A “pocket listing” is a listing which is withheld from the MLS — kept in an agent’s “back pocket.” Why would a seller want to withhold a listing from MLS exposure, and why would a listing agent promote such a policy?
Although MLS rules require that any listing be put on the MLS within 3 days of signing the listing agreement, a seller’s instruction to withhold the listing from exposure to other agents trumps that rule. The instruction to keep it off the MLS must be included in the listing agreement under “Additional Provisions.”
I myself have had pocket listings for various reasons, and installed a sign in the yard saying “Coming Soon.” I do this when the home is not ready for showing, to alert buyers and their agents about the home so they might choose to wait for it instead of buying another listing. If an agent asks to see it, I will grant the showing after explaining what still needs to be completed, so he and his buyer don’t judge the home on its current condition. Sometimes, to increase such exposure, I will put it on the MLS with the notation, “No showings until _____.”
Another justification for a pocket listing would be if the listing agreement has a reduced commission when there is no buyer’s agent. This can be a win/win — the seller pays less commission, but the listing agent earns a bigger commission.
You might think that when homes sell easily like they do today (if they are priced right, of course) that a pocket listing is the way to go. However, it’s even more important at this time to let everyone know about your home so that you get multiple offers. That means putting it on the MLS. You could end up selling for a price that more than makes up for the higher commission rate.