Pocket Listing - Rental Property Leases
A pocket listing to lease property exists when a real estate agent takes a listing without placing the listing into the Multiple Listing Service (MLS). Pocket listings are legal in California but are highly discouraged by the vast majority of real estate firms.
In order to satisfy a real estate agent's fiduciary duty, a real estate agent must do the following before taking a pocket listing:
- Disclose in writing: (1) that agents from other offices and their clients will most likely be unaware that the owner's property is available to be leased, (2) unaware that information about the owner's property will not be transferred to all of the real estate internet sites the public commonly utilizes in searching for lease listings, and (3) if the listing agent becomes a dual agent and represents both the landlord and tenant, he or she will make far more commission money than if another agent represents the tenant.
- Agents who are MLS members, must obtain written instructions from the landlord that the above disclosure has been made in writing and they still want to permit the agent to withhold the listing from the MLS.