Wednesday, July 28, 2010

Realtor Shenanigans???

Okay, Okay I admit I'm probably more than a little bit aggravated right now....cause...

Our bid wasn't accepted....the sellers choose a different bid....

Does this seem fishy to you?
We bid on a house that has been on the market for like uh, 3 months, the price started at $819k, went to $799k and has been at $759k for over a month...with no bids that I am aware of.

We put in our bid and all of a sudden there are 2 other bids! Bids that we are led to believe are higher than ours...

Is it out of line to ask to see the other bids? To prove that they exist and to see if we can beat them? I don't think so. If its the Realtors job to get the most money for their clients and they are presented with this option, I'm pulling my bid or you can let me look at the other bids to see if I can/want to beat it. Wouldn't they then HAVE to show me the bids? Or is this just a total B.S. tactic to try to force us to increase the amount of our bid?

I am constantly hearing from Realtors that its a breach of their fiduciary responsibility to say or do this or its a breach of their 'ethics' to say that or do this..... Who all thinks ethics and Realtors go together like oil and water?

Fiduci-what-now?
First, I want all Realtors and readers to read what the actual definition of a fiduciary is. Its absolutely anathema to the concept of fiduciary responsibility to be paid by a commission based on how high a house sells for.... Well not exactly for the sellers Realtor.....but for the buyers...holy crap what an obvious conflict of interest...

Here's what I suggest 'buyers Realtors' do.
They get paid a straight fee for their services with a bonus based on how much lower than the asking price they can get the sellers to agree too. The bonus should also be based partly on time...find a house and get into contract less than the agreed upon time and get a bonus, take longer, and get a negative bonus. Now, THAT would have 'buyers Realtors' really working for the buyers.

What is this ethics thing I'm always hearing from Realtors?
Is there some nationwide Realtor ethics code they're all sworn to uphold? If there is, I bet its written by Realtors to protect only the Realtors....same with a 'code of conduct'. Every time I get the 'ethics' excuse its because a Realtor does not want to reveal a piece of information that they think will reflect badly on the house.....

Craig's List Shenanigans
In an attempt to get the word out and jump start what I'm fearing will be a lengthy sales process I posted what basically amounts to a coming soon add for our house in the Craig's List Realty for sale section.

Some douche-bag flagged it! This wasn't like 20 people who thought my add violated the CL terms of service its one person who went out of their way to have my post taken down....

How much you wanna bet it was a Realtor whom I've written about and who posts adds to CL all the time?

Okay Rant Over, I'm going to leave the CL add up just in case the 1st place offer falls through.

12 comments:

Morrise Family said...

I'm not sure it is so suspicious to have multiple offers come in on a house at the same time. We were looking at a house, but hoping the sellers would drop the price more before we made an offer. Our realtor asked the seller's realtor to let us know if any offers came in so that we could hurry and submit our best offer. We didn't end up getting the house, but I don't think the scenario is all that uncommon--especially in this market.

Anonymous said...

I'm not sure about the laws in California since I'm in Florida - but did you actually sign an agreement with the Realtor that they were acting on your behalf as a buyer's agent? Does California recognize realtors as buyers' agents? Usually by law a realtor works for the seller (even if their only contact with the seller was presenting your bid).

I agree that the rules don't always make sense and definitely seem to be written by realtors to protect realtors!

Good luck with it all.
Cheryl
Orlando

The MadScientist said...

anon,
We had our own buyers realtor, the sellers had their own 'sellers realtor'. Only a total schmuck lets a Realtor work both ends of the deal

The MadScientist said...

Morrise Family,
Ya well, weird that they had no bids for months then as soon as we got interested there were other bids...

Anonymous said...

Its not really weird. As said above, a lot of people are interested but see no reason to make a bid while they look elsewhere, unless a bid comes and and then they feel more pressure and submit. Hence sudden multiple bids.

It's inappropriate to ask for the other bids.

The MadScientist said...

If by inappropriate you mean an awkward uncomfortable situation where the Realtor's bluff is being called?

