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Unscrupulous Listing Practice?

Yesterday, while preparing a CMA (comparable market analysis) for a client's property, I came across something that got my blood boiling. What do you think?? Does the following constitute an unscrupulous listing practice?

In July 2008, I showed a house that had been on the market for 184 days. The house was only 4 years old, beautifully decorated and well-maintained. It showed very well but wasn't exactly what my client was looking for. That evening, I responded to an automatic showing feedback request explaining that the property was not right for my client and gave their reaction to the home. I always give feedback to the listing agent so he can discuss that with his seller. Since this property had already been on the market 184 days, I was sure the seller would want feedback.

Several days later, I got a call directly from the seller. I had left house for sale my business card on her countertop at the showing. She asked me if I could give her some feedback from my clients. I explained that I had sent feedback to her listing agent and that she should speak directly with him. She then said, "My listing agent never gives me any feedback. My house has been on the market almost 190 days and I don't know why it's not selling." I gladly explained why my client had passed on the property but then she started to ask questions about the current state of the market and my thoughts as to why her house hadn't sold.

I explained that as long as she was listed with another agent, she would need to speak with him. She said that she had never even met him. He had a large team and she only spoke with agents on his team. She never got the same agent twice. She always had to call them after showings because they never called her. I, once again, instructed her that she would have to speak directly to her listing agent. As long as she was under contract with someone else, I was unable to help her. I did say, however, that if she decided not to re-list with her agent, I would be happy to speak with her.

I decided to put her on my auto-notification list so I would be alerted when her listing expired. About 45 days later, the listing expired and I proceeded to contact her. She didn't even know that the listing had expired. She then advised me that she would call me back when she investigated further.

A little while later, she called and said that she had re-listed with the same agent. She explained that when she originally signed her listing agreement in February 2008, she also signed a document giving her listing agent permission to re-list her property automatically. They just hadn't gotten around to re-listing it in the MLS.

I couldn't believe what she was telling me. I had never heard of such a thing. Why would any seller agree to these terms? It doesn't benefit the seller at all. The only person who benefits from such an agreement is the listing agent. I was shocked.

As I watched expireds appear week after week, I would see this same agent's name again and again. All of his listings had been on the market for many, many days. I placed several calls to these expired listings. The response was always the same. They felt if any agent could sell their house, he could. Besides, they didn't want to get into a confrontation by calling the listing agent and cancelling their agreement.

I didn't understand what these people were thinking. It appeared to me that he was putting a sign in the yard and walking away. He didn't even have to call them again to re-list their home. He did it automatically.

As I was preparing this CMA, I noticed that the home I had shown in July 2008 had finally closed. The house was originally listed for $789,999 in February 2008. When it closed last week, it had been on the market a wopping 821 days. It had been re-listed with the same agent, 17 times with 9 price reductions. It sold for $500,000--63% of the original list price.

When this seller listed her home, the average days on the market was 87 days. However, what the CMA showed is that the property sold within 77 days of listing at 91% of asking price. This agent is manipulating the system to reflect lower days on the market and percentage of listing price. To make it look like he can sell your house under the current days on the market for above 90% of listing.

I can't believe that this woman remained loyal to an agent that failed to produce a buyer for over 2 years. The seller's ability to negotiate price and terms ceased to exist a long time ago.

Between 5/29/09 to 5/28/10, this agent closed 150 listings (remember he has a large team). These 150 listings had been on the market with this agent a total of 21,946 days and had re-listed with him 403 times. That means that each property was on the market an average of 146 days and had re-listed an average of 3 times. These numbers don't even include the expired and withdrawn listings that had smartened up and moved on to another agent.

The moral of this story...as a seller, you owe nothing to the listing agent. His job is to market your home and get it sold in a reasonable amount of time--821 days is not a reasonable amount of time. If you are unsure what a reasonable amount of time is, ask the listing agent for the average days on the market for your area.

Remember, in this case, the agent re-listed his client's homes several times. Why would he do this? Because then he could say that his average days on the market were lower than the actual number of days he had these properties listed. When interviewing agents, question them as to how many times they re-list their properties to reflect those numbers. And never, ever agree to sign a document giving your agent the authority to re-list your property automatically prior to the expiration date of your contract. Make that agent work for the listing or find an agent who will.

Is this an unscrupulous listing practice? You be the judge.

