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John has been trying to sell his £3mn house in the home counties north of London for more than a year. But you won’t find the listing on Rightmove.
“We’re empty nesters,” says the former fund manager. “Two people living in a six-bedroom family house . . . just isn’t right. We do want to sell our property, but we’re under no pressure to move.”
Facing a very slow property market early last year, John took the decision to try to sell “off market” — not letting his agent, Knight Frank, to put the listing online. He asked the FT not to use his real name to avoid blowing this discreet approach.
“The problem of being ‘on the market’ is that if your house is sitting on Rightmove for a year, then people are naturally going to think ‘They must be desperate by now.’ And we’re not desperate,” he says.
However, he was disappointed by the lack of success in drumming up off-market interest. The agents suggested it was time to seek a wider pool of buyers with a public listing, but John is sticking to his guns. This year, he is trying again with a local estate agent.
“Our logic is that if anyone is actually serious about buying a house in this area, they will approach the local agents,” John says.
This logic has long been common in the so-called London “super prime” market, and for some of the top country estates. But the vocabulary and tactics of off- market home sales have increasingly spread outside London to a wider range of properties.
Some sellers, like John, insist on privacy. Agents will also dangle exclusive access to properties before they are widely marketed on platforms like Rightmove and Zoopla in an effort to entice buyers into an early offer.
One in three homes priced above £1mn were not widely advertised last year, according to Hamptons — the highest level since the estate agency started tracking in 2007.
But can copying these tactics from the tiny, rarefied world of super-prime London properties really work for other sellers around the UK?
“The difference is that we transact the highest valued property in the market and therefore have a select pool of potential buyers,” says James Forbes, co-founder of Forbes Gilbert-Green, a private advisory firm specialising in London property valued above £20mn.
“Privacy is key to purchasers and vendors. It is the art of protecting the asset and its value . . . The lower end of the market is much more of a numbers game. As a seller, surely you want to make sure you have the biggest pool of potential buyers having the ability to find your property?” he says.
Trying to cultivate the cachet of an off-market sale can also easily tip into absurdity. Some brokers prepare websites full of off-market listings or splash pictures on social media.
“The term itself is often misunderstood and abused. Off market has come to mean anything which does not have full open-market advertising. But there are many blurred lines here,” says Roarie Scarisbrick, a buying agent at Property Vision.
Nigel Bishop, an agent in Devon and south-west England with 50 years experience in property, says the long-term growth of off-market listings has been a reaction to the rise of online platforms like Rightmove.
Browsing property has become an online pastime, with people spending 15.4bn minutes last year trawling on Rightmove alone, making it the third most popular UK company website, based on page views. Homes that are officially “on the market” have never been more public. And those listings often remain visible online, even after the property is sold.
Working around the online platforms can sometimes bring a tactical edge for sellers on pricing, and benefits for both sides on privacy and timing. But for both buyers and sellers, there are pitfalls — not least the confusion about what an off-market sale really is.
“It has become something that a lot of people say. What exactly does that mean? It’s either for sale or it’s not for sale. So what is off market?” says Bishop. “It has its benefits potentially, but it also has its downsides for both buyers, and sellers actually.”
In reality, the off-market world breaks into different categories, depending on the tactics sellers are using, and the goals they want to achieve.
The very top of the market sees the most truly off-market sales, which are brokered through networks of contacts with zero marketing beyond the discreet call to a trusted agent.
“Off-market deals come to us through various channels, usually agents and owners, but sometimes from yacht brokers, art dealers, chauffeurs and even hairdressers,” says Scarisbrick.
Hamptons estimates that just over half of £2mn-£5mn homes sell off market, with the figure rising to 54 per cent above £5mn. At the top end of the London market, buying agents say over 60 per cent of the homes they help clients buy are never advertised.
This sometimes means approaching the owners of coveted properties that aren’t yet for sale, or scouring the rental market for homes that might be buyable at the right price. At one property in north-west London, buying agent Jo Eccles said the seller initially only offered one viewing to a single prospective buyer — who ultimately bought the multimillion pound house.
“What people say to us is: ‘Look, I don’t want this house all over social media’. Whether it is [to hide it from] parents at the kids’ schools or whatever. They just don’t want it out there,” says Charles McDowell, a prime central London agent.
On top of privacy, sellers also worry about security when posting floor plans online, with pictures that may show the location of valuable artworks or other possessions.
The pool of realistic potential buyers is also quite small. “There aren’t that many people at £15mn plus. The air is quite rarefied,” says McDowell. Working from a little black book of trusted agents and bankers is more effective.
It’s tempting to use the phrase off market to give a whiff of exclusivity to a more straightforward sale. But this can fall flat.