Anonymous said...

No, I mean the decision is up to you. If you don't want to pay more, don't up your bid. What do the other bids (or lack thereof) have to do with it? It's that simple.

It's your responsibility to not get caught up in the race to beat other bids. Offer what you think it's worth, not what someone else thinks it's worth. They might be wrong.

I think the biggest problem with seeing the other bids is seeing the other buyers names, info, loan contingencies, etc. That part is definitely MYOB. Not to mention easy to fake, so if you think a realtor is that unscrupulous anyway, what makes you think they wouldn't just doctor it up? It's an easy form to fill out. Will you really know that John and Jane Doe of San Luis Obispo offered that much?

L. Opine said...

Speaking of offers, as I recall you had an interest in 1832 San Antonio. That property sold for $775,000, which seems a little high to me.

As anonymous said, the safer approach is to bid what you're comfortable playing, not $10K over what someone else is comfortable paying. And if a Realtor(tm) is shady, nothing says they're going to tell you the truth. And I don't know any agent who will show you the actual bid paperwork; I believe confidentiality rules apply.

Good luck! I think I know which house you're talking about, and I don't think it's worth the current asking price anyway. The foundation job and thin permit history scares me. But that's just me.

The MadScientist said...

L.Opine..
I didn't know that 1832 San Antonio had closed? Or do you know one of the realtors..getting some inside info?
In my review I said it was worth only ~615k... Wow the new buyers waaaaaay overpaid I think...unless that $775 includes a $100k back to the buyers to fix some things....wow that price really surprises me...

The MadScientist said...

Anon, L.Opine,
On the, just submit your best offer thing....
I think that's total and complete B.S. The only people who stand to gain from that methodology are the Realtors and the Seller.

If I want to buy a house I want to obtain it for as little money as possible...right? And my 'Buyers Realtor' should be working their pants off to that end...

If I present the selling Realtor with this option, Show me the bids (with the personal info blacked out) or I'm pulling mine wouldn't they HAVE to show me? Else they lose a legit bid. At least that's the way I see it.

The cards are stacked against the buyers in this game....

Anonymous said...

They could just let you go. They have other bids, after all.

I think you're underestimating the emotional part of selling the house. Your way of looking at it is very reductionist. Compare bids, try to get the most money. There's much more to it than that.

On an emotional level, people like to sell to those they like. The last place I sold I sold to someone who had the second highest bid for various reasons, most of which were emotional. I knew this person would take good care of the place I loved and I identified with her for various reasons, having been in her difficult position myself some years earlier.

People might sell to a family over a retired couple if they have a house in a good school district. They might sell to someone they think loves their 100-year old cherry tree and won't chop it down.

If someone asked to see the competing bids (ie "I don't trust you or your realtor") I would probably sell to the other bidder(s) unless the bid difference was fairly large. It would be a huge turn off for me.

And, there are still more business issues. A lower bid with a confirmed loan might be worth more than a higher bid with a loan contingency to the sellers. Maybe they've been burned before. Maybe a person with a lower bid can move earlier than the other bidders because he doesn't have a contingency to sell another house first, allowing the sellers to move before school starts. Maybe a lower bidder would allow the sellers to rent back for a month so they can finish their dissertation.
And so on.

Your reductionist view lacks consideration for the many facets facing a seller who is examining multiple bids. When you say, "I'm pulling my bid or you can let me look at the other bids to see if I can/want to beat it." you don't really have the whole story, just the $.

The MadScientist said...

Anon,
I think you win the prize for longest post repsonse....

I love that word 'Reductionist'...that's what I should of called my self all those years I spent as a professional saute chef... 'I am the Reductionist.'

I was thinking after the fact that we should of included a letter with our bid about how we where going to care for the house and yard...wonder if it would of made a difference...

But still, me as the buyer and my agent should be attempting to buy any house for as little as possible right? That should be our aim anyways....

I am familiar with the emotional side of selling property...we were willing to pay $100k more than the house was worth because of emotion....