selling for more than the comparable market value. Having fewer buyers means you can’t get a good feel for what a house is really worth.
The Transparency Debate Over Hidden Property Markets
Private sales can benefit both buyers and sellers, but they keep on sparking debate over how transparent the housing market is in Australia. Public property sites give every buyer access to all the listings. Off-market sales limit that to a much smaller group.