“If the agent says: ‘We are going to create an air of exclusivity’ around a £1.5mn property, just don’t bother,” says Eccles. “You are not going to create an air of exclusivity.”
In the broader property market, listings advertised as off market are often actually in the “pre market” — a soft launch period where agents show properties to a few buyers who are already on their books, before photos and floor plans are uploaded online.
During the property sales boom in the latter part of the Covid-19 pandemic, these early sales were common because agents had long queues of eager buyers and very little stock. “We were selling so much off market because people were begging at our door,” recalls Chris Husson-Martin, head of sales at Hamptons in Salisbury.
Those days are long gone. The sharp rise in interest rates — from near zero in early 2022 to 5.25 per cent by mid last year — put the property market on ice in 2023. Just 1mn homes changed hands during the year, the lowest level in a decade.
This year, more stable mortgage rates have helped the property market find its feet, with inquiries and sales figures gradually rising. In this more tepid sales environment, the pre-market period allows sellers to test the waters.
Playing the pre-market allows sellers two chances to make a first impression. They can offer the house to a small number of potential buyers at a higher price and see if any bite. If not, the property can go up online with a slightly more realistic price tag.
Ideally, this strategy avoids publicly having to cut the price on Rightmove, which tarnishes a property and invites low-ball offers. Hamptons said 30 per cent of homes above £1mn that are initially kept off market ultimately end up on the portals. Below £1mn, it is more than half.
“If you go on to Rightmove all guns blazing, all your cards are on the table. If you are wrong on this price, you will quite rapidly have to reduce it,” says Husson-Martin.
“I’ve said to people: why don’t we dip our toe in the water” by sending a brochure around to registered buyers, he adds. “I do think there is a pre-market, off-market approach that does suit some people. Because the portals are so powerful, it is quite nice to get some initial feedback.”
However, he warned about a third — and less scrupulous — use of the off- market label. Property portals tend to highlight the newest listings. In the past, agents would take their listings offline for just a few days and then repost them to get a fresh kick of attention.
To stamp out this practice, portals such as Rightmove imposed a rule requiring that homes be off the market for 14 weeks before they can be relisted as a “new instruction”.
But during that waiting period, agents may trot out these properties as an off-market opportunity to newly-registered buyers beginning their search.
Husson-Martin says this trick has been particularly common recently, since a larger amount of stock failed to sell last year in the slow market and was pulled off websites.
His advice to buyers is to “ask direct questions” about when listings were last on the open market, to find out if a supposed “off-market gem” is really “just rehashing an instruction you couldn’t sell last year”.
Both buyers and sellers may fret over whether an off-market deal serves their interest. Ultimately, the party that is often pushing the decision is the agent.
Promising an exclusive off-market experience is one way to stand out when pitching for new instructions. By matching a seller and buyers who are already on the agencies’ books — without having to run many viewings — agents may hope for a quicker, easier path to complete the sale and receive their fee. Some agents also fear having their instructions stolen by other brokers once they are public.
And whereas clients are often preoccupied by making sure the final few per cent on the price swings in their favour, those small pricing differences make little difference to the agents’ percentage.
Agents, including those who represent buyers, generally agree that “off market” and “pre market” sales give the seller a slight edge in negotiations, since they can always threaten to throw the property on to the open market and find rival bidders.
Sellers can use the idea of exclusivity to create an artificial sense of urgency. “I think to a greater or lesser extent it kind of works,” says McDowell. “You are creating a kind of bull market out of a bear market.”
Agents suggest starting off-market homes at the higher end of the price the seller wants to achieve. There should still be some level of competition around an off-market sale, says Bishop, “if the selling agent is doing their job properly”.
Husson-Martin says buyers in off-market situations should challenge the agent directly for evidence of similar, recent listings to justify the price.
But the off-market world is not entirely one sided. Buyers benefit from privacy, speed and sometimes a less stressful deal. An early or discreet sale can also be the chance to lock down a desirable property.
Late last year, Bishop took clients to see an off-market country house in Devon. “It was absolutely perfect for them,” he says, particularly because it was a short distance from a school the clients wanted.
The sellers asked for £2.5mn. A deal was reached at £2.3mn. He thinks the home would have lingered if posted on Rightmove, and sold at a lower price. “They paid perhaps £100,000 over,” says Bishop, compared with what it might have been achieved on the open market.
John, the off-market seller, takes what he calls a “somewhat more cynical view” of the strategy.
“We’re not doing it on the premise that someone will pay us more because it’s off market. We just don’t want it to be on a website because we think it will take a long time to sell,” he says. “Off market is most relevant in prime central London. Outside of that it’s just marketing really.”
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