When you are looking for real estate, you may see words such as "unlisted property" or "members-only property. These special-sounding words can fuel the customer's expectation that the property may be a good one that cannot be found anywhere else. However, as a professional in the real estate industry, I would like to tell you something first. Itis a fact that,in principle, there arenoproperties that are completely "undisclosed" to ordinary buyers.
Then, why is the term "undisclosed property" used? It is in the "mechanism" and "time difference" until real estate information is distributed in the market. Understanding this mechanism correctly is the surest way to avoid being misled by information and to find the best property for yourself.
In this article, we will provide you with information that will help you realize a wise search for a property by revealing the distribution mechanism of real estate information from upstream to downstream in a step-by-step manner.
Flow of real estate information to the market
There are four major steps before real estate information reaches the buyer from the seller's hand. By understanding this flow, you can grasp where information is born and how it spreads.
STEP1: Sale consultation from the seller to the real estate company (source of information)
All real estate information begins when the seller, the owner of the property, thinks "I want to sell this property. The seller first consults with a real estate company about the sale. This stage is truly the "upstream" of real estate information. At this point, information is extremely limited, known only by the seller and the real estate company which received consultation.
STEP2: Conclusion of mediation contract
When the intention of sale becomes firm, the seller concludes a "mediation contract" with a real estate company. This is a contract to formally request a sale activity, and is mainly classified into the following three kinds. It is a very important point because the range of disclosure of information afterwards changes greatly according to which contract form is chosen.
| Contract type | Contracts with multiple real estate companies | Self-discovery transaction (*1) | Obligation to register with Raines (*2) | Contract period | Duty to report business to the seller |
|---|---|---|---|---|---|
| Under-exclusive-contract exclusive duty mediation contract | Not possible (only one company) | Not possible | There is duty (within five days from a contract). | Maximum 3 months | More than once a week |
| Full-time mediation contract | Not possible (only one company) | Possible | There is an obligation (within 7 days from a contract) | Maximum 3 months | More than once in two weeks |
| General mediation contract | Possible | Possible | No obligation | No legal stipulation (usually three months) | No obligation |
1Self-discovery transaction: The seller himself/herself finds a buyer and directly signs a contract.
2 Raines: An information network system among real estate companies, as described below.
STEP3:Property information registration to Raines (REINS)
Among mediation contracts, when a "under-exclusive-contract exclusive duty mediation contract" or a "full-time mediation contract" is concluded, a real estate company is obligated to register property information in the real estate distribution standard information system called Raines (REINS: RealEstateInformationNetworkSystem). This is an information network exclusively for real estate companies, operated by the Real Estate Information Network System, which has been designated by the Minister of Land, Infrastructure, Transport and Tourism.
By being registered with Raines, the property information becomes available not only to the real estate company that signed the contract, but also to all member real estate companies nationwide. In other words, at this point, the information is widely shared within the industry, and many real estate companies are ready to introduce it to buyers. This is an important mechanism to ensure transparency and fairness in real estate transactions.
STEP4: Listing on real estate portal sites (dissemination of information)
Based on the information shared on Raines, each real estate company posts property information as advertisements on consumer-oriented real estate portal sites such as SUUMO and HOME'S. Much of the property information you usually see on the Internet is at this stage. This is the "downstream" stage of information.
The "Unpublished Property" Secret
So, what exactly is an "undisclosed property," the main topic of this article? There are three main types of "undisclosed properties.
1. Sales techniques that take advantage of the "time gap" in information
This is the most common case. It refers to information that is available for several days from the time a real estate company receives a request for sale from the seller until it is registered with Raines, or during the preparation period before it is posted on a portal site.
It is a sales strategy to seize this slight period, to produce a special feeling by introducing it to a visitor as "information which has not appeared anywhere yet," and to put together a contract by itself. In the case of a under-exclusive-contract exclusive duty mediation contract, it is obligated to register with Raines within five days, and in the case of a full-time mediation contract, within seven days, but it is a method utilizing this "time lag" of several days.
It is never illegal as a sales method, but it is necessary to understand that the word "unpublished" does not necessarily mean "excellent housing" for a buyer.
2. Restrictions on advertising activities according to the seller's wishes
Some sellers do not wish to place advertisements on portal sites, etc., for reasons such as "I want to sell without my neighbors knowing" or "I am not comfortable with my house being placed in an advertisement.
Especially in the case of wealthy people, celebrities, or sellers with sensitive situations such as divorce or inheritance, it is natural that the protection of privacy is a top priority. In such cases, even though the property is registered in Raines, it will not appear in general advertisements.
