Pocket listings are not illegal if the listing agent fully discloses the pros and cons to the home seller and follows rules that are designed to protect consumers. However, if pocket listings are not handled correctly, the listing office and agent could bear adverse consequences.
CAR has taken numerous steps to help you better understand and deal with off-market listings and to educate consumers about the advantages and disadvantages of pocket listings.
For example, CAR’s Legal Department provides the following resources for REALTORS® dealing with pocket listings:
- Pocket Listings Legal Q&A: New legal article addressing the legal and practical issues involving pocket listings including breach of fiduciary duty, ethics violations, and fair housing and antitrust issues.
- “Demand That Offer Be Presented to Seller” (DPO) letter in the C.A.R. Sample Letter Library through zipForm® 6: A buyer’s agent may use this letter to encourage a listing agent to present the buyer’s offer to the seller.
- As always, you may consult one-on-one with a C.A.R. attorney through our Member Legal Hotline at (213) 739-8282, Mondays to Fridays, from 9 a.m. to 6 p.m., and Saturdays (transactional questions only) from 10 a.m. to 2 p.m.
Other actions CAR is taking to help you and consumers better deal with pocket listings include:
- Upcoming revisions to C.A.R.’s standard form “Seller Instruction to Exclude Listing from the Multiple Listing Service or Internet” (C.A.R. Form SEL) to provide additional information to consumers.
- A special June/July issue of California Real Estate magazine that focuses on ethics and includes a feature story on pocket listings.
- To educate consumers, we’ve prepared numerous communication pieces to submit to the news media, including news releases, an editorial article, and a consumer Q&A.
- To help you educate your clients, we’ll provide you with material including a designed ad and a template news release that you can use with your local media.
- We’ll also produce a brief video to educate buyers and sellers about the pros and cons of pocket listings that you can place on your website or other marketing vehicles.
- Just this week, we hosted a free webinar presented by C.A.R. Senior Counsel Elizabeth Miller-Bougdanos and MLS Listings Chair and C.A.R. Past-President Robert Bailey, who discussed how this growing practice is impacting the real estate industry. If you were unable to participate, you can view the recorded webinar here.
- We’ve taken a leadership role on this issue, meeting with MLS executives throughout the state to share information and develop strategies.
- Lastly, we will continue monitoring this issue and provide you with further support and guidance as needed.