Why List Properties "Unpriced"?

Question

Does anyone else find it extremely irritating when properties (typically mid-sized to large multifamily lately) are being marketed as "unpriced"? I'd love to hear from experienced brokers who could explain why doing this is beneficial for their client. The first filter most investors use is list price, so it would seem to me that leaving an asset unpriced would mean that you are not even showing up on the radar of a lot of investors, which would obviously reduce your pool of potential buyers.

I am seeing this more and more lately, so I'm sure there must be a good reason for it that I am not thinking of. What am I missing?

Scott M. · Answer

You are used to filtering out deals based on the sales price. The seller in this case is filtering you out. These sellers are doing exactly what they want to do, not waste time with tire kickers and new investors. You (the new investor) see's this as a waste of time and don't bother. The seller and the sellers agent says thank god they don't have to waste time with you. (not you specifically of course). You self filtered yourself out and that is 100% what it is supposed to do. They are targeting a specific type of buyer. One that is generally very experienced. One that is comfortable looking at the deal, at the deal numbers and saying I will pay X for it based on the numbers, not based on the sellers number.

Joe Villeneuve · Answer

I have the answer. Yes,...and yes.Yes, it's dumb idea for the listing agent to not list the price because it does eliminate the prime filter when doing a property search.No, as far as I'm concerned (if I can find the property), it's a great idea for me...as an investor. I don't worry about the asking price to set my price. I base my offer on the numbers. All the seller is doing is giving me control of the process since I get to set the starting point.

Scott M. · Answer

Meant nothing personal as I have no clue if you are new or not. I am afraid no matter what word is used may be taken in the wrong context. As @Russell Brazil used the word "serious" that is another word. That isn't to suggest that you are not a serious buyer. Although I have used the same word in the past with clients when describing this sort (or similar) deal.You asked for feedback on why this is done and what the good reason is. In my experience that good reason is so certain types of buyers will filter themselves out and not waste the sellers or their agents time with questions those types of buyers normally ask.

Charles Scott · Answer

@Owen Dashner he who names the price first loses I guess

Russell Brazil · Answer

I close deals all the time both on the list and the buy side where there was no advertised price. Most of the deals tend to close pretty easily. Usually the buyer tends to be a serious buyer, and the seller is a serious seller, and each ends up pretty close on price as a starting point because of that.

Colleen F. · Answer

@Owen Dashner I never understand why would you want to make it harder for someone looking at your rental. Why should they have to call to find out the price? I do see when this happens that they may show up on searches with a price range and it drives you to the complexes site for the most part.

Account Closed · Answer

Currently, we are in a sellers market. This could indicate that a seller maybe isn't properly motivated, and is merely fielding some offers to see what's out there.This could be a good opportunity, as yes, it does limit their visibility in search results, but it also allows you to give an offer based on exact numbers, not the price they'd set ahead of time.

Scott Mac · Answer

Obviously the Seller believes they will get more money on the sale (for whatever reason) Personally I think 2 tings when I see this. [1] the Seller is covering for some weakness in negotiating (and it might rightfully be so); or [2] Seller is going to be Cantankerous in negotiating (ie. believes SFH lived in for decades is worth 4 times what it's worth because places in the good part of town sell for a lot more, and refuses to factor in the "Decline" their own neighborhood has had since 1959 when they bought it), and the Agent wants to list it hoping the seemingly-lowball offers will wake the Seller up as to it's true value). Just my 2 cents.

Amber Gazzolo · Answer

@russellbrazil Sorry to bother you but during some research I came across this discussion. I just found an unpriced 4 plex that I am interested in. I have a few single family but looking for a 2-4 plex house hack (i.e. not very experienced yet with multifamily). Do you have any advice on how to handle the broker for an unpriced listing? Thank you!

Owen Dashner · Answer

@Scott M. what you said makes some sense. What's weird though is that a lot of these "unpriced" listings have no other financial information listed for an investor to do initial underwriting on. So, if the point is to weed out investors that are tire kickers, you'd think the listing broker wouldn't want 1000 inquiries asking for the financials/OM.I guess the better question that I should be asking is, how can an experienced investor best use these types of listings to their advantage?