You missed who is ultimately responsible for your predicament. The fault is with your agent for not telling you it was not an agreement until it was signed in writing. The lessor's agent acted badly, against your interest, by lying or deceiving you, but he was not doing anything against the law by doing so. Your agent dropped the ball by not telling you immediately after their agent told you not to worry, that you should not count your chickens before the the contract/lease is signed. So sue your agent, not the lessor's agent. And find a better agent next time.
1
I bought my first home in 1980. The agent was wonderful, she really looked out for us, we had no idea what to do. We sold in 1988. 1st we tried FSBO, we got tired of people with crazy schemes asking us to go in as partners w/them on our house, or just who couldn't buy. We ended up listing with our former Realtor who to this day I thank God for sending her to us. We had gone into contract with a FSBO. It was instrumental in my becoming a Realtor. I could relate horror stories all day, but suffice to say with no one to guide us and help us, the owner left wires dangling from the ceilings with no fixtures after he'd removed them. We paid him a per diem because it took us longer to find a buyer than we thought and we needed an extension on our contract. He lied and said his house was ready, it wasn't. We each stayed in our homes 5 days for some ridiculous reason I do not remember, and when we arrived at our new home he had taken all the wall to wall carpeting (which we agreed to) exposing plywood beneath. I had asked what was under the carpet, his reply was "wood".
NONE of this would have happened if I'd had a Realtor like myself representing me.
My friends and neighbors have tried to sell FSBO and most have been jerked around by buyers who were not ready, willing, and able to buy, losing them time and money.
It's sad to see all the trolls out on this thread bashing my profession. If you think it's so easy and pay so much get yourself a license and try it yourself.
NONE of this would have happened if I'd had a Realtor like myself representing me.
My friends and neighbors have tried to sell FSBO and most have been jerked around by buyers who were not ready, willing, and able to buy, losing them time and money.
It's sad to see all the trolls out on this thread bashing my profession. If you think it's so easy and pay so much get yourself a license and try it yourself.
1
The title "Realtors and Ethics" seems an oxymoron, or at least an incongruity. Rarely, if ever, the twain shall meet...
3
This story is as old as the hills. It has been true for centuries that in real estate it's what is in writing that counts. If you believe a real estate agent that says otherwise you might as well believe a divorce lawyer that says this is the best deal you can get. On the latter subject I recall an old Woody Allen joke that went his divorce lawyer was so bad that the final provisions of the decree stipulated that if he remarried and had children his divorced wife got them.
The code of ethics is online at http://www.realtor.org/sites/default/files/policies/2016/2016-NAR-Code-o...
Having said that, the brokers are under contract to the sellers, and their commission comes from the sellers. The sellers have the resource: the site and the house on it.
And the buyers have the funds.
Everything depends whether it is a buyers' market or a sellers' market.
Having said that, the brokers are under contract to the sellers, and their commission comes from the sellers. The sellers have the resource: the site and the house on it.
And the buyers have the funds.
Everything depends whether it is a buyers' market or a sellers' market.
2
So why did the writer decide to end his lease early - just because it was beneficial to the landlord ? Was it really a two year lease? Some leases are one year then convert to month to month. Was the landlord a friend or relative? Something not adding up in that part of the story.
3
The realtor for the house I purchased purposefully inflated the price of the house. Then, she reviewed the list of visitors and called back only the people who didn't have a buyer broker. In this way, she insured that the seller would not get the best price, but rather that she got the whole commission vs sharing it.
1
I am buying a house this fall and truly dread dealing with Realtors. There is no fiduciary or value added service they provide. The National Association of Realtors (NAR) was one of the biggest factors in the housing crisis by providing false economic analysis (in September 2007 Martin Yun, their chief economist, said that it was the perfect time to sell a home) to not censuring real estate agents for misrepresenting homes, and using arbitration as a means of covering up agents breaches and shielding liability for agents and real estate companies. Here, in Washington DC, that have been complicit with the "investors" (AKA flippers) which has decimated the affordable housing stock in the city.
I have yet to meet a real estate agent in a "hot" (I hate that word) market that didn't offer useless advise or falsely represent their actions in negotiations.
I have yet to meet a real estate agent in a "hot" (I hate that word) market that didn't offer useless advise or falsely represent their actions in negotiations.
6
Value adds: knowledge of neighborhood, market dynamic for your market, knowledge of contract, resources for service providers of all types, resources for more information on a myriad of issues including local zoning, taxation, schools, planned development, etc.
A fiduciary duty DOES exist with an agency (client to broker) relationship.
The fact that you haven't seemed to meet an honest agent doesn't mean they don't exist.
A fiduciary duty DOES exist with an agency (client to broker) relationship.
The fact that you haven't seemed to meet an honest agent doesn't mean they don't exist.
2
I'm sorry you had such a bad experience that you would paint an entire profession with such a broad brush. As a Realtor I also would like the NAR to do some educating, rather than parrotting "now is a great time to buy!" in every market. However I do not think you have made a case for the NAR being "one of the biggest factors in the housing crisis". The biggest factors in the housing crisis were the banks. They pushed people into mortgages they could not carry, they did not due income checks. I myself was hounded to take out home equity loans every time I went into the bank. When I did have the need to borrow, I was pushed to borrow more and more on my HELOC every time. Along with the banks and their appraisers, who overvalued properties, I blame the homeowners themselves. I cannot tell you how many homeowners I met with who had paid 250,000 for a house in 2002 and owed over 500,000 in 2007. They were falling behind in their payments but had new cars, new furniture, new pool, new RV, etc etc etc. Once again, I'm sorry you find no value in the help of someone who has negotiated thru the sales of hundreds of homes and been faced with many hurdles along the way (I still come across situations I have never been faced with before but can consult with many associates who have), but there is no law you have to use a Realtor. Good luck.
Stories like the author's are too common, but they will be mere historical oddities in a couple of decades. The real estate brokerage business -- like the insurance brokerage business - is unlikely to survive another 20 years of internet progress. There is just not 6% of value flowing to the seller, and that added to the stories of fraud and self-interest, will eventually write an end to the industry.
Mamas don't let your kids grow up to be realtors.
Mamas don't let your kids grow up to be realtors.
8
What do you see the industry looking like? Online bidding and automated contracts? Do you think buyer and seller will happily help each other along through the negotiation, inspection, and escrow process?
1
Real estate agents work for themselves. Nothing wrong with that, just don't ask me to believe you are working for me when you are actually working for you.
As an aside, years ago during a corporate move my husband and I got into the realtor's car and cracked up laughing. It reeked of pot. After being shown homes all over suburbia we ended up buying a home in town that was a for sale by owner and did not use a realtor at all.
As an aside, years ago during a corporate move my husband and I got into the realtor's car and cracked up laughing. It reeked of pot. After being shown homes all over suburbia we ended up buying a home in town that was a for sale by owner and did not use a realtor at all.
5
Anyone who pays $4,000 for a two bedroom rental is part of the problem.
1
That is just ignorant.
1
"Over the next few weeks, I sought out nearly 20 agents and other real estate professionals for their opinions. Virtually all acknowledged that I had been treated unethically, if not contemptibly."
You wasted your precious time contacting 20 other agents for their... 'opinions' on what transpired? For what?...to confirm what you already knew to be true? And did you really expect these other agents (who clearly viewed you as a potentially new client for each of them) to respond any other way? Of course they are going to commiserate with you.
Anyway, it seems really pointless to ask NYers what their 'experiences' have been like with local realtors. NYC realtors have the reputation they do, for a very good reason. Nuff said. If you have oodles of money for a penthouse apartment overlooking the Park, you'll get the cream of crop of NYC realtors working with you. Otherwise, your chances of finding a broker in NYC with any modicum of ethics, professionalism and honesty are slim to none. Anyone looking for an apt in NYC must question everything, and be on the constant lookout for scams.
You wasted your precious time contacting 20 other agents for their... 'opinions' on what transpired? For what?...to confirm what you already knew to be true? And did you really expect these other agents (who clearly viewed you as a potentially new client for each of them) to respond any other way? Of course they are going to commiserate with you.
Anyway, it seems really pointless to ask NYers what their 'experiences' have been like with local realtors. NYC realtors have the reputation they do, for a very good reason. Nuff said. If you have oodles of money for a penthouse apartment overlooking the Park, you'll get the cream of crop of NYC realtors working with you. Otherwise, your chances of finding a broker in NYC with any modicum of ethics, professionalism and honesty are slim to none. Anyone looking for an apt in NYC must question everything, and be on the constant lookout for scams.
6
When we bought our first house decades ago, we signed an agreement of sale with the owners, and THEN the realtor made changes to the agreement to our detriment. Fortunately, we had a wonderful attorney who threatened the realtor with the loss of his license so the agreement was changed back to the original one that we signed. Lesson learned - always have an attorney to take you through these ordeals - you cannot trust realtors to work in your best interest.
3
We put a bid in on a house and got an inspector who found real problems, including a sinking foundation - he absolutely did his job and I was grateful. We pulled out of that sale, but stayed with the realtor. Put an offer in on the next house and asked for the same inspector. When I showed up to meet the inspector at the house, some other inspector was there and the realtor told me that the prior guy was sick and she had to find someone else. I discretely called the inspector's office and - he was at work and would not say why it was that he was not doing the inspection.
Big surprise, the second inspector did a terrible job as it turns out - just as one example we learned later that the floor joists in the bathroom were rotted due to a drain leak. That was readily detectable. The inspector went on and on about trivial stuff that no one would care about.
I see no other conclusion other than that the realtor connived to bring in a favorable inspector and made sure that sale was completed - no matter how bad the house was.
Don't trust anything they do or say.
Big surprise, the second inspector did a terrible job as it turns out - just as one example we learned later that the floor joists in the bathroom were rotted due to a drain leak. That was readily detectable. The inspector went on and on about trivial stuff that no one would care about.
I see no other conclusion other than that the realtor connived to bring in a favorable inspector and made sure that sale was completed - no matter how bad the house was.
Don't trust anything they do or say.
4
I do hope you wrote reviews of this individual on Zillow, Facebook and Google?
3
The Manhattan version of this story would make this one laughable, especially for those renting in this price range, which sounds high but in Manhattan is about starting range for a decent building a notch above a rickety staircased, roach infested, walk up.
To pursue such a jewel would almost surely require an agent, and at the very bottom of the ladder of real estate salespeople in New York are low end rental agents. Usually young, inexperienced (in life, much less real estate), broke and desperate, and churned in and out of the industry like actors at a Broadway audition. These naïve, white collar cogs are often just as taken advantage of as their clients by the unscrupulous broker offices that sponsor them and abusive landlords or managements offices, all of whom treat them as unpaid (because they are) servants.
And who suffers in the end? The public. These “agents” are supposed to be licensed by the state and they are – but that license isn’t worth the paper it’s printed on when there is zero enforcement. And worse, these lesser priced apartments are also frequently shown and marketed by whatever unlicensed drudge the landlord scrapes up. This is illegal for many reasons, but it’s all part of the mess that is New York real estate. As the insanity that began in the 1980’s continues to rise, the unscrupulousness (is that a word?) grows. It’s very sad.
To pursue such a jewel would almost surely require an agent, and at the very bottom of the ladder of real estate salespeople in New York are low end rental agents. Usually young, inexperienced (in life, much less real estate), broke and desperate, and churned in and out of the industry like actors at a Broadway audition. These naïve, white collar cogs are often just as taken advantage of as their clients by the unscrupulous broker offices that sponsor them and abusive landlords or managements offices, all of whom treat them as unpaid (because they are) servants.
And who suffers in the end? The public. These “agents” are supposed to be licensed by the state and they are – but that license isn’t worth the paper it’s printed on when there is zero enforcement. And worse, these lesser priced apartments are also frequently shown and marketed by whatever unlicensed drudge the landlord scrapes up. This is illegal for many reasons, but it’s all part of the mess that is New York real estate. As the insanity that began in the 1980’s continues to rise, the unscrupulousness (is that a word?) grows. It’s very sad.
3
I agree on all your insights save for the $4000 price range being 'starting range' for a decent apartment in Manhattan. People seem to forget there are many neighborhood in Manhattan, and within these are sub-neighborhoods, individual blocks that vary greatly, and then even buildings side-by-side, that can vary greatly from one another. 2BRs can certainly be had along the far side (1st Ave, York) of the UES, in Inwood, in Wash Hts, in the outer reaches of the LES, etc, for less than $3000, and which are not 'roach-infested'. Sure they may not have a doorman or a 'fitness center', but then many people can live just fine without those things.
I find that whatever one thinks to be the 'going rate' for an apt. in NYC, that that is exactly what one will find, as once a broker understands what a renter 'expects' to pay, that broker will not show the individual anything that may in fact exist at a lower price, for to do so would mean less commission for the broker.
I find that whatever one thinks to be the 'going rate' for an apt. in NYC, that that is exactly what one will find, as once a broker understands what a renter 'expects' to pay, that broker will not show the individual anything that may in fact exist at a lower price, for to do so would mean less commission for the broker.
1
There's always Yelp. You might not resolve your situation, but at least you can let others know that the realtor and his agency are not to be trusted.
2
Mr Millar - you do a disservice to your readers and honest realtors by not naming names.
3
Are you a sleazebag that has no marketable skills? Become a real estate broker!
2
A number of years ago I came to realize that realtors do not seem to understand their ethical obligations. Agency law (not just in real estate, but in general) requires YOUR agent to represent YOU - agents owe clients loyalty, putting the client's best interests above other people's interests. If there is a conflict of interest, the agent must disclose it, but disclosure does not eliminate the obligation of loyalty.
Case in point. We were interested in making an offer on a house and we told our agent. She seemed uneasy and she said "I need to tell you I happen to know that another offer is going to be made on this house today." We said, "oh, ok."
Pregnant pause, whereupon agent says "and actually I am putting in the other offer." And that was all she felt it was necessary to say - was to tell us that she had 2 clients whose interests were in direct conflict. We told her we no longer needed her services as an agent. We complained to her broker who defended her: "We disclosed - that's all we needed to do." Er, I don't think so. I haven't fully trusted a real estate agent since.
Case in point. We were interested in making an offer on a house and we told our agent. She seemed uneasy and she said "I need to tell you I happen to know that another offer is going to be made on this house today." We said, "oh, ok."
Pregnant pause, whereupon agent says "and actually I am putting in the other offer." And that was all she felt it was necessary to say - was to tell us that she had 2 clients whose interests were in direct conflict. We told her we no longer needed her services as an agent. We complained to her broker who defended her: "We disclosed - that's all we needed to do." Er, I don't think so. I haven't fully trusted a real estate agent since.
11
What else did you expect she say? Part of an agents duties are loyalty AND confidentiality, were you expecting to hear the terms of the other offer?
