What Is a Pocket Listing? Risks, Fair Housing and What Buyers Need to Know

The way listings are marketed is a topic of serious concern. A pocket listing or office exclusive listing refers to a situation where the seller agrees to limit access to their property exclusively through the listing agent or brokerage.

What Is a Pocket Listing?

A pocket listing is a property that is for sale but is not publicly advertised through the Multiple Listing Service (MLS) or other broadly accessible platforms. Instead, the listing agent markets the property privately—often within their own network or to a select group of buyers.

The term "pocket" refers to the idea that the listing is being kept "in the agent's pocket" rather than shared openly with the wider real estate community.

Why Sellers May Consider Pocket Listings:

Privacy: High-profile sellers may not want the public to know they’re selling their home.

Exclusivity: Some sellers may believe keeping a property exclusive creates a sense of prestige or urgency among buyers.

Why Pocket Listings Can Be Problematic:

Seller Instructions for Limited Marketing: To agree to an office exclusive or pocket listing, the seller must sign a disclosure which reads, in part-

“I understand that, if I choose not to promote my home through Bright’s multiple listing service (MLS) on an impartial basis to the area’s brokers and homebuyers, then I am potentially leaving money on the table: A 2023 study showed that homes promoted through Bright’s MLS sold for more on average than similar homes not promoted through Bright. 

_____ I understand that not allowing Bright to distribute my property’s information to other brokers and the public will substantially reduce the number of potential buyers/renters and real estate agents who can learn about the property.”

Fair Housing and pocket listings:  The Fair Housing Act enacted in 1968, prohibits discrimination in housing based on race, color, national origin, religion, sex (including gender identity and sexual orientation), familial status, or disability. 

A pocket listing most definitely raises fair housing concerns.  

Who decides who has access to a pocket listing? 

Does this limited access exclude protected classes from equal opportunity?

The lack of broad marketing can negatively affect one or several protected groups. 

Regulators and fair housing advocates argue that open access to housing opportunities is essential for an equal and fair market.

Pocket Listings may encourage bad practices in real estate

My clients recently went to an open house in Old Town Alexandria. The listing agent at the open house, who is representing the seller/owner of the property, tells my clients there is a better listing down the street. The agent offers to show my clients a pocket listing saying “I’m showing this property to select people.” 

What criteria is the agent using to “choose” buyers? Do the seller clients of both houses know their agent is acting in this manner? 

Unless specifically directed otherwise by clients, the agent has violated fiduciary duties to the open house seller and the pocket listing seller. In addition, the agent has likely violated fair housing laws. 

Regulators and fair housing advocates argue that open access to housing opportunities is essential for an equitable market.

If you have questions about pocket listings, fair housing or other real estate related issues, contact Victoria@homebuyerbrokerage.com

‍

How can we help?

The exclusive buyer agents at HomeBuyer Brokerage specialize in serving home buyers. Please reach out with questions at info@homebuyerbrokerage.com.