Agents share dueling opinions on off-market listings

Hidden gem or missed opportunity?

For Willoughby, founder of The Jaymes Willoughby Team with Keller Williams Realty, off-market listings are a gamble that rarely pays off for sellers.

“I’ve yet to see convincing data that says keeping a home off the market nets a better deal for the seller,” Willoughby said. “We have a fiduciary obligation to expose their home to as many buyers as possible to get the highest and best price. Why would we hide it?”

Willoughby said his team only considers off-market sales under specific and rare conditions — such as when a property needs significant repairs or the seller has privacy concerns — but he’s wary of agents using the method to drive dual agency transactions or cultivate exclusive buyer lists.

“Let’s be honest. Some agents use off-market listings as a way to double-dip commissions,” Willoughby said. “It’s not about strategy. It’s about control. That’s not looking out for the seller — that’s looking out for yourself.”

Coleman, owner and broker at HomeSmart ICare Realty, agrees.

“There’s this narrative that exclusivity brings better deals, but in most cases, that’s just not true,” Coleman said. “You’re artificially limiting your market. Why would a seller agree to that unless they were misinformed?”

But not everyone sees the off-market strategy as inherently problematic.

Dombrowski, co-founder of the D-Ski Monarch Group under HomeSmart Connect, believes that when used ethically and transparently, off-market listings can be an effective tool — especially in a high-demand market where properties move fast.

“There are times when an off-market deal makes total sense,” Dombrowski said. “Maybe a seller wants privacy. Maybe they’re doing renovations and don’t want showings yet. Or maybe there’s a buyer in the agent’s network ready to go. It doesn’t have to be shady.”

Dombrowski says his team has closed several successful off-market deals that satisfied both parties.

“We’re very clear with our sellers,” he said. “We tell them, ‘If you want maximum exposure, we go on the MLS. But if you want to test the waters first or sell quietly, we can try it off-market with a set deadline and see what happens.’ It’s about giving them options.”

Novakovic, a Compass Real Estate agent, offered a case study to demonstrate benefits of keeping listings private.

A couple separating was looking to sell their large Victorian double lot home discreetly. With children, they did not want neighbors to know they were selling until they spoke to their kids, she said.

“They listed as a Compass Private Exclusive with a single photo and a description,” Novakovic said. “They moved on to the next phase since they didn’t get requests for showings. In the next phase, Compass Coming Soon, they got requests for showings, but the home was not ready to be shown. They took time to declutter before going on the public market, where it sold to a buyer who had been looking for a home for two years.

“The buyers got their dream home, and sellers were satisfied since the offer was higher than the appraisal they had received a few months earlier, and they still maintained a low profile.”

A fiduciary line in the sand

To Willoughby and Coleman, what’s presented as “options” must still be bound by a clear moral compass. “I’m not saying off-market sales are never appropriate,” Coleman said. “But let’s not pretend they’re usually in the best interest of the seller. Our first duty is to the client, not our commission.”

Willoughby went further, saying “you can’t serve two masters. If you’ve got both sides of the deal, there’s a conflict. And, if you engineered the deal off-market to control both ends, you’re skating on ethical thin ice.”

Both agents said while the occasional off-market transaction may serve a specific seller’s need, a pattern of such deals should raise red flags.

“If your brokerage is doing off-market deals regularly, that’s not a strategy — that’s a business model,” Coleman said.

Dombrowski urges critics to consider the full context.

“There are legitimate reasons sellers want privacy,” he said. “It could be a divorce, a job transfer, or health concerns. If they ask for discretion, it’s our job to honor that while still trying to deliver a great outcome.”

Dombrowski added that many of his clients appreciate being able to test a price point or make improvements without the pressure of showings and public scrutiny.

“We’ll do a quiet marketing period,” he said. “Maybe we’ll reach out to our top buyers and see what kind of feedback we get. It’s part of our consultation process.”

Clear Cooperation and a shifting landscape

The National Association of Realtors’ (NAR) Clear Cooperation Policy was aimed at curbing unchecked growth of off-market sales and promoting transparency — but enforcement and interpretation vary.

NAR’s recent new option for sellers — Delayed Marketing Exempt Listings — allows sellers to delay public marketing of their listings through IDX and syndication, while still having the properties listed on the MLS and accessible to other MLS participants.

Coleman sees the rule as an overdue check on unethical practices. “Off-market listings exploded for all the wrong reasons,” he said. “It started to look like agents were hoarding properties instead of marketing them. That’s not professional. That’s predatory.”

Dombrowski supports the policy but worries about its rigidity.

“The spirit of the rule is good, but it shouldn’t box sellers in,” he said. “There should be flexibility for legitimate off-market needs, and agents should be able to offer that pathway without fear of getting slapped with a violation.”

Willoughby believes the rule doesn’t go far enough.

“If we’re serious about transparency and competition, the MLS should be the standard for everyone,” he said. “Letting deals happen behind closed doors is the opposite of fair play.”

Novakovic offered another example of an off-market listing benefitting clients.

An out-of-state client wanted to sell his investment property but did not have time to fly to Chicago. Novakovic worked to prepare the property and cleared and donated items to a local non-profit. Because it was December, other sellers waited until the weather was nicer to list.

“This home was listed as a Compass Private Exclusive, and they received showing requests without any photos,” she said. “Given the interest, they raised the list price by $25,000 with no price adjustment history. They received a full-price offer at the higher listing price, and the client was pleased with the price, timing, and terms.

“They closed within 30 days, and the seller never reached Chicago. The buyer was also happy since the timing worked perfectly as their current lease ended.”

Buyers in the balance

Willoughby and Coleman said buyers can be disadvantaged by off-market deals — particularly those without direct access to an agent with exclusive leads.

“Off-market deals are great for cash buyers or flippers who have insider access,” Willoughby said. “But what about the average family using an FHA loan? They don’t even get a chance to make an offer.

“Real estate isn’t a secret society. It’s a public service.”

Coleman added, “The broader the exposure, the more equitable the process. That’s why the MLS was created in the first place. When you take homes off the grid, you leave out whole segments of the market.”

Dombrowski sees it a bit differently. “It’s our job to represent our clients, not fix the system,” he said. “If a seller wants a private deal, and I’ve got a qualified buyer, why not bring them together? It’s not my job to level the playing field for every buyer. (My job is) to do what’s right for my client within the rules.

“It’s not black and white. Off-market deals aren’t inherently wrong. They just need to be handled with care, honesty, and transparency.”