1
Having lived in NYC since the late 90's, I have seen my share of shady brokers. So many, in fact, that I've completely divorced myself from the industry. For the last 15 years, I only rented apartments directly from management agencies or through personal contacts. A few years ago when I bought my house, a brownstone in Hamilton heights, my husband and I did so without brokers. And now that we have rental units, we find and screen tenants ourselves. It's actually not that hard to live and function in NY without ever needing a broker. The hassle and frustration saved is worth much more than the small, incremental efforts it takes to do so. I hate to disparage a whole industry due to the bad behavior of a few bad apples but my experiences haven't been good. My advice to all brokers is to help yourselves by helping to ferret out those bad actors before people come to the realization that I came to: brokers aren't all that necessary after all.
10
There is no honor among "Realtors©". They feel a need to capitalize their jobs (cannot call what they do a profession) while teachers, clergymen, judges, etc. do not.
They used to hold their MLS information tight, and refused to negotiate their commissions. The entire scam is falling apart now with abundant online information available.
Real estate transactions can be honorable, efficient, and affordable. I once sold a house, in a hot seller's market, for a $300 flat fee using an innovative and imaginative broker who saw the opportunities that his greedy compatriots did not.
If you are a buyer, always remember that, even though you may engage a "buyer's broker," that person is working for the seller because s/he splits the commission with the seller's broker. You need a real estate attorney who you pay (modestly) for expert guidance and who serves as your fiduciary.
They used to hold their MLS information tight, and refused to negotiate their commissions. The entire scam is falling apart now with abundant online information available.
Real estate transactions can be honorable, efficient, and affordable. I once sold a house, in a hot seller's market, for a $300 flat fee using an innovative and imaginative broker who saw the opportunities that his greedy compatriots did not.
If you are a buyer, always remember that, even though you may engage a "buyer's broker," that person is working for the seller because s/he splits the commission with the seller's broker. You need a real estate attorney who you pay (modestly) for expert guidance and who serves as your fiduciary.
4
The commission for the buyers broker does typically come from the commission charged to the seller from the listing broker. But the buyers broker is NOT working for the seller. His/her fiduciary duty is to the buyer.
1
Thirty years ago we worked with a real estate agent, looking for our first home. She constantly showed us houses priced well above what we planned to spend but that wasn't the deal breaker by any means. At the outset, we told her no houses on dirt roads. I grew up on one and knew I didn't want to live on one. After wasting more than a few weekends looking at houses on dirt roads she assured us the county was planning to pave, I stayed in the car at the last house, refusing to get out. We told her on the ride home that we were done with her services. The house we have lived in all these years is the one we were renting while we searched. The owner carried the contract and happily, no real estate agents were involved. If we could only be sure it will be sold that way too, we'd be happy. We certainly plan to try. Real estate agents, in our opinion, serve no useful purpose.
4
Right another pet peeve of mine- agents who pay absolutely no attention to what you clearly tell them. "We will not consider a house with a pool," for example - and the agent continues to show pool homes. Or "we need at least one bedroom and a full bathroom on the ground floor" which gets ignored. Or "no cul-de-sac homes, they are too isolated and depressing..." well you get the drift.
2
This is silly.
When someone offers a house for sale or for rent, in writing, and a buyer / renter comes along and accepts the offer, in writing, accompanied by the required $$, the deal is done. Simple as that. If the buyer throws in stuff like financing or other contingencies, it is not an acceptance.
But a simple "I want x rent for my place, one year lease, and a renter who says OK and at the same time signs the deal and hands over the $$...deal done.
When someone offers a house for sale or for rent, in writing, and a buyer / renter comes along and accepts the offer, in writing, accompanied by the required $$, the deal is done. Simple as that. If the buyer throws in stuff like financing or other contingencies, it is not an acceptance.
But a simple "I want x rent for my place, one year lease, and a renter who says OK and at the same time signs the deal and hands over the $$...deal done.
2
Why did you agree to move? The home could have been sold with your lease intact; it might make the home less palatable to potential buyers but that is the seller's problem, not yours. Since you agreed to move, you should have asked the landlord to pay your moving costs and the difference between your new rent and your old rent for the remainder of the existing lease so you were not suffering the brunt of someone else's decision.
18
This was my question, too. Or, actually: why did the landlords ask him to move? Based on what we're told, there was no need; people put homes with tenants on the market all the time.
3
Whenever someone tells me "don't worry," that's when I worry.
13
I am at a loss to understand why the author gave his cottage landlord the extremely generous gift of vacating a property he had a lease to for another year. The lease would remain in force even if the property were sold.
By renting another house at a dramatically higher price, the author spent about $16,800 of his own money to do his landlord a favor. Why? Are they a family friend? Is $16,800 just not a lot of money to him? I don't get it. That amount of money would pay my mortgage for 20 months.
By renting another house at a dramatically higher price, the author spent about $16,800 of his own money to do his landlord a favor. Why? Are they a family friend? Is $16,800 just not a lot of money to him? I don't get it. That amount of money would pay my mortgage for 20 months.
34
Nobody, but NOBODY, gives up a sweet deal on a rental property in the metro NYC area, just to do their landlord a favor. (Or, insert any other hot R.E. market; Boston, San. Fran., etc. etc.). Just to rent something else at a vastly higher price! Oh, & just "trust" what the R.E. agent says, w.o. having a signed lease?
And this guy writes for the R.E. section of the NYT........hhmmm. Also, I wonder what happened with his former landlords. What are the odds they asked him to move out b/c they realized they could get $1000 more a month?
And this guy writes for the R.E. section of the NYT........hhmmm. Also, I wonder what happened with his former landlords. What are the odds they asked him to move out b/c they realized they could get $1000 more a month?
1
"innocents like me"....and you have moved 28 times? I guess that for you the learning curve (at least in real estate) must slope quite steeply.
19
The weird part is that someone can make 6% for driving you around in an SUV. Takes no training or skill other than a slightly slimy cunning.
19
It's not for the driving -- for what it is worth, I have rarely been driven by a realtor but usually meet them at houses.
You pay -- even in this age of the internet, but VERY much so in yesteryears -- for their ACCESS. They have the MLS, they have the MLS descriptions and room sizes and taxes -- they have the keys or codes to the lockboxes -- they can legally get you inside properties to see them.
Good luck doing that on your own.
You pay -- even in this age of the internet, but VERY much so in yesteryears -- for their ACCESS. They have the MLS, they have the MLS descriptions and room sizes and taxes -- they have the keys or codes to the lockboxes -- they can legally get you inside properties to see them.
Good luck doing that on your own.
4
The only time in my rather long-so-far life that I have been in a car that literally ran out of gas and stopped was when I was being driven around by a realtor, with my young child in the car. We sat on someone's lawn while waiting for the guy to figure it out. This was 45 years ago and I'll never forget it.
3
It's a racket
6
Mr. Miller,
Do you have a friend or family member who is a lawyer? If so, he or she might welcome the challenge of seeking to redress the wrong that you suffered. I believe that a reasonably good case can be made that, while a contract to lease real estate for more than a year generally must be in writing to be enforceable, there are exceptions. One is based on the concept of promisory estoppel. In your case, you took action to your detriment (giving your landlord notice that you would vacate) in reliance on the promise that the property was yours). Your damages are not speculative--you leased the same property for $10.000 more. I think you need a friend or relative because the suit makes no economic sense if you have to pay a stranger a normal fee. There is a relevant law review article at 44 Fordham L. Rev.114 (1975). Good Luck.
Pat Fox
Do you have a friend or family member who is a lawyer? If so, he or she might welcome the challenge of seeking to redress the wrong that you suffered. I believe that a reasonably good case can be made that, while a contract to lease real estate for more than a year generally must be in writing to be enforceable, there are exceptions. One is based on the concept of promisory estoppel. In your case, you took action to your detriment (giving your landlord notice that you would vacate) in reliance on the promise that the property was yours). Your damages are not speculative--you leased the same property for $10.000 more. I think you need a friend or relative because the suit makes no economic sense if you have to pay a stranger a normal fee. There is a relevant law review article at 44 Fordham L. Rev.114 (1975). Good Luck.
Pat Fox
4
"Promises" by a tenant's agent cannot bind an owner.
5
The Author is misguided in laying blame on the landlords agent. That agent has a fiduciary obligation to obtain the best deal for his client and to act on his clients instructions. The landlord may well have been content with his offer that evening and received a better offer in the morning before committing to sign a contract with the author. It would have been in the landlords best interest to accept the higher offer (questioning his ethics of verbally committing) yet he still did offer the Author the opportunity to beat the subsequent offer, so even the landlord did not act unethically. If the shoe were on the other foot how would the author feel about being accused of unethical behavior for acting in his own best interest and allowing all interested parties an equal opportunity to bid on his property? The Author rightly points out that Realtors routinely get a bad rap - and he just demonstrated unjustly so.
9
No, the author is entirely justified. The author communicated to his agent that he was concerned about not getting a contract signed. The landlord's agent's response was: "Don't worry the house is yours" That was dishonest communication. There are several honest answers would have been more appropriate.
* We will do the paper work next week (Giving a reason is not a requirement).
* Silence - (not a good option)
* We are waiting a week to see if a better offer comes in (honest and transparent. Transparency it not an ethical requirement - honesty is).
The agent was dishonest in his communication for which there is no excuse.
* We will do the paper work next week (Giving a reason is not a requirement).
* Silence - (not a good option)
* We are waiting a week to see if a better offer comes in (honest and transparent. Transparency it not an ethical requirement - honesty is).
The agent was dishonest in his communication for which there is no excuse.
16
The housing gamesmanship of the mid 2000's is all you need to know about the ethics of the realtor profession. I'm not absolving the other players on the Street but realtors were just as culpable.
10
Thank you for pointing this out. I have never understood why this hasn't been acknowledged more in the discussions and publications of the 2008 financial crisis.
2
Dear Bryan
I have been a licensed real estate broker for 25 years and have seen my share of good, bad and seriously ugly events by all parties involved in a sale or rental transaction. There are many factors at play in a sale or rental. You have to remember that it's not only the real estate agents who controls the flow of information in a transaction, but the owners of the property can have a serious impact on the end result. Sellers or landlords can act in a way that cause the agent to be left in a compromising situations. Many owners don't have any experience in the process and can act in such a way to cause the agent to look bad. And it's my experience that the agents are alway getting the blame. I'm certainly not implying that many agents can be less than professional or even duplicitous. But having worked with the best agents in the city, and the worst, it's my experience that over all most of them are fair and honest. One big problem is the threshold of entry to get a real estate license is extremely simple. Therefore many people enter the field with no professional experience. They have no understanding in how to deal with all the moving parts of a transaction. This leaves many people extremely vulnerable.
I alway work very closely with new agents to insure they are working in the best interests of all parties.
However at the end of the day, it's not always the agent that can cause the problem. Alway ask for a manager if things start to unravel.
I have been a licensed real estate broker for 25 years and have seen my share of good, bad and seriously ugly events by all parties involved in a sale or rental transaction. There are many factors at play in a sale or rental. You have to remember that it's not only the real estate agents who controls the flow of information in a transaction, but the owners of the property can have a serious impact on the end result. Sellers or landlords can act in a way that cause the agent to be left in a compromising situations. Many owners don't have any experience in the process and can act in such a way to cause the agent to look bad. And it's my experience that the agents are alway getting the blame. I'm certainly not implying that many agents can be less than professional or even duplicitous. But having worked with the best agents in the city, and the worst, it's my experience that over all most of them are fair and honest. One big problem is the threshold of entry to get a real estate license is extremely simple. Therefore many people enter the field with no professional experience. They have no understanding in how to deal with all the moving parts of a transaction. This leaves many people extremely vulnerable.
I alway work very closely with new agents to insure they are working in the best interests of all parties.
However at the end of the day, it's not always the agent that can cause the problem. Alway ask for a manager if things start to unravel.
10
Great article but a bit misleading to the public outside of New York or perhaps the tri state area. In most of the country a Realtor or agent writes contracts which become binding upon signature of both parties. Same for leases. All of the forms are state sanctioned and brokers fill out the forms as part of the transaction. So a home or rental in this case is legally off market as soon as th buyer and seller sign. In NY brokers do not complete any paperwork other than agency disclosures, the attorneys prepare the contracts. I can't speak for outside of Manhattan but I;m pretty sure the entire state functions as such. So it's very common to verbally accept an offer but then take another while waiting for contracts or in case of this a lease. This is a function of how the state works and not a bad broker. As a broker they have to present all offers until a deal is signed. It's possible they were shopping this lease but it's also possible this was a function of how things work in the state and this is not how it works in most states. I'm a broker and no defender of Realtors, But in NY there are weeks that go by with no deposit and no contracts so of course this happens. The author did not sign a lease the day it was agreed upon but I have a feeling the author did no put any money down as a deposit either so they could have just as easily walked away. The article is not really true to form.
6
Yes, it is crazy here in NYS, the lack of simple up front contracts and the fact that there is no requirement to disclose conditions (just pay $500 in lieu). Seems to me like this is yet another 'full lawyer employment' hook up - just like if one divorces or dies here in this state. Needlessly expensive and absolutely NOT protective of the average person. Though I have heard that the lawyers let the sales contract forms go through in Western New York state -- guess lawyers don't think that there is enough money there to shake down.
The problem with real estate is that the agent's and owner's commission is much too important for many people. They have no ethics in business or personally. People should insist upon immediate acceptance (written communication) so the offer is accepted or seek an attorney. It's your money until you give it away. Be proactive and protect yourself.
3
Why not name the realtor or, at least the firm. That will make the story more credible and alert us to the unethical real brokers that we shouldn't use.
13
Brian Miller, for years you reviewed restaurants for the Times, and I'll never forget the meal I had at that superb place you recommended in the hills of Tuscany. After all this time, how could you be so naive?
The Haggler column names names - why not tell us who this swindler is?
The Haggler column names names - why not tell us who this swindler is?
18
Realtors behave just like any other commission based employee working with other peoples money. Ie, on average worse than professions without that toxic combination.
1
Was selling a remote Alaskan cabin. Agent brought us an offer, but said the purchasers had visited the cabin and seen undisclosed damage. Would we drop the price? Hired someone in town to do an inspection. No such damage. Another concern raised about undisclosed problems, again with a low-ball offer. Again we paid someone to check and found no issues. Eventually it became clear the purchasers were not intending to pay the original agreed-upon price. Oh, well, I figured, there was the escrow money. Guess what? The purchasers' agent never got an escrow check, so neither did we. We did, however, work with our agent to report her to the state real estate board. Licensing and oversight is supposed to help avoid these problems.
7
Due Diligence.
