Another reason for the industry to commit to full transparency and the auction method of selling homes – our Code of Ethics doesn’t help much:
Q: I submitted an offer for a buyer client that was near the full listing price and asked the listing broker if any other offers existed. The listing broker said no. The next day the broker called me and told me the property sold to a different buyer. Shouldn’t the broker have told us that there were multiple offers when the other offer came in and given my client the opportunity to modify the offer?
A: This is one of many misconceptions about handling multiple offers. The primary provision in the Code of Ethics related to multiple offers is Standard of Practice 1-15, which says “REALTORS®, in response to inquiries from buyers or cooperating brokers, shall, with the sellers’ approval, disclose the existence of offers on the property.” You asked if there were any existing offers at the time you submitted and the answer was, apparently, no. Nothing in Standard of Practice 1-15 or any other part of the Code requires the listing broker to go back to any or all other buyers who made an offer should one or more additional offers come in after your offer was submitted.
While it might seem that listing brokers should be required to go back to all those other buyers if other offers come in, a seller may choose not to take that action and may choose another direction to negotiate a sale. It may also seem that going back to previous offers would always be in the best interest of a seller. But, from the seller’s perspective, there might be both price and non-price terms of the other offers that are more attractive. The seller might not want to risk that the later, better offer may be withdrawn in the time it could take to reinform the other buyers and allow them to change their offers.
One tip for cooperating brokers in multiple-offer situations is to ask the listing broker about other offers on more than one occasion during the negotiations. It’s no guarantee that you will hit the right time, but it might give you more information for your buyer client in the negotiation on high-demand properties.
Link to Article
The author is the past chair of the NAR Professional Standards Committee, so this is the best we got.
I hate how he and most realtors hide behind the seller making the decisions.
In almost every case, the listing agent presents a plan, and the seller says, ‘OK, that sounds good’. The agents are the experts, and should give strong, powerful advice on how to handle multiple offers.
But they tend to be lazy or unethical, and discourage or eliminate other buyers from contending – to the detriment of their seller.
https://www.nar.realtor/code-of-ethics-and-arbitration-manual/part-4-appendix-ix-presenting-and-negotiating-multiple-offers
This is one of many misconceptions about handling multiple offers.
Here you have a guy in a position of authority who can set the record straight on how the Code of Ethics falls short, and besides, there is no enforcement anyway. He could have taken the high road and explained how the agent probably got screwed in this case, and strive for better outcomes.
Instead, he blames the agent for not bugging the listing agent enough, and shrugs it off. And it gets printed in a national publication for all other realtors to see.
Buyers and sellers – these shenanigans happen every day, and your chances of getting screwed by an agent are real, unfortunately. Get Good Help!
As a recent buyer (thankfully just found a home) in Carmel Valley, I’ve been blown away by how unprofessional agents are in these multiple offer situations.
2 times recently I was contacted by an agent who declined my all cash offer. One was the seller decided they wanted to only sell to a neighbor. Guess what? Those deals fell apart…and once you’ve wasted people’s time they are not so eager to do you a favor for misadvising your client.
I would welcome the auction format myself.
I can’t imagine conducting my business in the manner these agents do. Wish all of them were Jim.
(Some of it is the sellers to blame. At least the CV ones seem to be focused on sucking every single damn cent out of the home, forgetting that they’ve had massive appreciation, are selling TRACT homes!, and a bird in hand is worth something.)
Forgot to mention these offers were a fair bit over list!
The hotter the market, the more fraud and deceit.
So the listing went from no offers one day to sold the next day. Not even to pending 1st. Was it put on the MLS to make it look good ? Where’d the buyer come from over night ? Maybe an “in house buyer” was all lined up. Very typical
these days. To few listing to give sales away. Who’s interests were best served,
seller, buyer or the listing agent ? Guess.
The rules seem to be made to keep the agents barely in compliance, while giving them the wiggle room they need to maximize there commissions. Thats why all the big firms have a bank of lawyers on staff.
This is one story of many.The norm, not the exception. Most are worse. The 1st
rule in RE – there are no rules.
After 35 years in the industry (never an agent) think its fair to say, 90% of agents,like any occupation are useless at best.There major function and the thing they do the best is sitting at the closing for there check.We all enjoy writing that one.
90% of buyers and sellers are getting poor to bad help. they don’t know what good help looks like. Its a 2 maybe 3X event in a life time.Most just want it over.
I never recommended a RE agent. Worked with over 100. Jim’s the one exception. Not for all the reasons stated in the reviews to the right. He’s honest, smart, hard working etc… but because he knows how bad the industry has become and knows had to function in it with standards higher then I’ve ever seen.Protecting his clients interests and getting them to the finish line.A true professional. Thats what puts him in the top 1% in my book. I know, he helped me.
Like me, he hates seeing people getting screwed. This is his trade and he does it very well.
Thank you C. Kid!
really got screwed over by a realtor and their sellers. got screwed over by the inspection where upon the house was damaged upon receipt plus it was a high fire area risk not disclosed to us. be careful if you pay all cash and don’t run a mortgage because you can fall thru the loopholes. horrible experience and it’ll be yours word against theirs. couldn’t officially move into the house because it was toxic and unlivable. make sure you get all information and aren’t left hanging not knowing what to do. they would not make it right and lie to me. these things happen people. home buying is not easy and I regret it. found them on zillow. but maybe that’s the safest place to look when buying a home. make sure to contact the inspector after the fact and tie up any loose ends. really bad experience and reviews can only tell you so much about the realtor.