Why are Arts District lofts sold so quickly? It seems like they sell before they are even listed. How are some buyers getting early access?
Today, there is not a single loft listed for sale in Downtown’s Arts District under $800,000. If a buyer wants a loft in the Arts District now, she believes that she will need to find a way to cough up around $850,000. But is she correct? Downtown Los Angeles is the new center of the universe, and the Arts District symbolizes the creative energy and renaissance in the form of genuine historic industrial live-work lofts. The good news: There IS a creative solution.
Today, Wells Fargo Securities Senior Economist Mark Vintner spoke on CNBC Squawk Box about how lenders are giving out plenty of pre-approvals, but the buyers are all bidding on the same properties. The inventory is too low in all popular neighborhoods nationwide. This is particularly true in the Arts District, where hundreds of buyers are seeking lofts. So, when a loft listing over 1,000 sq ft pops up on the MLS for less than $750,000, an instant bidding war is inevitable. Most will lose. But who will win the war? Being a cash buyer may not help.
The winner of the war will likely be the most informed buyers who nab a property before it is even listed to the public. Over the past 5 years, the winners have been the buyers who have purchased Barker Block, Beacon Lofts, Gallery Lofts, Barn Lofts, Toy Factory and Biscuit Company lofts when they were off market. Up to 45% of buyers bought pocket listings and other off-market properties. That number is expected to surpass 50%, which means that, if a buyer waits until an Arts District loft is listed publicly, that buyer will likely be too late. 95% of all prospective Arts District buyers will fail on the first attempt, and 85% of all who try to buy in the Arts District will never succeed. More and more often, the properties sell before the public ever sees the property listed on the internet. Why?
The real estate agent listing services such as The MLS, now place a 3-day delay in feeding the properties to popular real estate websites such as Trulia, Zillow and Redfin. This gives buyers who work with a real estate agent, a 3-day jump on property listings. Those working with agents can receive the new listing 3 days earlier, and buy the property before the internet-savvy crowd sees the property listed. But now, even they will be too late.
There is an even smaller group of Downtown buyers called “VIP Buyers” who can see properties before they are listed on the MLS. The VIP Buyers, who are getting privileged access to these pocket listings before agents get access to the listings on the MLS. Let me repeat that… the VIP Buyers get access BEFORE OTHER BUYERS, AGENTS AND BROKERS.
There are only a handful of Downtown Pocket Listings sources who provide the bulk of access to pocket listings, exclusive properties, private listings, unlisted properties and other off-market lofts in Downtown Los Angeles. The best part is that it costs nothing to gain this privileged access to proprietary information, and there is never any obligation to buy.
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