Who doesn't know that unless it's in writing, it's not binding? I wouldn't malign all realtors--i've never heard of them having a bad rep as a whole. I was shocked at the rug being pulled out from under him halfway through the lease by his current landlord. People forget that since rentals are super scarce, what leverage does a renter have? He says he's not going to have to move again? He has a really short memory.
2
From my experience real estate agent and ethics dont belong in the same sentence, especially when i hear the term "buyers agent" who in effect has a fiduciary responsibility to the seller. My last experience involved a property that had no action in 7 months. I made my offer and was told 2 more offers came in the same day. Thanks, but no thanks.
5
In New York, real estate agents must have clients sign a disclosure form that explains the difference between a seller’s agent, who provides undivided loyalty to the seller, and a buyer’s agent, who represents the buyer’s interests. A dual agent can represent the buyer and the seller, but both parties must consent to the arrangement and acknowledge that they are giving up the benefits of exclusive representation.
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2
(continued) In Florida, real estate agents are presumed to be "transaction brokers" unless otherwise disclosed to the customer. As a transaction broker, your real estate agent provides to you a limited form of representation that includes the following duties:
1. Dealing honestly and fairly;
2. Accounting for all funds;
3. Using skill, care, and diligence in the transaction;
4. Disclosing all known facts that materially affect the value of residential real property and are not readily observable to the buyer;
5. Presenting all offers and counteroffers in a timely manner, unless a party has previously directed the licensee otherwise in writing;
6. Limited confidentiality, unless waived in writing by a party. This limited confidentiality will prevent disclosure that the seller will accept a price less than the asking or listed price, that the buyer will pay a price greater than the price submitted in a written offer, of the motivation of any party for selling or buying property, that a seller or buyer will agree to financing terms other than those offered, or of any other information requested by a party to remain confidential; and
7. Any additional duties that are entered into by this or by separate written agreement.
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1. Dealing honestly and fairly;
2. Accounting for all funds;
3. Using skill, care, and diligence in the transaction;
4. Disclosing all known facts that materially affect the value of residential real property and are not readily observable to the buyer;
5. Presenting all offers and counteroffers in a timely manner, unless a party has previously directed the licensee otherwise in writing;
6. Limited confidentiality, unless waived in writing by a party. This limited confidentiality will prevent disclosure that the seller will accept a price less than the asking or listed price, that the buyer will pay a price greater than the price submitted in a written offer, of the motivation of any party for selling or buying property, that a seller or buyer will agree to financing terms other than those offered, or of any other information requested by a party to remain confidential; and
7. Any additional duties that are entered into by this or by separate written agreement.
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2
I’ve always had good experiences with real estate brokers-- as a renter, buyer and seller. As with any business transaction (not just real estate), it’s your responsibility to build your team of advisors/agents. Some are better. Some are worse. But those that are extremely unethical should be able to be spotted pretty quickly- they talk the talk and walk the walk. If you go with any of those, look in the mirror as you’re probably the one to blame for being foolish enough to hire them to be on your team in the first place. As for the author of the article… (1) You had rights to your original unit as a renter—your landlord had no legal right to ask you to move. You could have remained in your tenancy after your landlord sold the place and (2) shame on you for thinking you had a right to the new unit without having yet had it in writing. In real estate, it must be in writing and signed by all parties. Until then, if a better offer comes along, for either of you, either of you can back out. Stop playing the “victim” card. You were not “wronged.” Time for you to grow up.
9
The ultimate contract is between the landlord and the tenant, which, for real estate, must be in writing and signed by both parties. Use of words like “it has been accepted” or “it’s yours” or similar wording is a poor use of words by any of the parties- landlord, broker, applicant tenant. It might not have been intentional deception. But the word choice was poor. The better wording would have been something like, “Right now, it looks very favorable for you but the property owner wants to wait a few days to see if someone else comes in higher. If not, he/she will very likely present you with a lease to review/discuss and possibly modify accordingly if you have changes to propose which they agree to, etc.” Meanwhile, you can continue looking for other rentals just in case. In real estate, it’s not official until it’s in writing and signed by both parties. Intentional deception here? I’m not sure. Poor word choice and reliance by applicant tenant on that poor wording? Yes, absolutely.
3
Professionals know how to use words correctly. If you believe real estate agents are professionals - they should learn to use words correctly for example - Don't say its yours until a contract is signed.
7
A realtor in our lake community listed a waterfront home of a widow at a reasonable price of $435,000. A month into the listing, the price was lowered by $5,000. Fifteen days later the home was sold to the listing agent for $320,000. I have been in the home and it was well maintained and showed well. The widow was not short of money. This doesn't pass the smell test because it sold far under market value in an area where properties are selling. This particular agent has most of the listings in the lake community and controls who sees the properties. One wonders if perhaps she had her eye on this property and steered other agents and buyers away. A realtor friend of mine says there are no rules preventing what appears to be a huge conflict of interest. I suspect she also got all the furniture at this ridiculous bargain basement price. She is an evangelical. Clearly she missed the lesson of being a moral person.
22
Hmmm, as a licensed Realtor for 33 years I can tell you that your Realtor friend is very wrong. Number one rule of Real Estate is that the agent had a fiduciary obligation to the client which was clearly violated. That includes getting highest and best price and disclosing to all parties if the buyer ir seller is also the agent. In this case, the agent can be sued and likely win, but the seller and/or their family have to initiate this.
4
Not that there is a valid excuse for deception and unethical practices perhaps if one were to consider that real estate agents more often get cheated and lied to than articles like this suggest. Since real estate agents have such a bad reputation people feel quite justified to treat them all like criminals who deserve any scams the vengeful public can dream up.
Very few home buyers are paid by commission. They get a regular paycheck just for showing up. The National Association of Realtors continually does research and a few years ago reported that nationally the average Realtor ends up working for less than minimum wage. Federal tax codes mandate that 90% of a real estate agent's income must be from commissions. With those commissions the agent must pay all of their living expenses, including health insurance. They don't have employer subsidized plans either.
They also have to share significant percentages of those commissions with their sponsoring broker and other agents party to a sale. Lease commissions generally pay very little, maybe $100, not a percentage of the sale.
Very few home buyers are paid by commission. They get a regular paycheck just for showing up. The National Association of Realtors continually does research and a few years ago reported that nationally the average Realtor ends up working for less than minimum wage. Federal tax codes mandate that 90% of a real estate agent's income must be from commissions. With those commissions the agent must pay all of their living expenses, including health insurance. They don't have employer subsidized plans either.
They also have to share significant percentages of those commissions with their sponsoring broker and other agents party to a sale. Lease commissions generally pay very little, maybe $100, not a percentage of the sale.
1
Is that an excuse for a lack of ethics?
2
It's human behavior. What about lack of ethics on the part of consumers who approach Realtors and then turn around to cheat and abuse them. No one writes articles in major newspapers about that. It's always cautionary articles like this that warn the innocent public about the evil, manipulative, cheating real estate agents.
Articles like this one are a dime a dozen.
Articles like this one are a dime a dozen.
2
Several years ago, I bid on a house here in Connecticut. I really wanted the house so I went above the asking price, knowing that there was another interested party. And, I removed the contingency for a mortgage since I was able to. The house was not in contract with the other party. And yet, the selling broker wouldn't take my broker's phone call for 2 days. Finally, the bid was acknowledged by the selling broker who said the "parties would be going to contract in a few days." In other words, she had a deal and didn't want to lose it. Plus, the other buyers were the son and daughter-in-law of yet another real estate agent. My bid was never presented to the homeowner, which is illegal in CT. The seller lost an additional $20k and the closing took nearly 3 months because the buyer couldn't secure a mortgage. I could have closed in less than 45 days. My broker just said "it's too bad that it happened this way." If I ever buy another house, I will contact the owners directly via phone or letter to let them know my offer, even if it has been "presented" to them. Too much squirrely stuff goes on in Fairfield County real estate. And, if I sell my house, I will make sure that I have in the contract with any selling agent that I am allowed to accept bids from buyers directly, especially those who contacted me before I signed any agreement with a selling broker. It's both seller and buyer beware in this part of the state.
16
I am absolutely SHOCKED that the NY Times ran this on the front page of the Real Estate section. The vast majority of realtors are hard working, honest people (I am not a realtor). I have bought and sold homes several times. These are always challenging experiences - but nothing to question an industry over. There is nothing in this story that suggests anything other than a real estate agent doing his job - representing the best interests of his client, the landlord. By printing this story, the NY Times is giving voice to someone who wants a story to be there - and there is no story.
5
The many comments agreeing with the author beg to differ!
8
I am shocked there haven't been more stories like this printed. I have been in similar situations as both a buyer and a seller. Multiple times.
5
I'm glad this article was posted to give information. We've run into great Realtors, but our last one was deliberately lied to us about the NYC rental he owned and was going to rent to us (claiming he wasn't owner). Long story short, I wish we ran into a more honest Realtor like you, rather than what we got swindled out of.
What about the tenant who changes his or her mind or decides they want to pay lessIs that ok? Until you have a signed lease both parties are entitled to change their mind. Grow up!
15
I'm sorry but I don't think you have a claim against the owner's agent. Deals fall apart all the time because someone comes along and offers more.
The culprit in this story is your agent. She is your supposed expert advisor and it's her responsibility to walk you through the process. She should have warned you that nothing is final until it's signed. If she had, you would have known not to promise your landlord you were moving and you would have been in a much better negotiating position for the new house.
The culprit in this story is your agent. She is your supposed expert advisor and it's her responsibility to walk you through the process. She should have warned you that nothing is final until it's signed. If she had, you would have known not to promise your landlord you were moving and you would have been in a much better negotiating position for the new house.
41
I would disagree. While the author may not have an actionable legal claim against the owner's agent, he most certainly has an ethics one. I would suggest you go back and re-read how this transpired:
"My agent forwarded my offer to the owner’s agent, who responded within hours that it had been accepted.
When I expressed concern about the delay in signing the lease, the owner’s agent — whom I never met nor spoke with — informed my agent that there was nothing to worry about; the house was mine."
The offer was verbally accepted by the owner's agent with no provisos or conditions. And when the tenant questioned the delay he was again reassured "the house is yours". The agent did not say, "unless a higher offer comes in in the next x days", or, "the owner has instructed me to leave it on the market for x days and if no higher offer is made, then and only then is the house yours." Whether that was the initial intention or whether the agent or owner changed their minds after the author's offer was verbally -- and emphatically -- accepted, they acted in bad faith.
"My agent forwarded my offer to the owner’s agent, who responded within hours that it had been accepted.
When I expressed concern about the delay in signing the lease, the owner’s agent — whom I never met nor spoke with — informed my agent that there was nothing to worry about; the house was mine."
The offer was verbally accepted by the owner's agent with no provisos or conditions. And when the tenant questioned the delay he was again reassured "the house is yours". The agent did not say, "unless a higher offer comes in in the next x days", or, "the owner has instructed me to leave it on the market for x days and if no higher offer is made, then and only then is the house yours." Whether that was the initial intention or whether the agent or owner changed their minds after the author's offer was verbally -- and emphatically -- accepted, they acted in bad faith.
3
I respectfully disagree; both agents failed to act in good faith even if nothing they did was illegal. While the statement that deals fall apart if someone comes along and offers more is true, that doesnt make it right. The Leasers agent stated the house was his, but didnt give any reason (let alone a good one) for not allowing him to sign a lease right away. His agent should have warned him that this could be a ploy and should have insisted on signing the document ASAP.
Not all agents behave poorly; but too many seem to be lazy and dont do the work they should be doing on their clients behalf.
Not all agents behave poorly; but too many seem to be lazy and dont do the work they should be doing on their clients behalf.
I wish the author had named the real estate agent. And while he might have been naive about not having it in writing, he was honorable to a fault...kind of appalling how many of the commenters blame the victim here.
15
There is a saying, "how do you know a lawyer is lying? Their lips are moving." To that, I would like to add a corollary: "how do you know a realtor is lying? They're breathing."
9
What a pleasant way to view things...you will reap what you sow.
1
It is/was the tenant's Realtor's obligation to inform the prospective tenant that there was the possibility he could lose the house to a higher bidder if the lease wasn't fully executed (that is to say, signed by BOTH parties). As far as the comments on the ethics of Realtors or real estate agents/brokers are concerned, I recommend ANYONE looking for a Realtor should seek out either a referral from a trusted friend or family member &/or check out the professional's reviews on Zillow, where I can proudly say I have 133 five star reviews. Those are THE BEST ways to fine/hire a real estate professional
5
In some other counries, I am thinking of Scotland, "prices" on homes are generally assumed to be a starting point for bids, so they are really saying "offers in excess of " whatever. In the case of Bryan Miller's cottage, it should have been listed not at $3,600 but at "offers in excess of $3,600," and then nobody could be told they "got it" until they were at told they had the winning high bid.
1
I've purchased 3 homes in my lifetime. I purchased the first one from the owner and on a scale of -5 to +5 I'd give it a +5. I purchased the second one from the builder and on the same scale I'd give it a +3. I used a real estate broker as a buyer's agent for the third one and on the same scale I'd give it a -5.
5
I actually had a harder time with my mortgage broker than with my realtor. The mortgage broker kept dithering on a formal pre-approval letter; we just kept getting "We'll get it to you". Then she went radio silent for twelve hours the day we needed to make a formal offer. I had to call a different mortgage broker, do a very quick application over the phone (fortunately I had all the information handy) and get *that* pre-approval letter so we could make the formal offer and get what turned out to be our dream house.
Our realtor saved the sale; without her we wouldn't have been able to make the offer, and we absolutely love our house. We ended up recommending her to a friend of ours who bought a house through her and she sent us a gift card to Lowe's.
They're not all evil.
Our realtor saved the sale; without her we wouldn't have been able to make the offer, and we absolutely love our house. We ended up recommending her to a friend of ours who bought a house through her and she sent us a gift card to Lowe's.
They're not all evil.
5
Nevermind the agent, I would not want to rent from such a greedy, unscrupulous landlord.
3
You know nothing about this property owner except what you infer from this one-sided account. Please, credible evidence and all relevant facts prior to opining--in this article and others.
3
Does anyone here believe that Bryan Miller's broker actually had another potential renter?
Real estate brokers in general--the lowest of the low.
Real estate brokers in general--the lowest of the low.
5
I sincerely hope you sent a copy of this to the realtors involved, including their home offices.
3
Real estate agent and ethics are an oxymoron
6
Real Estate is the ultimate "Buyer Beware." In NY nobody really represents the buyer.
But there really is a lot of independent data out there to help people now, at least on the buying and selling side. Listings are public on many sites, and sales are public information too. You can go look at what the realtor has chosen as a comp. You can create your own comp, and see how the realtor stacks up, and how the realtor explains his or her estimate. And no one should ever buy without an inspection they trust.
