In recent years it’s grown increasingly popular to put up a “coming soon” sign before a home officially hits the Multiple Listing Service (MLS). As a buyer, can you benefit from a “coming soon” home?
How “coming soon” listings work
You’ve probably seen “coming soon” signs in the yards of homes that are about to go live on the MLS. This strategy is most prevalent in hot markets with more buyers than sellers. Displaying a “coming soon” sign lets a seller get a jump on other homes by generating buyer interest before the house is officially for sale. During this pre-listing time, buzz builds as the seller cleans, completes repairs, and stages the property.
Regulations in many states set a maximum amount of time a house can be labeled “coming soon” before it officially hits the MLS, usually a couple of weeks.
A buyer can make an offer on a “coming soon” house, but there are some restrictions on how the listing agent can promote the home.
Turn “coming soon” status to your advantage as a buyer
When you see a “coming soon” sign in the yard of a house you love, speak with your agent right away. The listing agent for the house may have uploaded photos to a private website — not the MLS — which you can review to decide if the home is right for you. Your agent can pull comparable closed sales for the area so you can be crafting a well-researched offer. That way you can be ready to tour and submit an offer the day the house appears on the MLS. Your early knowledge about the property will have given you a jump on competing buyers.
Crafting a smart offer is vital in a “coming soon” situation. You don’t want to pay too much, but this is not the place to lowball. Doing so will likely mean your offer is brushed aside as other buyers show up who are willing to pay more. And it’s not all about the price, either. You can strengthen your offer by submitting a mortgage pre-approval letter and earnest money check along with it and by offering to pay some closing costs that the seller usually assumes.
Be aware that a smart seller likely won’t pounce on your offer the moment you submit it. Instead, she will want to expose the house to the market for at least a couple of days and perhaps go forward with an open house to gauge interest. This will help her determine how best to respond to your offer.
It’s wise to give the seller of a “coming soon” house two days or so to accept your offer. This gives the seller time to expose the house to the market, but she’ll know she cannot string you along.