A few months ago, I showed a house listed with another local real estate company. It was in surprisingly poor condition inside and I was surprised at the asking price. As is customary, I contacted the listing agent afterwards to provide feedback on my showing.
I told the agent that I thought the house was seriously over-priced by at least $30,000 and interestingly, he agreed with me. He said his clients were not co-operative about reducing the price. (I wonder why this agent would even have taken the listing). Anyway, it languished on the market for over six months but the other day, I was surprised to see a sold sign on the same property. When the sale came through our system, I was very surprised to see that it had sold fairly close to the asking price and before I even looked to see which agent made the sale, I knew the answer. Sure enough, it was the listing agent himself.
It makes me wonder, who was he representing in the negotiations? We know he personally agreed the house was over market. Did he share that opinion with the buyers? If he was representing only the sellers, I guess it’s a good bet that he did not. Were the buyers aware that it had been on the market for months for no offers? Were they given information about market conditions in the area and comparable sale values? Did they ask? Did they have a contract in place with the agent to represent their interests as a dual agent?
I feel so uncomfortable and yes, mad when I see deals like this go through. Some day down the line, they are going to want to sell and chances are they’ll have a rude awakening at that time. On the other hand, maybe they made a conscious choice to pay too much. Yeah, right.
The issue of who is representing the parties to a transaction is an important one. Buyers in particular should be sure they understand their rights and obligations surrounding this issue because NOT doing so could carry a very high price indeed.
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