Renting is harder, because comp data is harder, and rentals can be scarce, leaving the leverage in the hands of the landlord.
Mostly though, the biggest leverage you have is to be willing to walk away. When someone gives you a take it or leave it ultimatum, leave it is a good strategy.
But there really is a lot of independent data out there to help people now, at least on the buying and selling side. Listings are public on many sites, and sales are public information too. You can go look at what the realtor has chosen as a comp. You can create your own comp, and see how the realtor stacks up, and how the realtor explains his or her estimate. And no one should ever buy without an inspection they trust.
Renting is harder, because comp data is harder, and rentals can be scarce, leaving the leverage in the hands of the landlord.
Mostly though, the biggest leverage you have is to be willing to walk away. When someone gives you a take it or leave it ultimatum, leave it is a good strategy.
9
I totally agree on being willing to walk away. Too many potential renters and buyers let themselves be jerked around.
4
I bought a co-op about two years ago. At the end of the closing both the buyer and seller attorneys, the mgmt company representative and the co-op lawyer exclaimed this was one of the fastest and least problematic closings they've seen in a long time. When all we did was sit there for about an hour and sign the papers. Very amenable and straightforward. Gives you an idea about the state of NYC real estate transactions.
BTW - I never use a broker or pay a broker's fee, I do the legwork myself. I save on commissions and can get a sense of the other party, and they of me, when I show the place. I place a very detailed listing online so that only truly interested buyers will contact me, and I put "no brokers" in big letters in the ad. That way you know what is really going on, who is coming to your place, and there are no (or at least fewer) ugly surprises.
BTW - I never use a broker or pay a broker's fee, I do the legwork myself. I save on commissions and can get a sense of the other party, and they of me, when I show the place. I place a very detailed listing online so that only truly interested buyers will contact me, and I put "no brokers" in big letters in the ad. That way you know what is really going on, who is coming to your place, and there are no (or at least fewer) ugly surprises.
3
As a homeowner selling your own house you can also discriminate in who you sell your house to. A licensed real estate agent cannot.
As for knowing who is coming to view your house a Realtor can screen any visitors before they visit by making sure they have the necessary financing and can even do a perfunctory criminal background check.
As for knowing who is coming to view your house a Realtor can screen any visitors before they visit by making sure they have the necessary financing and can even do a perfunctory criminal background check.
2
As a Realtor for 17 years, I've found every interaction is different, most fair and some not so fair. Sort of like Forest Gump's box of chocolate.
4
Therein lies part of the problem. No rules, no regs, no guidance, especially for the newcomer. I hate everything about real estate, almost as much as buying a car.
2
There are plenty of rules and regulations that real estate agents have to follow, but every state is different so you have to learn your state's real estate laws and regulations. There is plenty of guidance. Just look for it.
2
Also, perhaps someone who saw the place before you decided to make a higher offer- (after your offer was verbally accepted)? The realtor's job is to present ALL offers. The realtor did his job. The landlord decides not the realtor.
You also were given the opportunity to raise your offer, and you decided not to.
I guess the author doesn't like the free market or perhaps likes it only when things go their way.
I bet the landlord was happy for the extra $300.
You also were given the opportunity to raise your offer, and you decided not to.
I guess the author doesn't like the free market or perhaps likes it only when things go their way.
I bet the landlord was happy for the extra $300.
5
Don't be so naive. Not all buyer's offers are formally presented if the selling broker doesn't want those numbers.
1
As a residential Realtor, I feel compelled to address the lynch mob forming in this Comments section. Buying, selling, or renting one's home is stressful in the best of circumstances. In the midst of a real estate transaction, people's lives are in tumult, they're preparing to turn a major page in their life story, the future is unknown, the financial commitments are daunting, and so are the risks -- it's not for the faint of heart. It also requires clear thinking. My advice is to find a Realtor you trust and communicate with him or her openly. Put everything in writing, hire your own "experts" for opinions, and if a problem arises during the transaction, iron it out or walk away. If a problem arises after the transaction, don't blame the person who worked to help you get where you wanted to go. Blame the process or advice you didn't follow. Ever hear a person say they sold their house for way too much? Or bought their house for way too little? Me neither.
9
I am shocked 67% said they would definitely recommend their broker. I would think the number is much lower.
I do sympathize with the author. This story shows why many people choose to avoid working with brokers when possible.
I am a little irritated at the defense of the broker's unethical conduct in the comments, and the "blame the victim" attitude. You are basically saying that brokers serve no purpose other than to enrich themselves. If that is true, why should anyone ever use a broker for a property transaction, especially as a buyer?
I do sympathize with the author. This story shows why many people choose to avoid working with brokers when possible.
I am a little irritated at the defense of the broker's unethical conduct in the comments, and the "blame the victim" attitude. You are basically saying that brokers serve no purpose other than to enrich themselves. If that is true, why should anyone ever use a broker for a property transaction, especially as a buyer?
2
Why isn't anyone talking about the ethics of the new landlord in this case? The landlord agreed to a monthly rental price, and then reneged on the deal when a better offer came along. Personally, I wouldn't want to enrich such an unprincipled individual under any circumstances. The author's willingness to play the game only encourages this unethical behavior.
2
You do not know what the property owner did or did not say or do.
1
Unfortunately realtors are like car salesman. Very shady. Both are dependent on sales commission so they are most interested in selling at the highest possible price as that is how they make their living. Everyone, I'm sure, has a story of how they were duped by a realtor and a car salesman.
10
Do you believe that real estate agents can earn a living without referrals?
2
It's the renters agents job to manage their expectations and tell them not to give notice to the landlord until they have a fully executed lease. Since even a preliminary written agreement outside of the lease is not really enforceable in court. The lease is the contract.
2
I don't know about anywhere else, but the situation in Florida is exceedling strange. In law school, I "learned" that the relationship between principal and agent was fiduciary, with the agent was to act in the principal's best interest, and not her own.
But Florida statutes permit "joint" representation, where the agent is permitted to act for both the buyer and the seller. So where does the fiduciary relationship exist? Who knows? I certainly don't know.
A lot of the problem can be solved by hiring a lawyer, but not all of it. All there is is a real mess. By statute.
But Florida statutes permit "joint" representation, where the agent is permitted to act for both the buyer and the seller. So where does the fiduciary relationship exist? Who knows? I certainly don't know.
A lot of the problem can be solved by hiring a lawyer, but not all of it. All there is is a real mess. By statute.
1
In Connecticut, as a buyer, you sign a buyer's agreement. As a seller, you sign a seller's agreement. Your agent then is supposed to represent you from the perspective you've signed. However, this gets really dicey when the agent is representing the seller yet is also your agent. I don't know how they can separate the two parties' interests. Also, if both selling and buying agents are in the same realty house, that can be dicey but as a seller, you can ask for a reduction in the commission to close the sale.
That's called 'dual agency' and is very tricky for a real estate agent. It's fraught with many legal liabilities and hazards. Some states prohibit it and others strictly regulate dual agency with specific laws. It's depends on the state.
2
Too bad that as a lawyer you fail to understand the law of joint representation. The duties are spelled out by the statute and they differ from a normal principal-agent relationship.
Moreover, my experience with real estate agents trumps (no pun intended) the experience that I have suffered in dealing with lawyers. With lawyers, both ignorance, dishonesty, and arrogance dominate.
Moreover, my experience with real estate agents trumps (no pun intended) the experience that I have suffered in dealing with lawyers. With lawyers, both ignorance, dishonesty, and arrogance dominate.
2
I was the victim of Fran De Toro of H.Pearce Realty in New Haven. Unethical and unprofessional is the least of it. I tried without success at the time to complain to the "managing broker" but to no avail. The damage was done and now, 10 years later, I am still suffering from this person's inexperience and ineptitude. Buyer beware for sure.
4
I'm always curious as to whether a realtor's absence of ethics in the marketplace is reflected elsewhere in their life, with their friends and relations? Is it something under their volition that can be turned on or off, or a good, solid, irredeemable pathology? With just personal experience to guide me, I can only assume the latter.
5
Not quite the same but similar. This was for a two week rental in Charlestown Mass. Contract accepted. Money paid through credit card included owner's insurance and cleaning fee. Nonrefundable airline reservations made. Several weeks later I saw that money had been refunded to my credit card. Huh??? It seems the owner got a better offer. VRBO not only would not address this issue but refused to allow me to leave feedback alerting others, because through no fault of my own, I hadn't actually stayed there. I too had to scramble to find other accommodations and paid a third more for half the space. I had a written contract. For all practical purposes, it was useless. Since it is usually impractical to take someone to court, your options are limited.
10
In my view, this is one of the principal problems with renting through outfits like VRBO and AIRBnB -- owners are always changing their minds. If I were renting such a place,I would have added a clause to the contract specifying the damages to be paid if the owner backs out. There are provisions for renters backing out, so why not for owners?
8
I had this happen just last summer -- again, it was a vacation rental for a week in Florida. Also from VRBO.com.
I booked early to ensure we had a place and a good deal. I paid IN FULL the entire rental cost up front, and considered it a "done deal".
Six months later (!!!), the owner emailed me and said "sorry, my husband is sick, so we must back out". Now -- it wasn't their own home. They lived in another state. They had a service who cleaned and handled any problems. Why would the husband's health be ANY FACTOR AT ALL? They lived 500 miles away! they were not going to come by to check on us!
From talking with her, I had the feeling she had a better offer. I had booked a week at mid-month. I feel certain the owner had an offer for a whole MONTH, and my week was preventing her from getting this superior arrangement and more money. So she just made up a total LIE.
Since rentals in this area are snapped up early....this meant our vacation plans were RUINED. We found some place -- in a less desirable area, far from the attractions we wanted to be near -- far from family -- and it cost 50% more for a much less nice rental.
VRBO.com did nothing, and refused to take any action. Yes, we had a signed contract! and payment via a credit card. Did not matter! The owner claimed, "I could back out any time I wanted if it was due to bad health" -- even though the CONTRACT said no such thing.
I booked early to ensure we had a place and a good deal. I paid IN FULL the entire rental cost up front, and considered it a "done deal".
Six months later (!!!), the owner emailed me and said "sorry, my husband is sick, so we must back out". Now -- it wasn't their own home. They lived in another state. They had a service who cleaned and handled any problems. Why would the husband's health be ANY FACTOR AT ALL? They lived 500 miles away! they were not going to come by to check on us!
From talking with her, I had the feeling she had a better offer. I had booked a week at mid-month. I feel certain the owner had an offer for a whole MONTH, and my week was preventing her from getting this superior arrangement and more money. So she just made up a total LIE.
Since rentals in this area are snapped up early....this meant our vacation plans were RUINED. We found some place -- in a less desirable area, far from the attractions we wanted to be near -- far from family -- and it cost 50% more for a much less nice rental.
VRBO.com did nothing, and refused to take any action. Yes, we had a signed contract! and payment via a credit card. Did not matter! The owner claimed, "I could back out any time I wanted if it was due to bad health" -- even though the CONTRACT said no such thing.
1
We had a real estate agent who was supposed to be working for us, but was unhappy that we did not immediately accept a lowball offer from the buyer she had brought to us so she could earn a quick commission. So she threatened to show them other homes and, indeed, enticed them to buy something else. I told her bosses that we would work overtime to get her real estate license pulled and seek all other possible remedies. After negotiations involving our attorney, the agency agreed to assign another, more experienced realtor to our case and substantially reduce the commission. Not long after, our house was sold at the price we wanted.
All you can do in these cases is to watch your agent like a hawk. Also be aware that you might even have to change attorneys in midstream, as we did when we started to see that our lawyer was not working in our best interests, but was colluding with the unethical agent. She likely had offered him other business to try and sway things in her direction.
It was a mess, but when the dust settled, we got our price and and paid much less to the agency.
All you can do in these cases is to watch your agent like a hawk. Also be aware that you might even have to change attorneys in midstream, as we did when we started to see that our lawyer was not working in our best interests, but was colluding with the unethical agent. She likely had offered him other business to try and sway things in her direction.
It was a mess, but when the dust settled, we got our price and and paid much less to the agency.
8
You would think that a veteran of 24 moves might be a little less naive when it comes to the ways of real estate negotiations. The only thing anyone here is guilty of in this situation is the tenant's agent neglecting to inform the tenant the possibility of this scenario in the first place. i don't think it's right to assume that the delay in signing the lease was a ploy to secure a higher price from someone else. Maybe it was, maybe it wasn't. Besides, since the other offer came in the day after the first, the outcome would likely have been the same. There was nothing unethical done here. Incompetence on the part of the tenant's agent, perhaps. But not unethical.
4
"At the moment, I’m thinking that the best option may be never to move again."
And stay as a tenant of the landlord that suckered you into a higher rent? I bet there never was another tenant interested in the house. I would have definitely walked and found another place.
Once something similar happened to me. A friend and I were negotiating to lease a restaurant. We negotiated all terms over a weekend. On Monday the owner changed the terms and wanted more. On principal I walked. My friend went ahead with the deal on his own. I don't think he ever made much. I passed the place recently. The people after my friend are still there after 35 years.
And stay as a tenant of the landlord that suckered you into a higher rent? I bet there never was another tenant interested in the house. I would have definitely walked and found another place.
Once something similar happened to me. A friend and I were negotiating to lease a restaurant. We negotiated all terms over a weekend. On Monday the owner changed the terms and wanted more. On principal I walked. My friend went ahead with the deal on his own. I don't think he ever made much. I passed the place recently. The people after my friend are still there after 35 years.
5
As an agent: I have been in similar situations, but with sales not leases. Oftentimes, when I am the listing agent, I say the offer is accepted (and it is) but then the other side takes two days to sign and send checks over and---in a competitive market--well that's a long time. Other, higher offers come in and--sorry--not sorry that you missed your chance because of your agent's procrastination in getting things done. I feel bad--but my fiduciary duties are to MY client and, until it's signed, it's not a deal (and buyers back out of verbal deals ALL the time, oftentimes without even letting the selling agent know). For every listing I do, I get at least two agents who tell me "an offer is coming in" only to never send in that offer and never tell me otherwise (good agents know to keep the other side apprised of changes).
This particular case sounds shady to me because a) it was a rental and it seems unethical to make someone wait a week to tie up the deal but then b) what agent would allow their desperate tenants-to-be wait a week to put a contract together? c) what kind of idiot agent representing the tenants would not advise their clients as to the tenuous position the clients were in until things were signed?
My view: the listing agent was not treating all parties fairly and that is an ethics violation. However, the tenants' agent on this one was a hot mess. And, I feel, is ultimately responsible.
