A Strange Open House
Categories: About Realtors, Crazy Ball, Hoboken Condos
Who is Selling This Hoboken Property?
I was out with some buyers yesterday looking at condos. As usual, I searched the MLS, printed out the properties we were to see, made appointments with each agency and picked up keys at the various offices. Midway through the morning, we were on our way to a particular property on the list, when my buyer noticed this sign in front of the building (I blurred out the address):
What was so strange about it was that it looked like a “For Sale By Owner” sign. Yet I had in my hand the MLS sheet for a listing from a reputable agency in town for the very same property. The sign was clearly hand written, and lacked an agency name (as required by the real estate commission for agents). There were no identifying names, no phone number, no agency logo, none of the usual trappings. I thought perhaps the sign was for a different unit in the same building than the listing for which I had made the appointment. It wasn’t.
Upon entering, we found the unit door unlocked and 3 men inside. They welcomed us and invited us in. I immediately identified myself as a realtor with my customers. I called the agency and asked if they were holding an open house. They said no. While I was on the phone, one of the men picked up a stack of flyers from the kitchen counter, which I could see were property flyers, and shoved them in the kitchen cabinet. I asked if one of them was a realtor but they said they were the owners. Two of the three promptly left the premises.
We looked around the unit. I opened the cabinet and saw that the flyer was indeed a “fsbo” style property flyer with no identifying real estate agency info and, this was even more strange, no price!
Now, every owner is certainly entitled to try to sell his or her own property without using a realtor. My understanding, however, is that once an owner signs a listing agreement with an agency the agency typically handles the sale. The agency does the marketing, makes the appointments and hosts the open houses. The listing agreement specifies that even for a number of days after the agreement expires, the seller is obligated to pay the agency the agreed upon commission even if the seller finds his or her own buyer (unless a named party has specifically been excluded from the listing agreement when it was originally entered int0).
I wonder if the listing agent knew that these owners were holding their own open house with their own materials. Why would they have their own sign and flyers (without a price) rather than use the agency’s? What if they had found a buyer? So what exactly was going on here? Very strange indeed!
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Lopsided Hoboken Realtor Commission
Categories: About Realtors, For Sellers
Does This Set Up Really Serve the Hoboken Condo Seller?
We all know that sellers agree to pay a realtor commission when listing their condo with an agent. In Hoboken, the typical fee is 5% which is then split between the listing agency (part to the agent, part to the company) and the agency that finds a buyer (also part to the agent, part to the company). In all my years, I’ve always seen the split between the listing agency and the selling agency be 50/50.
The other day, I came across an unusual listing 5% listing. By law, the percentage commission is always negotiable between the seller and the listing agent, but what made this listing so peculiar was that the split was 60/40. I thought it might have been a typo so I called the listing agent to ask. She told me it was intentional and that her office would in fact get 3% and mine only 2% were I to sell the property. Why was that? According to her, it was to reimburse her for marketing the property.
What I wonder is how many agents working with potential buyers would find this arrangement so unusual that they might even perhaps decline to show the property? Was this unconventional practice disclosed and, more importantly, explained to the seller? Would you consider or be happy with this arrangement if you were selling? I’m very curious to know what potential sellers think.
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Double Trouble?
Categories: About Realtors, For Buyers, For Sellers, Hoboken Condos
We’ve had several posts and discussions about a listing agent selling his or her listing to his own buyer. It’s questionable if an agent can be loyal to a seller and perform his fiduciary duty to get the highest possible price for the property when working with his own buyer. Unlike other states, dual agency is perfectly legal and ethical according to the real estate rules and regs in new Jersey. But what about this situation?
Agents typically work with multiple buyers at once. A property is on the market for sale. Two or three of the agent’s buyers all wish to make an offer on the same unit at the same time. They will be bidding against each other and the agent knows all of the bids. This situation is not considered dual agency since there is no agency relationship. (This assumes the buyer did not sign any type of buyers agreement – a rare occurrence in Hoboken). According to NJ rules, the agent is merely a transaction broker whose goal is to get the deal done fairly.
The NAR Code of Ethics says: When serving a buyer, seller, landlord, tenant or other party in a non-agency capacity, REALTORS® remain obligated to treat all parties honestly.
What does that mean? Does the agent have to tell each of the buyers about the other offers? Is it up to the agent or up to the seller? What do you think?
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