************************************************************************************

Tammie White, Realtor® in Franklin TN

Cell Phone: (615)495-0752

www.TammieWhite.com

Tammie@TammieWhite.com

This posting and the contents written here are the intellectual property and opinions of Tammie White of Benchmark Realty LLC. Providing real estate services to clients in Franklin, Brentwood, Nolensville, Thompsons Station, Spring Hill, Fairview, Leipers Fork, Nashville and the whole Middle TN area.

Posted by Tammie White Realtor® Franklin TN Homes For Sale on 05/29/2010 09:34 AM

Comments (201)

unscrupulous listing practices

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201 Comments on Unscrupulous Listing Practice?

MAY

2010

Hmmm...I know with my short sales I do put automatic extensions on the listing agreement but this is to allow for time to negotiate a short sale contract after the price reductions have produced an offer. I would never do this to my non-short Sellers. I do offer a cancellation agreement to all of my clients and feel confident they will not exercise this if I am doing as I should be.

WOW...I have never heard of such a practice! Yikes...I have a few career listings on some of my vacant land listings...but I do keep in touch with my clients...they understand that Land sales are almost non existent...and they luckily own them free and clear so they are good with that! It is crazy what some agents do...and to sell so many houses with that type of customer service!!! yikes!

Perhaps it is unscrupulous and it is certainly bad customer service. And yes, it does make a bad name for other agents. But I also see something else at work here. This often makes me unpopular on AR, but here goes.

Seller's have just as big a part in the responsibility for selling the home as the agent. There are many factors involved in selling a home, as you are of course aware, and I think that placing the blame entirely on the agent is a little presumptuous.

The idea that these people were "suckered" into re-listing & re-listing based on an agreement with a cancellation clause is ridiculous. We are talking about grown ups here who are supposed to be making decisions about their most valuable asset.

The fact that at no time in 821 days, in order to save herself $289,000, did this seller take any action IS A LITTLE ODD.

Oh my... why on earth would a consumer agree to such terms? It would never occur to me to even ask.

Denise - I do understand that you might list a short sale or foreclosure for longer than the average days of the market. This was not the case here.

Deborah - It is surprising what some agents do.

Jenna - I don't disagree with you here. This woman was an intelligent woman. Why she stayed listed for so long with this agent is beyond my understanding.

Margaret - My thoughts exactly. What's even more amazing is that these sellers go along with it.

Tammie,

Thanks for seeing my comment as it was intended, it's hard to know what kind of stuff people have in their heads. And all sellers are different, some will jump ship after being with an agent for 60 days and then others,,,well 821 days, is a long time!

Have a great weekend!

Excuse me while I pick my chin up off the floor. I have never heard of an automatic listing extension. And shame on the seller for signing that document. I wonder how many referrals that agent receives from past clients.

I do find this to be unscrupulous. You may consider taking this up with your real estate commission. This issue arose a few years back here in Maine and the commission altered its rules for that very reason. In our MLS, the history of the property is shown to all agents. In the case of re-listing, the days on market continue to count from the time of the first listing, unless it is listed with a new agent. In order to start the days on market counter over, there needs to be 30 consecutive days from the expiration of the first listing to the beginning of the re-list with the same agent. He simply would not be able to do that here. Also, I have NEVER heard of a seller agreeing to an automatic re-list here. That does seem nuts.

First of all in our neck of the woods you could never do the automatic relist list thing. Thank heavens, what a mess that is. Secondly, what are these consumers thinking. How can you stay with the sane realtor for years if you are not getting service and results. Just when we think the sustomers are getting smarter you see something like this. Unbelievable!! Thanks for sharing

I agree it's hard to know what the seller was thinking of there! But luckily our MLS would defeat that agent's attempt to show fast marketing time when it really wasn't - ours shows cumulative days on the market where the clock keeps ticking thru relists or extensions unless the house comes off the market for at least 90 days. Definitely a more accurate picture of market time! Now we just need the percent of sales price to list price to reflect original list price not the final list price after multiple reductions...

Yes, I think it is unscrupulous, but it hinges incredibly on unbelievable! People do the darndest things and far be it from us that we should understnd.