This particular case sounds shady to me because a) it was a rental and it seems unethical to make someone wait a week to tie up the deal but then b) what agent would allow their desperate tenants-to-be wait a week to put a contract together? c) what kind of idiot agent representing the tenants would not advise their clients as to the tenuous position the clients were in until things were signed?
My view: the listing agent was not treating all parties fairly and that is an ethics violation. However, the tenants' agent on this one was a hot mess. And, I feel, is ultimately responsible.
4
I am surprised that the author, a longtime reporter for a leading national newspaper who has moved dozens of times, was so trusting. The healthy skepticism he would apply to statements by politicians would have served him well here.
I am also surprised that the author would pay $4k a month for a rental cottage, working in a precarious industry like journalism. It makes me feel better about my $2800 mortgage payment for a small Long Island house.
The author was misled, but he should have expected to be so. Realtors have a deservedly poor reputation, and in this case (as is most often the case) they were representing the owners, not the renter.
I am also surprised that the author would pay $4k a month for a rental cottage, working in a precarious industry like journalism. It makes me feel better about my $2800 mortgage payment for a small Long Island house.
The author was misled, but he should have expected to be so. Realtors have a deservedly poor reputation, and in this case (as is most often the case) they were representing the owners, not the renter.
3
I am wondering, as I read this, if unethical practices have over time become regular business practices of the real estate industry. I recall the process of searching for and then buying the house I currently live in. My first two offers, for the asking price of two other houses that I absolutely fell in love with, were met with acceptance but the same reluctance to formalize the deals via a contract of sale. It soon became clear that the sellers, having realized they could get the asking price, preferred to wait to see if they could get more.
Then I saw the house I ended up buying. I made an offer and was told by the RE agent that he would relay it to the seller. On my way home, I got a call from him saying he really thought it would be better if I increased my offer, to increase the likelihood of the seller accepting it--this before the initial offer had even been passed along to the seller. Luckily for me, I relayed this request to my sister, who'd recently been through the ropes buying her own house. She told me to ignore him, he was just looking to increase his commission--wait to see what the seller said to my first offer. Excellent advice, as the seller accepted. So every party was happy except my RE agent, who wanted a higher commission (and was clearly willing to put his interests before mine, had I been ignorant enough not to realize it).
Then I saw the house I ended up buying. I made an offer and was told by the RE agent that he would relay it to the seller. On my way home, I got a call from him saying he really thought it would be better if I increased my offer, to increase the likelihood of the seller accepting it--this before the initial offer had even been passed along to the seller. Luckily for me, I relayed this request to my sister, who'd recently been through the ropes buying her own house. She told me to ignore him, he was just looking to increase his commission--wait to see what the seller said to my first offer. Excellent advice, as the seller accepted. So every party was happy except my RE agent, who wanted a higher commission (and was clearly willing to put his interests before mine, had I been ignorant enough not to realize it).
18
That RE agent you talked to represented the seller, not you. There was nothing unethical in that transaction. You just didn't know.
1
He was looking to increase his commission? Was this a million dollar home and you were increasing your offer by hundreds of thousands? At 6% (which is the highest, the rate may have been 3, 4, or 5% where you are), a $10,000 which would have meant a $150 increase. This is what happens when people with no experience in real estate consult with other people who have no experience in real estate. In a hot market it is not unusual for buyers to offer over list for a home, and I have represented buyers who have lost out because OTHER BUYERS followed their agent's advice and increased their offers. If you don't mind, please tell us your offer and the amount your agent wanted you to increase it to, in order to pad her fee. Remember that your agent would likely only have received one quarter of that fee, depending on their split with the agency. Minus taxes of course.
CAARE is the only non-profit charity dedicated to consumerism with real estate brokers. It is our belief that the brokerage industry is the most corrupt industry in the United States. We do not believe that most brokers are honest and that their ethics training have anything to do with ethics.
* Realtors are the 2nd most powerful lobby group in the U.S. They write their own laws and those laws are designed to protect them from consumers, not the other way around.
* Commissions are fixed outrageously high by forcing consumers to pay two commissions instead of one. Commissions are 1-2% in England.
* Home inspectors, mortgage bankers, title companies, and residential real estate attorneys get most of their referrals from Realtors. They serve to make sure the commission gets paid and little else. The best ancillary real estate services are typically boycotted out of business and labeled "deal killers."
* Realtors control the regulators and are even exempted out of the CFPB's authority.
* Realtors are incentivized to expose you to conflicts of interests that are illegal in any other profession. Think dual agency.
There is so much more. If you want to avoid problems, only use small brokerage firms, insist on negotiating all aspects of the commission, consider discount and rebate brokers, look for exclusive representation, hire ancillary services that are completely independent of the brokerage firms and never use a friend or relative unless you are willing to sue them.
* Realtors are the 2nd most powerful lobby group in the U.S. They write their own laws and those laws are designed to protect them from consumers, not the other way around.
* Commissions are fixed outrageously high by forcing consumers to pay two commissions instead of one. Commissions are 1-2% in England.
* Home inspectors, mortgage bankers, title companies, and residential real estate attorneys get most of their referrals from Realtors. They serve to make sure the commission gets paid and little else. The best ancillary real estate services are typically boycotted out of business and labeled "deal killers."
* Realtors control the regulators and are even exempted out of the CFPB's authority.
* Realtors are incentivized to expose you to conflicts of interests that are illegal in any other profession. Think dual agency.
There is so much more. If you want to avoid problems, only use small brokerage firms, insist on negotiating all aspects of the commission, consider discount and rebate brokers, look for exclusive representation, hire ancillary services that are completely independent of the brokerage firms and never use a friend or relative unless you are willing to sue them.
2
Twice, while attempting to buy a house in CT, the seller accepted a verbal offer, the actual contract having to be drawn up by an attorney and not yet available to sign. After they received the contract, they were told that the seller had received a higher offer - either meet it or lose the deal. One seller actually told my son who knew it wasn't ethical, but it was legal and he was doing it.
To me, the most unethical part is realtors not using a standard Board of Realtors template contract which is signed by the person making the offer. Any special contingencies can be added. If the seller accepts the contract, they must sign it, too. All contract are typically subject to inspection. Why on earth someone must pay $1000-1500 - perhaps more now - to be provided with a contract that one knows is right there on the attorney's computer, when a standard one would suffice and prevent these last minute glitches of higher offers after verbal acceptance, I cannot imagine. The lawyers must have one hell of a strong lobby to pull this off. No where in the midwest that I know of, does such nonsense exist.
To me, the most unethical part is realtors not using a standard Board of Realtors template contract which is signed by the person making the offer. Any special contingencies can be added. If the seller accepts the contract, they must sign it, too. All contract are typically subject to inspection. Why on earth someone must pay $1000-1500 - perhaps more now - to be provided with a contract that one knows is right there on the attorney's computer, when a standard one would suffice and prevent these last minute glitches of higher offers after verbal acceptance, I cannot imagine. The lawyers must have one hell of a strong lobby to pull this off. No where in the midwest that I know of, does such nonsense exist.
5
The author should have gotten something in writing. And his agent should have told him to keep looking until he got it in writing.
Commission-based agents in any industry have an inherent potential conflict of interest. They get paid only if the deal closes. And the higher the price, the better the commission. So it may be in their best interests to see a closed deal but not necessarily in the client's best interest.
Buyer beware. Trust but verify. Some realtors are unethical. Some are young and inexperienced. Some are lazy and ignorant. And then again some represent unethical and/or ignorant clients.
If you want to get a dismal view of humanity do a real estate transaction. Artfully placed furniture or a good paint job can hide flaws. Home inspectors may miss these flaws intentionally or otherwise. (They get paid by the buyer but get referrals from the broker.) Just think about the sellers who hides flaws so they can get a higher price. Sold their soul to the Devil for a few pieces of silver.
There are good, ethical real estate agents out there. But there are a lot who are not. And remedies are often difficult to obtain, time-consuming and costly. So, trust but verify. Get it in writing. If something sounds too good to be true, it probably isn't. And be prepared to walk away.
Commission-based agents in any industry have an inherent potential conflict of interest. They get paid only if the deal closes. And the higher the price, the better the commission. So it may be in their best interests to see a closed deal but not necessarily in the client's best interest.
Buyer beware. Trust but verify. Some realtors are unethical. Some are young and inexperienced. Some are lazy and ignorant. And then again some represent unethical and/or ignorant clients.
If you want to get a dismal view of humanity do a real estate transaction. Artfully placed furniture or a good paint job can hide flaws. Home inspectors may miss these flaws intentionally or otherwise. (They get paid by the buyer but get referrals from the broker.) Just think about the sellers who hides flaws so they can get a higher price. Sold their soul to the Devil for a few pieces of silver.
There are good, ethical real estate agents out there. But there are a lot who are not. And remedies are often difficult to obtain, time-consuming and costly. So, trust but verify. Get it in writing. If something sounds too good to be true, it probably isn't. And be prepared to walk away.
5
Recently I had two property management firms attempt a bait and switch on me. In my town where rentals are very scarce, brokers commonly post an ad on craigslist that includes lease term options and monthly rent. They show you the property, have you sign a bunch of forms and pay for a credit check and arrange to have you come back for the lease signing. But in between they call and say the rent is now X + $300 and the lease is only for 9 months not a full year. Both times threatening to report to the better business bureau got them to revert to the original terms. Tip: always print hte advertisement and make sure the posting date is on it.
55
NEVER pay any attention to a property listing on Craigslist. That's the playground of scammers who take information from legitimate listings and create their own fake listing. They want you to sent the checks to Africa or some other country. It's a well known problem in my state.
2
Real estate agents have only one client: themselves. Buying and selling advice is always in the best interest of the broker. The bigger the commission, the quicker they will lock down the deal and advise the client to do the same. For smaller issues (like this), they are rewarded by locking in a base commission and creating competition until it's too late. The more competitive the market, the more risk they will take on the smaller deals while forcing through their own large deals to block losing out.
Some day soon they will be irrelevant.
Some day soon they will be irrelevant.
9
Good luck selling your own house, Gio.
Why have you not filed the appropriate complaints? And why has your agent not done so? The other agent lied to your agent. That is against the rules everywhere.
Have you informed every other agent in the local MLS? You should.
Reputation is EVERYTHING as far as other agents are concerned.
The agent that did this NEEDS to be taught a lesson.
Naming names in the NYT is NOT appropriate. A focused email to the rest of the agents in the local community is.
Have you informed every other agent in the local MLS? You should.
Reputation is EVERYTHING as far as other agents are concerned.
The agent that did this NEEDS to be taught a lesson.
Naming names in the NYT is NOT appropriate. A focused email to the rest of the agents in the local community is.
5
You are assuming it was "the other" agent that lied.
When there are four parties to the transaction, you have no idea where the truth got bent. As an owner, I would only rely on the document, signed by both parties. All else is talk. (The fellow almost seems to be a professional)
When there are four parties to the transaction, you have no idea where the truth got bent. As an owner, I would only rely on the document, signed by both parties. All else is talk. (The fellow almost seems to be a professional)
1
Not that I don't sympathize with you, I do, but you probably should have simply withdrawn from the deal. You might have found that you were being bluffed and gotten the property at your price. If that didn't work, you could have kept looking and maybe still found an acceptable property at your price. If that didn't work, you could have stored your possessions and moved into a motel and kept looking. That's a heck of a lot cheaper than the extra $9,600 you spent on the increased rent. If, after that, you didn't find the right place, that's a pretty good indication that the extra $200 was probably a fair price even though not the bargain you expected. And if it was a bargain, you were beating the landlord out of a fair price and should have known how to nail down the bargain. After 28 moves you probably should have picked up a little more sophistication along the way. A contract relating to real property is not enforceable unless in writing. Also, the agent's loyalty is to his client, not you, that's pretty basic stuff. Ethics aren't laws and even if you won that fight would only have gotten the realtor in hot water but not gotten your original deal. Like I said, you were the victim log a sharp trader, but in a world where everyone looks down their noses at lawyers, car salesmen and real estate agents, if you choose not to have a professional in your corner, you should not complain about the results of taking your own advice.
24
It was an extra $400 -- it started out as $200, but the realtor and owner kept "playing" Mr. Miller after figuring out how naive and desperate he was.
He paid $4000 a month for a $3600 cottage -- when his ORIGINAL cottage just down the street was only $2600!
DO THE MATH.
He paid $4000 a month for a $3600 cottage -- when his ORIGINAL cottage just down the street was only $2600!
DO THE MATH.
If the author has all of his self-proclaimed experience and knowledge, why didn't he get it in writing? Answer, he just assumed everything was okay while knowing it wasn't. Do stupid things and you must blame yourself, not others.
16
In my illustrious career I've been a Realtor, and always strove to treat everyone fairly and ethically. I've been out of the business for many years, and after reading this article am wondering why Realtors and realtors are held to such a high standard of ethical conduct when both presidential candidates this time around are lacking in that area? Does ethics only apply to a real estate salesperson or broker?
Consumers have to use their heads, and protect their interests. If you involve yourself in a real estate transaction, any real estate transaction, common sense dictates that IT MUST BE IN WRITING.
You can't blame a so called real estate "professional" for your own ignorance. Whenever you are involved in any real estate transaction GET IT IN WRITING or you have nothing. All you can do, if you get taken advantage of, and there's a good chance that you will, is complain.
Consumers have to use their heads, and protect their interests. If you involve yourself in a real estate transaction, any real estate transaction, common sense dictates that IT MUST BE IN WRITING.
You can't blame a so called real estate "professional" for your own ignorance. Whenever you are involved in any real estate transaction GET IT IN WRITING or you have nothing. All you can do, if you get taken advantage of, and there's a good chance that you will, is complain.
5
What I am hearing from your comment is, "assume the real estate agent is lying to you."
6
Sounds like a case for Judge Judy.
10
We bought a large house in a small Georgia town from the estate agent assigned to us by our employer relocating us. A year later, we were moved again and she was designated to sell the house again. We received $45K less than we had bought it for one year earlier, and this despite our considerable work redecorating the house, which our agent gushed over. And this was in 2004, during the famous boom years.
Our employer was, of course, the victim, since we were "made whole", compensated for our loss. But our breaths were taken away by the tactics we saw. The buyer was brought by our agent's colleague in the firm, a very close friend of the buyer, permitting the entire fee to be collected by this firm. An inspection was performed without notice or permission while we were abroad; it found that our siding had been declared defective in a court settlement several years prior. What? We were not given a contract nor were other perspective buyers brought for weeks, until I threatened to bring one myself. The buyers and their agent later entered the property unannounced with a pass key on a Sunday morning while we were present; they even hilariously asked us to leave certain furnishings they fancied (we did not).
This family subsequently fell apart, stunning karma, but the agent continues to flourish.
