MINNEAPOLIS — House hunters frustrated with the market’s supply of homes have shifted their search from the streets to underground.
More buyers are targeting homes that haven’t yet hit the market, a trend agents say will grow as inventory shrinks and the mismatch of what’s available and what’s desired continues.
Such back-pocket deals used to involve mostly luxury homes where buyers and sellers wanted to keep the sale hush-hush. But lower-priced houses are becoming a bigger part of the mix because they are in short supply.
A tight supply of homes is creating a buyer’s market in some market segments. Denver is No. 2 in the nation for the shortest length of time that a home is listed before being sold — 33 days — far below the national median of 89 days. Real estate agents attribute that to high demand and too few homes on the market that match buyers’ needs.
Working behind the scenes gives buyers access to the deep well of homeowners who would like to sell but don’t think the market is healthy enough to list. Agents say they identify these sellers through referrals. There also are buyers who work with agents to make unsolicited bids on homes.
“There is a shadow market out there with a lot of people who want to sell,” said Joe Grunnet, a broker in Minneapolis. Homeowners “just don’t know they can sell in this market.”
Housing experts say there is a robust stash of homes that aren’t on the Multiple Listing Service. CoreLogic says that for every two houses available in the United States in January, there was one in the “shadow,” or not yet on the market. There’s also a deep overhang of prospective sellers who have decided to rent their homes rather than sell.
Mike Blood, who struggled to find a $150,000 to $200,000 home, recently caught a break. He spotted a construction Dumpster in front of a house in Blaine, Minn., that he saw during an earlier hunt.
After learning it was being readied for resale, he and his agent made an offer.
“I was so frustrated,” said Blood, who expects to close on the home next month.
Graham Smith, the agent who helped Blood, said that in some ways, these premarket deals are simply a return to the basics.
“It’s good old-fashioned networking, that’s all it is,” he said.
The Denver Post contributed to this report.
Where to find a behind-the-scenes deal
• Most real estate companies have an internal, premarket listing service. Some companies also have public forums where buyers can say what they’re shopping for.
• Real estate agents who specialize in particular neighborhoods usually know what’s coming on the market long before it’s public.
• In condo buildings and townhouse communities, many deals have been done by distributing wish-list letters to residents.
Where to look
Finding a behind-the-scenes real estate deal:
Most real estate companies have an internal, premarket listing service. Some companies also have public forums where buyers can say what they’re looking for in a house.
Real estate agents who specialize in particular neighborhoods usually know what’s coming on the market long before it’s public.
In condo buildings and townhouse communities, many deals have been done by distributing wish-list letters to residents.
