Some of the unintended consequences of the new rules have shown themselves already. How about the person who's been talking to a neighbor about buying their condo whenever they're ready to sell but who goes to look at a different investment property nearby. The agent who shows them the investment property has them sign a buyer broker agreement for six months and leaves the property address/description blank since they expect to be looking at various types of investment properties in the coming weeks. One day after signing the agreement the neighbor calls and says he's ready to sell the condo. There is now a contract in place that obligates the buyer to pay the agent that showed them the other property even though they aren't and won't be involved in the neighbor's sale at all.
Scenario 2: Buyer is looking to upsize from the condo they currently own. They meet with an agent and sign a BBA for one month and begin looking at units. Shortly after beginning their search, a bigger unit in their complex that is perfect for them goes under contract and they have an opportunity to exercise their first right of refusal and take over the contract for that unit. Just like the other example, these people are now obligated to pay the agent with whom they were looking at other buildings even though the agent is not and won't be involved in the first right purchase.
In both these scenarios even though the buyers are contractually obligated to pay the agent per the letter of the agreement, if I was the agent, I would not expect to be paid nor would I accept payment. Unfortunately, not all agents would feel that way. These scenarios should serve to encourage buyers to select their buyer's agent with care. Being able to trust your agent is probably going to be more important than which agent will agree to the lowest pay. If I didn't feel like I could trust an agent for whatever reason, I would not be inclined to sign an exclusivity agreement with them. The new agreements were drafted for Realtors and they are heavily slanted in the Realtors' favor. Before signing I would spend enough time talking to a prospective buyer's agent to get a feel for how fair I could expect them to be and whether I feel like I can trust them to look out for my best interest. I'm willing to pay the agent that passes that test more than the guy who can't pass the gut check of a short conversation. Be smart, y'all, and exercise caution when price shopping for a buyer's agent. They are not created equally nor will they represent you equally well. Any agent who presents a BBA asking for a percentage plus an extra dollar amount for some random "fee" has just failed the gut check.
It's been two weeks since the new rules went into effect and I'm seeing lots of listings marked as "No" seller concessions. I wonder if the listing agents are charging more for the listing side commission and advising sellers that they don't have to offer a buyer's broker anything. Agreeing to pay 4% to a listing broker and zero to buyer's broker seems like a deal compared to the pre-August 17 range of 5% to 6% split between selling and listing brokers. However, when every offer arrives with a request for a 2 to 3% concession to cover the buyer's broker's fee then the 4% turns out to be not so great a deal. One other thing I'm noticing is that these "no seller concession" listings aren't priced any lower than those who are offering concessions.
Sellers don't be deceived by larcenous listing agents trying to profit from the new rules and the public's misunderstanding of the same. Choosing to advertise that you aren't willing to offer a concession is adding unnecessary friction to the selling process. Better to leave the seller concession field in the MLS blank rather than chase away buyers who are obligated to pay their agent and who take your "No seller concession" at face value.
“Sufficiently advanced ignorance is indistinguishable from malice.” _unknown
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