Off-market real estate deals have surged in popularity, capturing the interest of high-net-worth individuals seeking privacy and exclusivity. In this article, we delve into the nuances of these transactions, guided by insights from top Los Angeles agent, Sam Palmer. We explore the growing prevalence of off-market deals, particularly since the COVID-19 pandemic—a phenomenon recently highlighted in an article in The RealDeal with The Agency’s Mike Biryla. Read on to discover the unique benefits and challenges associated with this discreet market strategy.
What kind of buyers often partake in off-market purchases?
Titans of industry, Billionaires and sometimes major celebrities. Off-market homes are usually $20M and above so it’s easy to see why these groups fit into the off-market categories.
What trends have you seen with off-market deals? Have they been slowing, becoming more frequent or remaining steady?
These deals are much more frequent. I am seeing more off-market properties become available week by week. In London, nearly all the super-prime properties are transacted off market and we are starting to see a trend shift here in L.A.
Are off-market transactions common in L.A.?
In L.A. they have always happened, but sellers are a lot more comfortable with homes being on the open market in the U.S. The European clients have always been much more reserved with home sales and would rather keep large deals out of the public domain. We are starting to see more and more homes only available off market.
What are the benefits of buying and selling off-market? Why do clients choose to do this?
Privacy is the main factor. In L.A. there is an obsession with agents feeling they have the right to share homes on social media even if instructed not too. By being off market you can carefully hand select the top agents to come and see the home knowing that they will respect the rules and privacy of the client.
What are the cons or challenges of buying and selling off-market?
The biggest challenge with an off-market is exposing the property. Most homes traded off market are trophy listings and will be extremely rare or special. If the home is not particularly unusual but the seller is adamant about keeping the property off market it may be detrimental to the sale.
The other challenge is that a seller may only be willing to sell at an inflated price, so getting a buyer to that price can take time and effort. This goes back to my point of why they are usually trophy assets that are listed off-market.
For more insight into current market trends and the world’s most dynamic real estate destinations, browse our other recent In the Knows: Why Buyers Love Steamboat Springs, Colorado, NorCal Real Estate Market, Santa Barbara & Montecito Real Estate Insights from Eric Haskell, The Rise of Lake Town Real Estate in Tahoe & Beyond, and Today’s Golf Course Home Market, Palm Beach to Palm Springs.