Our employer was, of course, the victim, since we were "made whole", compensated for our loss. But our breaths were taken away by the tactics we saw. The buyer was brought by our agent's colleague in the firm, a very close friend of the buyer, permitting the entire fee to be collected by this firm. An inspection was performed without notice or permission while we were abroad; it found that our siding had been declared defective in a court settlement several years prior. What? We were not given a contract nor were other perspective buyers brought for weeks, until I threatened to bring one myself. The buyers and their agent later entered the property unannounced with a pass key on a Sunday morning while we were present; they even hilariously asked us to leave certain furnishings they fancied (we did not).
This family subsequently fell apart, stunning karma, but the agent continues to flourish.
35
Let me guess you worked for The firm know as I be moving. Their agent steered a friend of mine who happened to be of Hispanic decent but a US citizen to no torus Franklin Rd. The most epic case of red lining I have ever seen. Since, I be moving hasn't transferred him again he has been trapped in the middle of gang wars. Thing the city is buying up and tearing down some of the worst apartments and now Arthur Blank is building a new Soccer complex.
The Lousina Pacific siding a product bought to the market by the Koch Brothers, should have been disclosed by the sellers and the agent!! It also should have been caught by the inspector. ANy house built in Ga during the late 80's and late 90's that has not had its siding replaced with hardiplank or similar should be a big warning sign of do not buy or get a $6 to 10k credit to replace, the siding. You also need to check for polybutylene pipes in GA.
The Lousina Pacific siding a product bought to the market by the Koch Brothers, should have been disclosed by the sellers and the agent!! It also should have been caught by the inspector. ANy house built in Ga during the late 80's and late 90's that has not had its siding replaced with hardiplank or similar should be a big warning sign of do not buy or get a $6 to 10k credit to replace, the siding. You also need to check for polybutylene pipes in GA.
Spineless? Why not name names? Seems under-handed and motivated by personal animus without the courage to be direct.
11
I have been in this situation and when not presented with a signed contract, I credibly threatened to walk. I just said, either we have a deal or we don't, and if we do, let's sign, and if we don't, we'll keep on looking. They called my bluff and my girlfriend at the time (now wife) and I walked out of the office and said we would be using a different agent to find an apartment. I don't know exactly what happened, but the next day we had a signed contract.
47
Congratulations, you did it right.
BTW. your condition was not a bluff; they called your hand.
BTW. your condition was not a bluff; they called your hand.
2
This is the key piece of advice. Determine your limits - in time, in money, in terms and conditions, in demands from the buyer or seller or landlord - and walk if they are not met. If you allow yourself to be strung along, then you haven't reached your limit. And be decisive when communicating to your agent that he or she just crossed the line; there should be no belief on the part of the agent that you are anything but resolved.
I have done this twice - once on the sale of our house, and once on a re-finance which the mortgage company's credit process was making overly complex. Both understood that when I gave the ultimatum that they fix the situation fast or the deal was off, that I meant it. The problems were resolved.
I have done this twice - once on the sale of our house, and once on a re-finance which the mortgage company's credit process was making overly complex. Both understood that when I gave the ultimatum that they fix the situation fast or the deal was off, that I meant it. The problems were resolved.
1
The lowest I encountered: went to see a rental. had a 10 minute walk through with a realtor i never met before. said i would like to take the place, would let her know definitely the next day. went to university and got mugged and spent the night in the hospital with a head injury. did remember to call realtor in the morning and say i wasn't up to making that commitment given the incident. was served a subpoena shortly afterward demanding full commission for breaking an unwritten verbal indication of maybe renting. had to appear in small claims court three times while realtor sent her parents in her stead asking for more time to make her case. wound up having to pay $100 assigned by the arbitrator to make her go away and leave me alone, though she hadn't appeared once in her own behalf. had not signed anything. had not tied up the apartment between 7pm when i saw it and 9am when i called to beg off. i wish i could remember her name and print it here - 36 years later - she would deserve it.
74
As a former Realtor, I see all kinds of problems with this situation. (My ranting tone matches that of the article)
First of all, a lease is a contract that follows with the property. It is in my state. In other words, the original landlord must transfer the lease with the deed to the new owner. The new owner is obligated to honor the terms of the lease for its duration, unless the affected parties agree to changes in that contract. It's the law and the author had a contract. He could have easily told the original landlord that he wished to continue with the current lease until it expired, UNLESS it was stipulated in the lease document otherwise.
Of course the buyer may not have wanted to buy the house in that case. That's the landlord's problem to solve. The point is that the author had options and protections he didn't bother to know about.
Secondly, it is wise and entirely acceptable to ask a real estate agent you are working with who she represents in that particular transaction. Pay attention to the answer. If they lie you can sue them and file a legitimate complaint with the state. There are customers and clients. Find out which one you are with that agent.
First of all, a lease is a contract that follows with the property. It is in my state. In other words, the original landlord must transfer the lease with the deed to the new owner. The new owner is obligated to honor the terms of the lease for its duration, unless the affected parties agree to changes in that contract. It's the law and the author had a contract. He could have easily told the original landlord that he wished to continue with the current lease until it expired, UNLESS it was stipulated in the lease document otherwise.
Of course the buyer may not have wanted to buy the house in that case. That's the landlord's problem to solve. The point is that the author had options and protections he didn't bother to know about.
Secondly, it is wise and entirely acceptable to ask a real estate agent you are working with who she represents in that particular transaction. Pay attention to the answer. If they lie you can sue them and file a legitimate complaint with the state. There are customers and clients. Find out which one you are with that agent.
9
Glen
Bryan was moving to help his landlord out. He was being a mensch.
Bryan was moving to help his landlord out. He was being a mensch.
He didn't know any better, otherwise he would have mentioned it. There are ways to settle these situations for all concerned. His landlord was taking advantage of his ignorance.
2
"...the prospect of a complicated, drawn-out process is off-putting...."
No, processing an Ethics complaint consists of one hearing, usually within, 60 days, and you're done. I've analyzed and/or arbitrated hundreds of Ethics complaints and they go either way. Nearly all agents are fair and honest, but a few are in it for the money by any means
As an expert witness in lawsuits involving real estate licensees, I've seen conduct where agents have improperly taken advantage of buyers and sellers. And others where agents are unfairly charged by buyers and sellers whose greed and poor decisions led to costly outcomes.
In Miller's scenario, it is unfair to put the full blame on the owner's listing agent, because a decision to delay signing a lease must have the owner’s approval. There seems to be no question, though, that he lied to Mr. Miller -- always unethical.
….TIPS
1. In your offer, add a definite closing date for signing binding documents, after which the offer is void and the deposit returned. Walk while you still have options.
2. Request written confirmation of oral agreements -- emails will do. Then confirm those to the sender in writing,
3. Write down notes of ALL conversations and events when they happen, adding time and dates to your record. These are invaluable when you must make your case. I use Windows' Notes program found in Accessories. F5 lays down the time and date.
4. In many states, the owners/sellers are liable for the actions of their agents.
No, processing an Ethics complaint consists of one hearing, usually within, 60 days, and you're done. I've analyzed and/or arbitrated hundreds of Ethics complaints and they go either way. Nearly all agents are fair and honest, but a few are in it for the money by any means
As an expert witness in lawsuits involving real estate licensees, I've seen conduct where agents have improperly taken advantage of buyers and sellers. And others where agents are unfairly charged by buyers and sellers whose greed and poor decisions led to costly outcomes.
In Miller's scenario, it is unfair to put the full blame on the owner's listing agent, because a decision to delay signing a lease must have the owner’s approval. There seems to be no question, though, that he lied to Mr. Miller -- always unethical.
….TIPS
1. In your offer, add a definite closing date for signing binding documents, after which the offer is void and the deposit returned. Walk while you still have options.
2. Request written confirmation of oral agreements -- emails will do. Then confirm those to the sender in writing,
3. Write down notes of ALL conversations and events when they happen, adding time and dates to your record. These are invaluable when you must make your case. I use Windows' Notes program found in Accessories. F5 lays down the time and date.
4. In many states, the owners/sellers are liable for the actions of their agents.
12
We just sold our home and had to deal with some very paranoid buyers who were fueled by their aggressive agent. We found out several times, they had gone inside our house a half a dozen times without our knowledge (using lockbox). In fact, two hours before our closing, they insisted on doing a 'final walkthrough'. The saw a broken tile and began complaining that it must have just happened (it was there when we bought the home 25 years ago) and wanted a reduction to the sales price! We had to negotiate the price down $500 in order for them to close! I first had my real estate license in 1976; I hadn't seen buyers or agents that were as obsessed as these people were!
It's a stressful time - we know that.
It's a stressful time - we know that.
20
"In fact, two hours before our closing, they insisted on doing a final walkthough".
You say this as if it is unusual. Final walkthoughs are done every day.
You say this as if it is unusual. Final walkthoughs are done every day.
Why is the Times so scared that it doesn't want us to mention company or individual names? This article is about 1% as effective as it could be if it named the agent and firm that lied to the author. I don't see the Haggler column holding back such information. No one will be surprised by the behavior in this story and the Times is doing absolutely nothing to stop it by citing non-binding codes of ethics policed by the industry or toothless government agencies with no real power.
Maybe it's because the Times gets much more advertising revenue from real estate than from car rentals, computer repairs or almost any other industry?
Maybe it's because the Times gets much more advertising revenue from real estate than from car rentals, computer repairs or almost any other industry?
13
I have a dream ... If only all realtors were as ethical as the Property Brothers !
"My agent forwarded my offer to the owner’s agent, who responded within hours that it had been accepted." Your problem is right here, as this sentence is meaningless. How exactly did you think the agent had responded? You know that in real estate, as in most other things involving formal contracts, there is no such thing as verbal agreement. Why would you put yourself and your family at risk and tell your current landlord that you're moving? It sounds to me like you're upset because you exercised terrible judgement, and now you're trying to blame someone else. Look in the mirror, friend.
8
Your scenario leads to a world in which no one can trust the word of another person until it is in writing. No one should believe what another says, and if it turns out the other has lied, it's the trusting person who is an idiot, not the liar.
I prefer to believe that trust is good, that people should be proud of their character when their word is their bond, and that liars are much more at fault than trusters. That's the world I would rather live in.
I prefer to believe that trust is good, that people should be proud of their character when their word is their bond, and that liars are much more at fault than trusters. That's the world I would rather live in.
1
You got a problem with Capitalism?
Next time move to Norway.
Next time move to Norway.
7
Nothing surprising in this article. Perhaps just the tip of the proverbial corrupt world of real estate. I'm wondering if NYS has subpoena power like CT. Then one could find out if there actually were lots of other competing bids, or maybe find out if you were bidding against yourself.
5
Yes, you should have realized that nothing is true until it is in writing. But "the cottage is yours" was an absolute lie, meant to stop you from continuing your search for a new home and to put you in the exactly difficult place you found yourself in - needing to move quickly and without options other than paying the inflated price.
The only thing to do if an owner's agent refuses to sign a lease immediately after accepting an offer verbally is to make it clear that you are going to continue your search as well. Of course the law works two ways - you are also free to withdraw your offer at any point before it is accepted in writing if you find a better place.
Moves like this are why I never use a real estate agent. Even as the landlord/owner, I would have been horrified and embarrassed by this tactic used on my behalf by an agent.
The only thing to do if an owner's agent refuses to sign a lease immediately after accepting an offer verbally is to make it clear that you are going to continue your search as well. Of course the law works two ways - you are also free to withdraw your offer at any point before it is accepted in writing if you find a better place.
Moves like this are why I never use a real estate agent. Even as the landlord/owner, I would have been horrified and embarrassed by this tactic used on my behalf by an agent.
8
First, my apology that this happened to you. Second, thank you for an informative article. I've been involved in real estate education for thirty years and true professionals in the industry hate when something like this happens. If how to buy or lease a house was taught in high school these situations could be avoided. The statute of frauds requires the transfer of any interest in real estate to be in writing, and that includes leases. Your agent should have insisted on an agreement in writing and when the owner's agent wouldn't agree to that, your agent should have informed you of the possibility that other offers were being accepted. Agents are not lawyers and cannot inform you of your legal rights, but he/she can educate you as to the process and explain your options. All agents are not the same. Use due diligence in securing an agent for any transaction. Ask how long he/she has been in the business and referrals. Also, evaluate their website and credentials. The "alphabet soup" after their name really does mean something. Create a relationship now with an agent who will provide excellent service representation when you need him/her in the future. A good agent is worth their weight in gold!
10
My own personal experience with multiple homes, apartments, and condos( and their agents) during a career that required frequent moves is that "realtor ethics" is an oxymoron on par with "military music". Never ever let your guard down for a second. Get everything(EVERYTHING) recorded somehow. Do not trust, but always verify. Be very clear and direct in all communications. Do not worry about offending them. You're dealing with a profession that attracts wheeler-dealers with fins on their backs who live for blood in the water. If you leave an opening or a vulnerability, they will exploit it. Don't expect anything different.
20
Can a lawyer among us clarify why accepting the author's offer of $3,600 didn't create a binding oral contact? It seems to me that the homeowner and agent were both bound as soon as they said "yes."
2
Because in most states, contracts involving real estate must be in writing and signed in order to be valid and enforceable.
4
Verbal contracts are not real estate contracts. For a real estate contract to be binding it has to be in writing. It can be any kind of writing including a bar napkin, but it must be written down and signed with some kind of conservation being offered and accepted. That's California law. New York is probably the same.
3
ASSUMING that the lease was for a period in excess of one year, the author ran into something called the "statute of frauds" that states that a contract that cannot be completed within one year must be in writing.
4
It is hard to sympathize with someone who has $4,000 to spend on renting a place. Move to my town.
20
I certainly noticed that, considering that the average real estate agent ends up working for less than minimum wage.
1
Is it hard to be a tenant when the owner or agent or both have been so unethical????
2
Particularly true when dealing with a Homeowners Association. Realtors will tell the buyers almost anything. As a retired builder I have seen realtors tell people the most outrageous things - directly contradictory to the covenants and bylaws of the property. Unfortunately, many buyers never check the actual covenants. Caveat emptor.
9
Ah, yes, homeowners associations. That's a subject for an entirely different article.
Being that this article is being published in the New York Times, everyone reading it should note that in NYC, many agents are members of the Real Estate Board of New York (REBNY), which is a membership organization similar to the National Association of Realtors. But because we're members of REBNY and not NAR, we're not referred to as Realtors. At REBNY, we also have a Code of Ethics and mandatory ethics training for all members. In NYC, you should ask if your agent is a REBNY member.
