2013 Apr 22nd

The Latest Way for Agents to Beat the System in Hoboken Real Estate Sales

One would think that the number of days a property has been on the market is an important thing for a buyer to know.  Even in a hot market.

One would also think that whether a property for sale has had a price reduction might also be a relevant fact.  I certainly think so.

Our MLS system allows agents to make a price change.  If a price change is entered into the MLS, you can see that the price was changed and you can look at the history to see what the old price was before the change.  You can also see how many days something has been listed by looking at the “DOM” or ‘days on market’.  The clock starts ticking when the property is listed initially and keeps going through however many price changes it takes to get it sold.

A condo that’s had 3 price reductions and has been on the market for 107 days does not seem as enticing as a new listing with no price reductions that’s only been on the market a day, right?  Seems like important stuff to know when your shopping for a condo in Hoboken.  I would ask my agent those questions if I were a buyer.

Yet there is a new game in town.  The game is played by the same few agents every time they want to do a “price change”.  But these agents don’t enter a price change.  They’ve figured out how to game the system and say ‘the seller wanted me to do it that way’.

Rather than reduce the price, the agent has the seller sign a withdrawal form so the listing comes off the MLS.  The agent then immediately re-lists the property at a new, lower price.  This way you, the buyer, (and maybe other agents) are hopefully fooled into thinking that:

1.)  It is a brand new listing and shows up as such in the daily “hot sheet” of new listings and at the top of internet sites that list by newness;

2.)  It hasn’t been sitting on the market unsold for any period of time at a higher price; and

3.)  There have been no price reductions.

When I asked the powers-that-be at the Hudson MLS about this I was told “it does not violate any rules”.   It may not violate any rules but don’t you think it hurts you – the consumer – when information about a market as vital to the economy as the local real estate market is distorted?  Or maybe all agents will start to play this new game and the “price change” will become a thing of the past while “DOM” becomes meaningless.

Caveat Emptor lives on.

 

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  1. Chili Agee

    I’m sure that must mess up your weekly, monthly and quarterly statistics when you publish the average DOM for all units.

    Thanks for doing that, by the way. Your Weekly Wednesday Wrap-Up and Quarterly statistical analyses are outstanding. Not like the boiler-plate crap other agents post on their blogs. Your commentary shows real insight. Keep up the good work.

  2. Zach Turner

    In this “hot” market, a buyer may jump on a “new” listing in a way that they would not if they knew the property had recently spent a month or more on the market at a marginally higher price. That kind of information would also, inevitably, affect a buyer’s negotiating stance with a seller.

    All the more reason to engage a savvy and knowledgeable Realtor to act as a buyer’s agent when you enter the market. All those folks who think they can rely on Zillow.com and other sites–which just re-package MLS info into a more user-friendly format–are sitting ducks for the kind of manipulation you describe.

  3. Gilby

    I concur – this sight is an excellent resource and brings a lot of much needed clarity and honesty into the real estate sphere. As for Zillow – actually, the listings there seem to stay up forever, it might show that a new listing, might not be so “new.”

  4. Andy

    Thanks for airing this Lori. I would argue that there may be several more abuses of RE agents in Hoboken that go unrecorded or are not policed because they do not violate a set of rules. I’m always wary of any realtor in Hudson county for this exact reason both as a buyer and a seller.

    Your site over the past few years has restored my faith that the good ones are attempting to fight the good fight and when i’m ready to sell you are the first person i’m calling.

  5. Lori Turoff

    Thanks guys. You have no idea how many enemies I have made because I refuse to play along with the games. I’m going to write a book when I retire. I appreciate your support.

  6. Craig

    Lori, it doesn’t matter how many enemies you make in your profession by fighting the good fight and insisting on doing things the right way. Because you’ve made a lot of friends and potential clients amongst us consumers. I too am not selling or buying anytime soon. But when I am ready to sell my condo and buy a new one (if i stay in Hoboken), like Andy said, you’re one of the first people I’m calling. You’re one of just three agents I trust in this town.

  7. Robert

    Agreed with the comments above. Wednesday is my favorite day of the week.

  8. Dustin

    As a new agent in Hoboken, I’ve appreciated your posts and knowledge. I do have one question, if an agent practices this unethical behavior and petty act, does it show up on the MLS? Can we as agents, look at the MLS and see prior price listings? That way, when we represent a buyer, we can confront the listing agent who performed this? Thanks!

  9. Karina

    Great point Lori

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