Not all sales are Publicly Listed or Marketed. Private Sales occur
quietly all the time. They may or may not have involved the participation
of a Realtor.
Private Sales typically do not affect Market Value as much as the prices
of Properties that are listed in the MLS, because fewer people are
aware of the Sale.
of Properties that are listed in the MLS, because fewer people are
aware of the Sale.
However, all Sales information becomes part of Public Records, and the information is always accessed by appraisers when they work in the area.
So, the Sale Price might not influence a Buyer’s opinion of value,
but the Sold Price of all recent sales will factor into the appraisal
of all neighboring properties.
They tend fall into three categories:
1] Distress Sale: Usually involves some form of financial default,
Bankruptcy or Foreclosure. But the Property Owner works out
a Sales Agreement privately with his creditors. Usually these
sales Close at a price below market value. And unless you are
a principal in the transaction, you will never know the circumstances.
2] Private Party approaches an Off- Market Seller with an Offer.
He may have no reason to believe the owner wants to sell, but is just
taking “a shot”. These sales usually close at fair market value or higher.
3] Property Owner is interested in selling without allowing the general public to know his personal plans. He may solicit and accept an offer from someone he knows; or, he may hire a Realtor to market the property without listing it publicly in the MLS nor placing any ads. These Sold prices are usually less than what a Seller would receive if the availability of the property was known to the General Public and marketed aggressively.
Please feel free to contact me if you have questions or want details.