I am sure the number of AR members that have listed and sold their own real estate is high and yours truly did the same a long time ago but learned my lesson a few years back.
For whatever reason many of us want to save the sales side of the commission when we list our own properties. How is this any different from sellers using discount brokers to save part of the commission?
Back in the mid nineties a Broker/Owner of a real estate firm in our area was in the habit of buying and selling a lot of real estate and yes, he listed all of the homes he purchased himself acting as the listing agent. He also sold many of the listings himself as a dual agent.
On one occasion a buyer purchased one of this Broker's listings and used the same Broker to purchase it. After a couple of months the buyer's felt they overpaid for the property and also felt they were not given all of their options in terms of financing, home inspections, etc.
The sale of this property went to court and it would take pages to explain the judges ruling which went in favor of the buyers. One thing that happened is the judge referenced the Broker listing and selling his own property and said this placed him in a position of great liability. The judge stated that any Broker listing their own property placed them at a much greater risk. This Broker had the buyers sign every disclosure and every indemification agreement that meant nothing in court.
I also sell a fair amount of commercial real estate and it is very common for Brokers and Realtors that own commercial real estate in our area to list their real estate with a Broker of another firm. They don't feel the risk involved with listing their own property is worth it.
We would all be better off if we looked past saving a commission in favor of limiting our liability. It would only take one unhappy buyer with an aggressive attorney to destroy a lot of our hard work.
Comments(31)