Stacey Max
Sales Manager
BOND New York Properties
Former elected member of the REBNY Residential Board of Directors
(212) 645-8800
Stacey Max
Sales Manager
BOND New York Properties
Former elected member of the REBNY Residential Board of Directors
(212) 645-8800
Regarding Sales and Realtors my coop sold 2011 in NYC ..........it was to say the least, agonizing as I discovered what can go wrong...and what is withholding of info crucial to my sale....being generally ignored and condescended to..ok my comment is simply NYSR includes a clause in every contract that gives all brokerages the right to Dual Agency........google the myriad of conflicts of interest that go down with this if your lawyer doesn't get it.....limited exposure,
doubling commission,.....How can u be ethically responsible if u represent both sides........Bait and Switch.....do not respond to any other inquires,thrown under the bus..........
doubling commission,.....How can u be ethically responsible if u represent both sides........Bait and Switch.....do not respond to any other inquires,thrown under the bus..........
1
As a retired Realtor, I can attest that there are enough bad apples in the real estate barrel to give the profession a bad name. But having dealt with dozens of fellow agents over the years, I can also state unequivocally that the unethical ones are in the extreme minority. The vast majority of my real estate deals went through rather smoothly, simply because of the dedication and cooperation from the Realtor on the other side of the table -- just as much as my own adherence to the highest ethical standards. Thanks, Bryan, for shedding a spotlight on stuff that can go wrong, especially when events are easily fixable. Always make sure you discuss with your agent how to respond when negative news impacts your deal. The objective is always to get what you want, but do so in a way that remains honest and fair. That goes for buyers, sellers and renters as well as agents.
4
I believe offers are required to be signed. No verbal offers are enforceable by statute at least in NY. What this points out is that the Real Estate Boards themselves are unethical to allow these tactics to prolificate. And prolificate they have- including the buying and selling of real estate. It astounds me that Realtors and the whole industry was never examined in the build up to the economic collapse. As had been the policy ever buyer is to be qualified before he even looks at a property. And then the agent is involved ushering the buyer thru the mortgage process. How is it even possible that many sales could have occurred without compliance on the behalf of Realtors? Its an industry that resists any oversite and escaped tax scrutiny because it insists that agents are independant contractors. The whole industry is completly dishonest to an astounding degree.
11
When both the buying agent and the selling agent are paid a commission based on the sales price, they obviously both want the price paid to be as high as humanly possible. Therefore, if you are a buyer, you need to understand that everyone's incentives go against what you want, which is to pay the lowest price. This is sickening, considering the buyer's agent should have incentives to represent the buyer's wellbeing.
12
A buyer's agent has the fiduciary duty to look after the best interests of his client. Just make sure the agent really is your agent. It's the law, not just an ethics issue.
7
Actually they don't want the price to be "as high as is humanly possible". They just want to sell the thing. Since each gets about 1.5% of any increase, it's hardly worth the extra work to obtain any increase. So they don't do the extra work; they just hammer the deal closed.
3
While it is possible to have a real buyer's agent, to whom the buyer is paying a fee, in most cases there are just multiple seller's agents, ultimately paid by the seller out of the proceeds of the sale.
A thought from a real estate lawyer (not to be taken as legal advice): carry around a simple document while house or apartment hunting where the agent selling the home promises to stop marketing the property after saying the home is yours. Have the text ready to email where the agent will have to reply. In some jurisdictions the reply will be as good or almost as a pen and ink signature. Put in blanks for the name of the agent and the property so it's clear who is promising and what about. That way, if the agent plays this game, he or she is in privity with you contractually as to a promise he or she can actually make, not to MARKET the property further or take other offers; if you are damaged by a breach, in theory you might have a better chance of nailing the agent for damages, especially if you have to pay more for something comparable. Without the owner's signature, you may not get the place, but you could possibly spank the agent. Or at least ruin THEIR day. If the agent won't sign or reply in writing it's a tell tale sign and I'd go plant myself on the owner's doorstep until you get that signature.
23
Very good suggestion.
Thank you.
Thank you.
I would at least get a text from the selling agent stating I had the deal. Also did the seller get a deposit, if so I would expect that would clinch the deal. I hate to say it but where money is involved all nets are off
4
ne rental agent where I made out six thousand in cashiers checks included one mos rent for getting me in the building due to low credit rating 560 I believe ..this with selling my coop....i think I spent at least 8000 dollars for the landlord to insure my ability to pay after forty yrs in my coop on 62nd street..i cancelled the contract after almost being run over by a motorcycle on the sidewalk and at nite walking thru tenements from the bus top I left ole New York city and frankly felt a bit raped..my coop listed at 645,000 2006......sold 345,000 oct 2011....
3
"...the rules in the National Association of Realtors’ code of ethics are often vague and difficult to enforce.
'I kind of ignore those and go by statutes and regulations,'..."
Exactly. Professions, including the one to which I belong as a CPA, know that legality is all that matters and if they can force a complainant into arbitration, all the better. Even the required continuing education in ethics is largely a review of potential legal liability.
The purchase of my home was handled through an attorney who, along with the Realtor, knew full well the seller did not have clear title to the property. We're all lucky the issue got resolved on its own. Never trust anyone who would make more money by deceiving you than by being honest.
'I kind of ignore those and go by statutes and regulations,'..."
Exactly. Professions, including the one to which I belong as a CPA, know that legality is all that matters and if they can force a complainant into arbitration, all the better. Even the required continuing education in ethics is largely a review of potential legal liability.
The purchase of my home was handled through an attorney who, along with the Realtor, knew full well the seller did not have clear title to the property. We're all lucky the issue got resolved on its own. Never trust anyone who would make more money by deceiving you than by being honest.
3
Realtors pretend to be professionals but many are just hustlers.
65
Aren't (almost) all salespeople just hustlers?
1
The writer had me until "pool club." How about applying some of that money to your rent?
8
A close, highly-principled friend left the faculty of a major music conservatory to go into real estate in 2005, a time when agents had a particularly dishonorable reputation for pushing inflated appraisals, no-doc loans, etc. "Conservatories are a dishonest business in a sense: to keep your job you must recruit graduate students by giving them the impression that they have a professional future that the vast majority will not have."
"Are you saying that you find real estate a more ethical profession than teaching piano?" I asked.
She paused, only briefly, before saying, "Yes."
We both sat quietly for a bit before changing the subject.
"Are you saying that you find real estate a more ethical profession than teaching piano?" I asked.
She paused, only briefly, before saying, "Yes."
We both sat quietly for a bit before changing the subject.
5
Why did you vacate your lease early? Without a court order your landlord had no right to make a request that you vacate your rental home.
14
This is true for life, not just real estate. Get everything in writing!!! Everything!
Our real estate agent was on the opposite end of this; he had agreed that the builder would repair damage to our house for $500. I thought that was too low, so we built that into our contract. Our realtor never got the quote in writing and the builder said "actually it's $5000". then our agent was stuck covering the difference.
Our real estate agent was on the opposite end of this; he had agreed that the builder would repair damage to our house for $500. I thought that was too low, so we built that into our contract. Our realtor never got the quote in writing and the builder said "actually it's $5000". then our agent was stuck covering the difference.
3
Huh? Who doesn't know this?
4
I have had positive experiences with real estate agents upon the purchase of two of my homes; however the same cannot be said for my rental experiences. Real Estate agents provide absolutely no value in a rental arrangement; from my experience what they do is protect the owner from having to reject a prospective tenant and weed out the classes of people they don't want to lease to (Sound discriminatory?) It absolutely irked me that I had to pay a real estate agent one month's rent to 'show' me an apartment, which 99 times out of 100 was the first time they saw the same apartment as I. They knew nothing of the owner, nothing of the neighborhood at times and merely were just collecting a fee for a very easy task. Even less understandable is having an agent be party when dealing with renting in a huge building. I have to pay a fee to them for what, exactly?
4
There is such a thing as a verbal contract. Offers do not rise to this but accepted offers certainly do. Ask a lawyer, not a realtor, for an opinion as to whether a realtor's acceptance as an agent for the owner is an effective verbal contract.
4
There's no such thing as an "effective verbal contract" when real estate is involved. The law requires that such contracts be in writing in order to be valid and enforceable.
4
You NEED to file a complaint. To not do so is an endorsement of the status quo. If you won't, who ever will?
And you could probably get an article or two out of the process. Instead, you do nothing but complain, and let the bad actor off the hook.
And you could probably get an article or two out of the process. Instead, you do nothing but complain, and let the bad actor off the hook.
The author may still have some redress against the agent/broker he was working with, not the agent/broker representing the owner. In New York State, all agents are required to present an Agency Disclosure Form to the parties they are working with. In this case, the form should have disclosed that Mr. Miller's agent was working on behalf of either the owner or the brokerage firm representing the owner. If Mr. Miller never signed such a form or signed one that didn't indicate the latter, he will be able to file a formal complaint and probably sue.
The disclosure form is designed to make buyers and tenants aware of exactly who the agent they are working with is actually representing. In many cases, the public assumes that the agent is working on their behalf.
That is NEVER the case unless the disclosure form specifically says that the agent is working for the buyer or, in this case, the tenant. In this situation, the buyer or tenant is the agent's client not merely a customer, which Mr. Miller was. Being an agent's client poses additional fiduciary responsibilities on the agent that are not present when the buyer or tenant is the agent's customer.
Had Mr. Miller been his agent's client instead of merely his or her customer, his agent would have had a duty to inform him of the possibility -- indeed the likelihood in a tight market -- that the owner was under no obligation to rent him the property until a lease was signed and was probably waiting for a higher offer.
The disclosure form is designed to make buyers and tenants aware of exactly who the agent they are working with is actually representing. In many cases, the public assumes that the agent is working on their behalf.
That is NEVER the case unless the disclosure form specifically says that the agent is working for the buyer or, in this case, the tenant. In this situation, the buyer or tenant is the agent's client not merely a customer, which Mr. Miller was. Being an agent's client poses additional fiduciary responsibilities on the agent that are not present when the buyer or tenant is the agent's customer.
Had Mr. Miller been his agent's client instead of merely his or her customer, his agent would have had a duty to inform him of the possibility -- indeed the likelihood in a tight market -- that the owner was under no obligation to rent him the property until a lease was signed and was probably waiting for a higher offer.
4
Unfortunately, verbal agreements mean nothing in Real Estate.
Get everything in writing if you are having discussions with agents, owners, co-brokers, etc.
A written record in the form of a letter or email, outlining in detail, the discussions, and verbal agreements and send copies to all parties involved will establish the facts and the timeline.
If none of the parties involved reply to your letter in writing your letter serves as a stand in agreement; though it does not have the power of a signed contract.
Documentation in the form of follow-up letters gives you leverage to keep a deal clearly defined and on track and may flush out any shift in negotiating positions that may take place and may serve as a basis for any complaint you may wish to file at a later date.
A signed contract gives you the most leverage in any dispute.
Get everything in writing if you are having discussions with agents, owners, co-brokers, etc.
A written record in the form of a letter or email, outlining in detail, the discussions, and verbal agreements and send copies to all parties involved will establish the facts and the timeline.
If none of the parties involved reply to your letter in writing your letter serves as a stand in agreement; though it does not have the power of a signed contract.
Documentation in the form of follow-up letters gives you leverage to keep a deal clearly defined and on track and may flush out any shift in negotiating positions that may take place and may serve as a basis for any complaint you may wish to file at a later date.
A signed contract gives you the most leverage in any dispute.
3
Realtors and Ethics. That is funny!
3
"When I expressed concern about the delay in signing the lease, the owner’s agent — whom I never met nor spoke with — informed my agent that there was nothing to worry about; the house was mine."
Hmm, is it Indeed a fact, that the owner's agent said "there's nothing to worry about; the house was yours", or is that what your (perhaps well intentioned but naive) broker inferred?
Even if the "reassuring" statements of the owner's broker were accurate - perhaps it was poor business but it hardly rises to a prime example of unethical behavior by a broker, especially if there was no binding monetary /written agreement.
The owner's broker is obligated to treat all parties honestly but their fiduciary duty lies with their client and getting them the highest price possible.
Unless the writer is certain that the competing bid was a rouse, I suggest that he/she find a better example of malfeasance.
Hmm, is it Indeed a fact, that the owner's agent said "there's nothing to worry about; the house was yours", or is that what your (perhaps well intentioned but naive) broker inferred?
Even if the "reassuring" statements of the owner's broker were accurate - perhaps it was poor business but it hardly rises to a prime example of unethical behavior by a broker, especially if there was no binding monetary /written agreement.
The owner's broker is obligated to treat all parties honestly but their fiduciary duty lies with their client and getting them the highest price possible.
Unless the writer is certain that the competing bid was a rouse, I suggest that he/she find a better example of malfeasance.
6
This type of behavior is not unique to real estate. It happens in every business deal, even personal relationships. If one goes through these deals with the attitude that we have "no choice" we will play the victim every time. One should learn the art of negotiation, and enter these deals with a few of ones own tricks, be firm with what we'll accept, and be fully prepared to walk away if our criteria are not met. There are often better deals all around, which we will never find if we aren't prepared to play hardball.
5
I agree that the owner's agent was probably unethical in how you were treated. Lesson: An agent's emphatic reassurances means little without the signature of his/her client in most, if not all, real estate matters. It's also true that it is the owner's agent's job to get the owner, his/her client, the highest price. However, I'd be interested to know of the exact guidance you received from your own agent regarding your having binding lease agreement. You did have one. They should have been keeping your expectations realistic, and instructing/warning you that the lease had to be signed by both parties to be binding. If they had, you would not have given your notice.
If you were informed by your agent that the property was yours, and they did nothing to stop you from giving notice to your present (at the time) landlord, then a lot of fault lies with them. It is your agent's job to protect you from such things, and give you good information, upon which you can make good decisions. It sounds to me as if your agent may have been inexperienced or inept, and did not afford you the protection you should have had. If they did warn you, then the fault lies with you.
If you did not try to revoke your "notice" to your landlord, and tried to recover damages in court, you might be in trouble, as you may have a responsibility to try to mitigate your damages. Maybe your landlord would have understood, providing you continued trying to find a place.
(CA R.E. Broker. Licensed since 1986)
If you were informed by your agent that the property was yours, and they did nothing to stop you from giving notice to your present (at the time) landlord, then a lot of fault lies with them. It is your agent's job to protect you from such things, and give you good information, upon which you can make good decisions. It sounds to me as if your agent may have been inexperienced or inept, and did not afford you the protection you should have had. If they did warn you, then the fault lies with you.
If you did not try to revoke your "notice" to your landlord, and tried to recover damages in court, you might be in trouble, as you may have a responsibility to try to mitigate your damages. Maybe your landlord would have understood, providing you continued trying to find a place.
(CA R.E. Broker. Licensed since 1986)
2
I have "encountered" numerous realtors over the years. My estimation is that 20% understand what it means to be in a fiduciary role/80% don't have a clue. In my opinion, the real estate industry is filled with some of the ugliest and least ethical people on the planet. Fortunately, working with real estate "professionals" is something I only do on rare occasions. When selling real estate I do it myself.