What boggles me is that some Realtors are so arrogant and self-absorbed that they automatically assume that a taint on their professional reputation means nothing. This person would probably charge a fee (outside of what the MLS charges) for withdrawing or cancelling a listing as well. This is despicable. Most sellers in this market are doing so because they have to. They trust us to do exactly as we promised from the moment that we sit down at their kitchen table - which is to SELL THEIR HOMES, sell it quickly, and for as much as possible. I would NEVER want to work with a Seller who has doubts about my abilities and/or motives. Luckily our MLS database would only show the cumulative days on market for the entire list period AND the original list price, list price at sale, and the actual sales price.

Does your local MLS board have any comment on this "practice"? Seems like they need to revise their CDMLS counter.

I like the Atlanta MLS system! Sounds like it provides the most accurate, relevant information. Tammie, as for the situation you describe, it really does need to be reported to the proper realtor oversight. Would love to hear how they handle it!

Hey Tammie. I know exactly who you are talking about. I figured out the same thing a few years ago. I had a seller contact me who finally got tired of the continuous extensions with no contact from "the agent" himself. They expired and I subsequently listed the house, put in new pictures, and sold it in about 60 days. I don't know why the sellers think they HAVE TO stay with him and his team. When you look at the daily expireds, at least 50% of those listings are his. These business practices definitely do not benefit the seller. But I think when the seller sees "150 listings sold" and/or Top Listing and Selling Team, they are brainwashed into believing this is the best way to go.

Hi Tammie - In a way this really underscores how little the general public knows about selling real estate. Many of these sellers probably listen to a very polished presentation, don't know what questions to ask, and then don't fully understand what they're signing. We need to keep educating them.

Tammie - that's quite a storry. I suspect there are agents like this in many markets, if you take the time to look. And some are pretty obvious.

Seems to me that there are two guilty parties here - the agent, certainly, for business practices that give us all a bad rap (and not much attention to fiduciary responsibilities), but the seller as well.

Jeff

We think John has a good point when he says that" this really underscores how little the general public knows about selling real estate..."

Sounds just nuts to me. Of course I can't say that I'd put so much time into researching another agent's success or lack there of on the MLS.

In response to the comments that the seller should be assuming responsibility for their biggest investment . . .if we as Realtors cannot guarantee professionalism and integrity in our ranks, then what is our perceived value to the general public? I think sometimes that those who have been in real estate for a long period or never purchased a home before they became an agent forget that the general public knows very little about real estate and what their role should be . . . unless a good agent educates them. They are counting on us to lead them through the process and are compensating us well for those services. I honestly feel that if our industry is unable or unwilling to weed out or expose the unscrupulous among us, we are only hurting ourselves.

When this woman's neighbor advertises his home FSBO for $550,000 and sells it in two weeks, what will the message to the public be?

My understanding, and I am no lawyer, is that in Florida your contract must end and cannot have a clause in it to automatically renew after it expires. The seller might want to check with the state she lives in and you can probably check with your state association's legal hotline. Sounds wrong to me.

Thanks for the post, It is one more thing to really take a good look at! I have seen alot of that with some listing and could never understand why! On, OFF, On, OFF, People always find away to manipulate the system to there advantage.

This is something I would bring up with the MLS board. Our local MLS does not recalibrate days on the market to zero once a listing expires. We count cumulative days on market. I think that helps prevent skewing the numbers.

Tammie, that is unbelievable.......not only is the practice deceptive and the seller naive but it completely undermines the MLS statistics for # of days on the market and percentages.

John #22 - Texas is the same way. Listings must have a specific ending date. The automatic extension routine seems to be an attempt to skirt the rule if it exists in that state.

Tom

This agent should be not only approached by the seller, but the ethics board as well!

Okay guys let's see if I can catch up. Ran out for an appointment and came back and found this:

Kathryn - This is my first experience seeing this practice.

Kristen, Steve, Lesley, Nancy, Leslie, John, Sandy, Tom and All Brokers - Thanks for the suggestion about contacting local MLS board. Maybe they can change the system to calculate the exact days on the market. That would prevent this agent and others from doing this. Then agents would be forced to disclose their numbers accurately.

Vanessa - Rumor has it that he does charge a cancellation fee for breaking the agreement. I didn't put it here because that hasn't been verified.

Rhonda - Not surprised you figured it out.

Tammy - This is not the first time I've seen this with this agent. I was so out-raged to see it again and decided action needed to be taken. Hence, my reason to investigate further.

Extremely unethical. Wow, I am surprised no one has ever turned him into that state Realtor board.

