Buyer Representation
The Enron debacle and Martha Stewart's confrontation with the SEC typify the ethics crisis in business today.
Here at Real Estate Works, we diligently strive to avoid activities that could give rise to any questions of conflict of interest.
An agent executing a listing agreement with a homeowner creates a fiduciary responsibility to represent the owner's best interest in selling the property.
The agent's brokerage firm, and perhaps the agent, will make more money if "In House" listings are sold in house, and custom and advertising frequently bring "the buyers" to the listing brokerage.
Consider this hypothetical, though common situation. The agent, through homework and market savvy presents the homeowner with an estimate of what the market will pay for the property. The owner, then lists the property with the agent and then instructs the agent to sell at, lets say, $250,000.
This price is within the comfort range of some potential buyers, and after several meetings with the agent and property showings, the buyers now have some rapport with the agent, whom they feel is "their" agent, and they ask to have an offer written.
The buyers have been squired through the whole process by the agent and feel they are well represented, even though they now are advised that the agent really represents the seller.
The most familiar situation that describes the buyer's actual position is that they are "customers", dealing with a friendly commissioned salesperson.
Back to writing the offer, the buyers may ask "their" agent what price the owner might be expected to accept.
They are asking the wrong person! The owner may have revealed to the agent that $235,000 was the lowest acceptable price, and the agent will certainly discourage the buyers from offering a lower price, even though unforeseen circumstances might dictate that the property eventually sells for $225,000.
The buyers are being led, rather than being represented.
Nevada Revised Statutes have established some guidelines for "Dual Agency" "Assigned Agency" and "Single Agency" Representation, but Real Estate Works will not participate in challengeable transactions.
My Best Personal Regards,
Carolyn Reeve
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