FSBO (for sale by owner). It is quite easy. First find an escrow company you like. If you are not comfortable drawing up a contract, have a lawyer to do it. Your preferred escrow company will have a lawyer, and some will even have a template for the contract. Beyond that, the buyer will likely want an inspection and need to have, or get, their funding in place, and you will need to choose a title company. Add the contingencies to the contract, get the deposit (earnest money), and hand it over to escrow. Then it is just about packing up and waiting - for the inspection, the funding, the close.
FSBO (for sale by owner). It is quite easy. First find an escrow company you like. If you are not comfortable drawing up a contract, have a lawyer to do it. Your preferred escrow company will have a lawyer, and some will even have a template for the contract. Beyond that, the buyer will likely want an inspection and need to have, or get, their funding in place, and you will need to choose a title company. Add the contingencies to the contract, get the deposit (earnest money), and hand it over to escrow. Then it is just about packing up and waiting - for the inspection, the funding, the close.
4
Realtor ethics, expertise, competence and professionalism are precious commodities. The ease with which some states issue real estate broker licenses make it easy for even unthoughtful operators to enter the real estate stream of commerce. With large amounts of money on the table, and 25 opportunities in each deal to save or waste money, even small errors are expensive and, for those who notice them, disappointing.
Like Mr. Mller, I tend to trust the word of business people I deal with, and 99 percent of the time my trust turns out to be justified. Living in a constant state of suspicion, expecting to be lied to at every turn, is a self-imposed toxic environment. But in those cases where I AM lied to, I take action. I file a complaint, I call the jerk's boss, or I publicize the event. I wish Mr. Miller had named the offending agent here and/or filed a formal complaint with the Realtors' association. When people fear they'll get called out or fired for unethical behavior, they'll be much less likely to do it.
20
The Statute of Frauds, a carryover from English common law, pretty much always requires that a contract relating to real estate be in writing signed by the party who is to be bound, but there are exceptions, including short term leases. The exceptions vary significantly from state to state, so ask your lawyer. I'm surprised the writer's realtor didn't point this out when the first offer was accepted. The owners' realtor may have been a little sleazy, but the renters' realtor was a little naive.
8
Many years ago, my mother's listing agent showed her several comparable homes that had sold in the neighborhood and recommended a list price. My mother agreed. The agent immediately found a buyer--another agent in the same brokerage. It was a full-price offer, so my mother signed the contract.
I later discovered that the listing agent had cherry-picked the comparable homes, selecting just those that had sold for low prices. I took this to the California Department of Real Estate, but I was told that the case was too insignificant for the Department to take up.
I next complained to the agent's managing broker. I don't know what came of that, but the agent (a "top producer") continued working for the brokerage.
I now know I should have taken my case to the local Board of Realtors. They wouldn't have done much, I suspect, but the hearing would have outed the listing agent as unethical to other agents (though not to the public). It would have been a small step towards cleaning up a sick profession, but many small steps can make a difference.
I later discovered that the listing agent had cherry-picked the comparable homes, selecting just those that had sold for low prices. I took this to the California Department of Real Estate, but I was told that the case was too insignificant for the Department to take up.
I next complained to the agent's managing broker. I don't know what came of that, but the agent (a "top producer") continued working for the brokerage.
I now know I should have taken my case to the local Board of Realtors. They wouldn't have done much, I suspect, but the hearing would have outed the listing agent as unethical to other agents (though not to the public). It would have been a small step towards cleaning up a sick profession, but many small steps can make a difference.
16
The results of all ethics hearings are private. No other agents would know the results. The offending agent's privacy is protected, no matter how bad the offense. But we on the panel know their identity and could write a book about what we see.
1
Having bought and sold multiple homes, I have found real estate agents to be a very sketchy group. Finding an ethical agent is as important if not more important than finding the right house or apartment and more difficult especially if your move involves going to a different city. There are some very unethical and dishonest ones, who tar all in the field.
4
Bryan, you're missing the actual reason the price of your rental went up $200 between offer and contract - it was the OWNER that asked for it. It makes no discernible difference in the agent's commission - 3800-4K. The agent was working at the instruction of the owner.
4
If this happened as you described I for one would like to know the name of the company and the name of the agent.This omission is a failing of current reporting in many areas.What ever happened to the truth setting one free?
5
There are exceptions to the rule that agreements must be in writing and you may fall into one of them. For example, if you acted in "reliance" on the agent's statement that you'd gotten the house, you may not need to have signed the written agreement for it took be effective. Since you did act in reliance when you agreed to move out of your then current rental, you may well have a l contract claim. And you may have other claims as well. Just because something is unethical does not mean that it may not also be a breach of contract or unfair trade practice. Note also that unfair trade practice laws which most states have often provide for attorneys fees and costs if you win. And they frequently include provisions like trebling of damages. I'd suggest you consult a lawyer.
6
Some years ago while driving on Route 24 in the hills west of Colorado Springs I passed a quite large sign overlooking the highway. It said, "We regret having done business with XYZ Real Estate." (They listed the real name and it wasn't XYZ, but I can't remember what it was.)
It seemed like wording their lawyer must have approved. No accusations, no possible libel. But so very clear and out in the public that XYZ was a outfit one should not do business with.
And think how useful it would have been in this article, for the author to have actually named who actions he considers appalling, instead of leaving them cloaked in anonymity.
The press has the opportunity to shine light on such practices, but you have to use it. And that means naming names.
It seemed like wording their lawyer must have approved. No accusations, no possible libel. But so very clear and out in the public that XYZ was a outfit one should not do business with.
And think how useful it would have been in this article, for the author to have actually named who actions he considers appalling, instead of leaving them cloaked in anonymity.
The press has the opportunity to shine light on such practices, but you have to use it. And that means naming names.
13
I know of an office here in Pa. Where the manager actually encouraged these tactics. The author did not lodge a complaint. He should have. Without complaints, this will never stop. A piece in the NYT is not sufficient.
6
Excellent article. Thanks for outlining your experience and the ways to file complaints. Thanks also for noting the difference between a Realtor and licensed real estate agent. That is something it seems very few people realize.
I have been a Virginia based Realtor for 13 years. What you describe does happen but honestly it happens with unrepresented landlords just as often. My husband and experienced this several times while renting in San Francisco before I was a Realtor.
The Realtor Code of Ethics and our local associations are there to handle these issues. I strongly encourage anyone who has been lied to or misled by a Realtor to file a grievance. If it happens with a direct landlord, I don't think there is anything to be done. However you will need proof and verbal promises are difficult to support and in many states unenforceable.
The biggest lesson is to understand that nothing is final until it is signed and in writing.
I have been a Virginia based Realtor for 13 years. What you describe does happen but honestly it happens with unrepresented landlords just as often. My husband and experienced this several times while renting in San Francisco before I was a Realtor.
The Realtor Code of Ethics and our local associations are there to handle these issues. I strongly encourage anyone who has been lied to or misled by a Realtor to file a grievance. If it happens with a direct landlord, I don't think there is anything to be done. However you will need proof and verbal promises are difficult to support and in many states unenforceable.
The biggest lesson is to understand that nothing is final until it is signed and in writing.
2
If you're able to pay $3600 a month, you're not "six weeks from being homeless.". You're six weeks from living in a less cozy, slightly less convenient, non-cottage.
81
Thank you for pointing that out. It is offensive that the author who can afford to pay 4000$ per month in rent would use the word homeless to describe the scenario she would face if the deal did not go through. She would at least be in a hotel but definitely not out on the streets.
7
Mr. Igoe I would appreciate a specific reference to any report that states that real estate agents "scored the lowest"....I am a Broker and without the reference can not know how that study was done, by who and it just fodder....Real Estate Agents work at the will of their sellers, buyers, landlords and tenants. This agent was most likely following the landlords directive and there is no evidence that the agent was behind not sending the lease if that landlord had wanted to lock in a tenant with an offer a lease would have been forthcoming immediately. The problem here is your agent should have have informed you that a lease is not binding until it is signed. This is not on the listing agent....but rather an owner maximizing his investment...Real Estate agents are blamed and accused for things that we have no control over - landlords are not bound by our ethics and we can only advise them and not force action from them.
2
Use email and text messaging to document promises.
A word of mouth promise is not worth the paper it's printed on.
A word of mouth promise is not worth the paper it's printed on.
3
Oh dear. We need to do a better job at the high school level teaching about contracts, buying things and basic math. As well as how to ask the right questions before you start working with someone.
3
For many other contracts the agreement would be valid orally. And in many states what the broker did would leave them liable for fraud.
1
Counting up the times I've moved since I left my parents home at 18 - I think it's once every 2 1/2 years - as either a home owner or renter. Of the homes I've purchased - the present house had a similar issue. It had been on the market for several months and was in deep disrepair. Over priced I made an offer to the owner that many would consider under market and perhaps an "insult" but I was clear on the fact that there were so many repairs (this was without a home inspection just by my eye) that the owner accepted. She just wanted to get rid of it. My agent made sure that the contract was signed immediately because she knew that there were people returning to look at the house. I was LUCKY because there were two agents FURIOUS that a contract was signed because their clients wanted to make a better offer - a bidding war. I learned my lesson with agreement - I would have been left on the street if my agent hadn't been aggressive.
11
It's true, as one of the people interviewed said, that all professions have ethical components; however, the reason it is so frustrating that realtors/real estate agents seem so ethically lacking is that their profession involves enormous sums of money and a big commitment. With your freedom, credit score, and hard won cash on the line an ethical error by a third party renting or selling a property takes on a whole new dimension of importance.
1
Sorry to hear this, though there is one more factor to consider. Your agent was also likely working for the seller and was under no obligation to inform you of the risk of not signing the contract.
There is a dearth of buyer's agents in the New York area. Lesson to buyers: Be sure you fully understand your agent/buyer relationship.
There is a dearth of buyer's agents in the New York area. Lesson to buyers: Be sure you fully understand your agent/buyer relationship.
7
The law favors and protects realtors and forces people to hand over billions in percentage based nonnegotiable commissions for no benefit to a buyer or seller. They have a very large lobbyist army at federal, state and local levels. Consumers nearly no alternatives but to use to active home ownership. Since this lawful stealing is allowed, the ethics code is just a veneer of legitimacy.
1
Never would have thought to put Realtors and Ethics in the same sentance
11
Although the blame is falling on the real estate agent, it is the owner of the property who was obligated to either agree to the rental in writing or not.
1
People need to be aware as part of life skills that when it comes to real estate, land and property, all transactions must be in writing. Otherwise the transaction does not exist.
Many business and other transactions can be done with a handshake or verbal agreement, though that is not always reliable. But real estate must be in writing.
Many business and other transactions can be done with a handshake or verbal agreement, though that is not always reliable. But real estate must be in writing.
7
My realtor ethics story: We moved to Maine eighteen years ago from Connecticut with our two-month-old baby. We were unaware of a widespread problem in Downeast Maine, that of arsenic in the groundwater. After six months in our new home, during which I was making baby formula with tap water, a neighbor told me I should have our water tested for this. Turns out we had an unusually high level of what is called "trivalent arsenic" in our well. So bad that we were later part of a CDC study to determine whether we were being affected by the arsenic, even after we switched to bottled water (the results were - disturbingly - inconclusive). The kind of filter system that would remove this type of arsenic is unaffordable for us. We never pursued legal action, as we were starting a new business, and along with our baby, life was very chaotic for a while, but I will never - ever - forgive our realtor, a grandmotherly retired teacher, or the seller. I become enraged whenver I think about this.
53
It might be that the owners, especially 18 years ago, didn't know about the arsenic. Who ever used to do water tests? And some owners might just have known about neighbors' testing and pooh-poohed it.
A house I was briefly interested in, in Midcoast Maine, had been inspected, found to need filtering, and was subsequently rejected by the buyers. When I came upon this house, the sellers were still contentedly drinking and showering in the water. They still are, half a dozen years later, not having sold the house.
A house I was briefly interested in, in Midcoast Maine, had been inspected, found to need filtering, and was subsequently rejected by the buyers. When I came upon this house, the sellers were still contentedly drinking and showering in the water. They still are, half a dozen years later, not having sold the house.
2
What about the inspector? Wouldn't that person also have been responsible for
alerting you?
alerting you?
2
AE - This is a good opportunity to remind people of the limits of a home inspection. It is a visual observation of the condition of the home. That's it. Something like testing water quality is not in an inspector's typical scope of services.
You were failed by your agent, much more than by the landlord's agent. Your agent should have insisted on getting the lease signed or otherwise informed you that the other party was, of course, shopping the property. There's NEVER a reason to put off signing a lease or sales contract if both parties agree on price and terms, unless one of them is seeking an alternative.
68
Completely 100% agree. Your agent had an obligation to deliver the message of the seller's agent (i.e. "the house is yours") and then caution you that nothing is final until you have a signed contract, so don't make any irrevocable decisions based on the assumption that the house is yours. It was a failing on the part of your agent to not inform you of the risk. If your agent had any experience at all in this industry, it sounds like they should have been very familiar with the trick of the seller's agent. It sounds like your agent was too focused on trying to deliver you only happy news.
5
No surprises here. I remember a study comparing professions on ethics, using a questionnaire, and real estate agents scored the lowest. This is somewhat different from public perception, where agents fare poorly, but are not considered the worst, beaten by lobbyists, politicians, and executives for sleaziness.
35
This happened to me. After being told I had the place, I waited and waited for the signed contract. Every time I called I heard, "it's yours, it's yours. Don't worry." The last straw was 9 days later when I saw there was going to be an open house. Should I start worrying?
Some states mandate strict time frames for responding to offers. While I think some of these time frames are too tight, they probably lessen opportunities for these types of shenanigans.
Some states mandate strict time frames for responding to offers. While I think some of these time frames are too tight, they probably lessen opportunities for these types of shenanigans.
68
Two more points regarding dealing with Realtors. #1-Your agent should have known to get the signed lease immediately, even if it means going to the other agent's office to pick it up right away. In order for the lease or sales agreement to e a legal, binding contract it is supposed to be "signed, sealed and delivered"
#2 - If you want to complain, you are best off doing it through the State Licensing agency that issues real estate licenses.
The best advice I was ever given regarding ethics is that your gut tells you when something is right or wrong. I always do a gut check. Make sure your agent does too.
#2 - If you want to complain, you are best off doing it through the State Licensing agency that issues real estate licenses.
The best advice I was ever given regarding ethics is that your gut tells you when something is right or wrong. I always do a gut check. Make sure your agent does too.
7
When I make an offer it has a time limit of 48 hours to accept the offer in writing, otherwise the offer expires and I will look elsewhere.