This is also sometimes called an "undisclosed property," but it can be handled by other real estate companies through Raines. In other words, it is a state of "not appearing in general advertisements, but introduction is possible through a real estate company.
3. Malicious "enclosure
This is a malicious case in which a real estate company intentionally conceals information. Aiming at "two-sided agency" that obtains a mediating fee from both the seller and the buyer, the act of not registering information in Raines or refusing a housing introduction by lying that "an application has already been made" for an inquiry from another company is called "enclosure.
Although two-sided agency itself is not illegal, the act of damaging the seller's profit for that purpose is an extremely dishonest act that may violate the Building Lots and Buildings Transaction Business Law. For the seller, it means missing the opportunity to sell at a higher price and faster, and for the buyer, it causes the disadvantage of not being able to meet the property that he or she should have met.
Five points for a smart property search
Having understood the true nature of "undisclosed properties," how should one proceed with the actual property search? Below is a summary of what we consider to be the key points for a "smart property search.
Point 1: Select a reliable real estate company.
The most important thing is to choose a real estate company that puts your interests first and deals with you in good faith. Make a comprehensive judgment based on your affinity with the person in charge, the politeness of their explanations, and the speed with which they respond to your questions.
It is important to assess the company's attitude and track record, rather than making a decision based solely on the words, "We have unlisted properties.
Point 2: Clearly state your preferences.
Rather than vague requests, it is important to organize and communicate specific conditions such as "budget," "area," "floor plan," "age of the building," and "distance from the station," so that the person in charge can make a more precise proposal.
It is also important to prioritize conditions. It is rare to find a property that meets all conditions, so it is important to clarify "non-negotiable conditions" and "conditions that can be compromised.
Point 3: Communicate regularly.
Don't stop once you have consulted with your account manager. Build a relationship with your account manager by keeping in touch with him or her regularly so that you can get new information quickly.
Your contact person will be more inclined to give priority to customers who are eager to find the information they are looking for. Building a good relationship will result in good property encounters.
Point 4: Use multiple sources of information.
It is effective to check not only one real estate agency, but also your own portal sites and actually walk around the area you are interested in.
By broadening the range of information you gather, you will acquire a sense of the market and develop the ability to judge whether or not the proposed property is really appropriate.
Point 5: Make decisions calmly and without haste.
It is important not to be misled by sales talk that encourages impatience, such as "If you don't decide now, someone else will take it.
Real estate is one of the biggest purchases in your life. Do not be afraid to consider it until you are satisfied and have time to make a calm decision. If the property is really good, it is well worth taking a little time to consider.
In summary: The real value is not in the "information" but in the "trusted partner.
As we have explained, there is practically no such thing as a completely closed "undisclosed property" for the average buyer. The term "undisclosed" is only created by the "time difference" and "difference in the scope of disclosure" in the information distribution process.
The most important thing when searching for a property is to correctly understand the structure of real estate information without being misled by the term "undisclosed. What is even more important is to choose a reliable real estate company as your partner that puts your interests first and acts with integrity.
A good real estate company does not merely have a lot of property information. They deeply understand each customer's needs, propose the most suitable properties from among the vast amount of information circulating in the market with their professional knowledge, and ensure the safety of transactions until the very end. We believe that "quality" is the true value.
We at INA & Associates, Inc. promise to be your best partner. Please feel free to contact us with any questions you may have regarding real estate.
Frequently Asked Questions (Q&A)
Q1. Do really good properties sell before they appear on the Internet?
A1. This is not necessarily true. Certainly, a buyer may be found for a property with good conditions after it is registered with Raines and before it appears on a portal site. However, that is the result of consulting with a reliable real estate company and the buyer accurately communicating his or her desired conditions being introduced at the appropriate time. What is more important than the speed of information disclosure is building a relationship with a reliable person in charge.
Q2. Is it possible to meet good information if I visit several real estate companies?
A2. It is possible to obtain information on properties under a "general mediation contract" quickly, but it is not necessarily efficient. Under the Raines system, if it is a "full-time mediation contract" or "under-exclusive-contract exclusive duty mediation contract" property, the information is shared by any real estate company. Rather, if you narrow it down to one reliable partner and communicate closely, the person in charge will work more earnestly to search for a housing, and as a result, the possibility of meeting a good housing will increase.
Q3. Is there any way to recognize a real estate company that is "enclosing" properties?
A3. It is difficult for a buyer to identify them directly. However, if, for example, they unnaturally emphasize that "this housing can only be handled by our company" or rush you into a contract without letting you compare it with other properties, you may need to be careful. If you have even the slightest doubt, one way is to inquire about the same property with another real estate company. An honest company will never engage in such behavior.