At the same time, each of his clients should have canceled the listing. Maybe lack of education is the problem, and they do not understand their rights.

Dave and Connective Realty - Unbelievable is an understatement. I was out-raged. That's why I took the time to research this agent.

John, Jeff, Carolina Mornings and Valerie B. - It does show how little the general public knows about real estate. Realtors like this do give us a bad name. It makes our job even more difficult when other agents do things like this.

I have no idea of an automatic renewal is legal in the state of Ohio, but a listing agreement MUST contain an expiration date. This just doesn't sound right to me even if it is legal. List them and leave them. I do think sellers have to assume a fair amount of oversight and know what they are signing, etc., after all, THEY are the one's hiring the listing broker. That said, any unscrupulous business practices should be hammered into the ground and the only way that will happen if the industry educates consumers and sellers become equal partners and do their own due diligence and know what they are getting and demand transparency and accountability.

Chris- Either, the seller in this case really didn't understand her options or she was nieve about the process.

Hi Tammie, While I don't agree with your premise "......as a seller, you owe nothing to the listing agent." I agree that these stats are amazing ! I would check into the legality of " auto-renewing " a listing agreement !

This haveis a strange post. I believe it is illegal in Indiana to have automatic renewals period. We can extend the listing of course, but it requires a client's signature to do it.

Tammie. In Florida this may be an illegal practice. It would depend I guess on how the agreement was written. Here's the law that covers listing agreements:

(r) Has failed in any written listing agreement to include a definite expiration date, description of the property, price and terms, fee or commission, and a proper signature of the principal(s); and has failed to give the principal(s) a legible, signed, true and correct copy of the listing agreement within 24 hours of obtaining the written listing agreement. The written listing agreement shall contain no provision requiring the person signing the listing to notify the broker of the intention to cancel the listing after such definite expiration date.

You seem to focus on the large team aspect, this is just bad business but in todays world of ethics if a seller or anybody CALLS you you can answer their questions.

My question would be why you were not able to speak with the seller while under contract? Is that a state law in TN? In Massachusetts as long as the seller initiates the contact you are fine to speak with them.

This is unbelievable to me and it confirms my theory that people are afraid of confrontation. This listing agent was obviously a charismatic individual. How else could he get someone to agree to those terms but wait, you said the lady was not aware that she had signed a contract that included a re-listing agreement. Again, I have to say that people are afraid of confrontation. This listing agent had a team of underlings that handled everything. Maybe the sellers just figured it was better to go with the flow than to put up a fight and go speak with an attorney about getting out of that arduous listing agreement. They are not the easiest agreements to understand and this is coming from a 16 year mortgage veteran. I am typing while I am thinking and the thought that came to my mind was, "Thank God for Judy Snyder" She is my personnel Realtor, and I would sign anything she put in front of me because I know she would do nothing to harm me. I know most of you out there are like Judy and that you would do anything to protect the best interest of your buyer or seller. This individual with the automatic re-listing agreements....can't you Realtor's in his market area tell him to fly right or suffer the consequences? Just a thought.

Seems odd, but you wrote something about the sellers not wanting to cancel the listing. Most listing agreements are not read fully by the seller. That's the problem. They need to read before they sign, and understand what they are signing. If they didn't like the agent, they should cancel. The most problems I encounter are the ones that are from the heavy hitters in the local area. They do things SO backasswards . . .

An automatic extension is a new one to me. Seems the seller should have read the agreement before she signed. Amazing.

Bill - After 821 days, IMO, the seller didn't owe this agent anything.

Evelyn - I am going to be checking into the legality of this on Monday.

BB - That's why agents get away with these types of practices. The law is written in such a way that the average Joe can't understand it. Shoot, I don't even understand it.

Andrew - The reason that I bring up the large team is that because that's a lot of closed listings. A seller might look at those stats and think this guy is a SUPER AGENT, even if he did border on unscrupulous practices. I want consumers to understand that single agents aren't producing these kinds of numbers.

Bill G. - At the time I showed this property, I was only in the business 9 months. I was working primarily with buyers. This particular agent was and is a heavy hitter. He has won several awards and I did not want to go up to bat against someone with so much clout. I've come a long way.

Steven - This agent is an award winning agent in this area. I think people are assuming that if he was doing something unethical or even illegal, he would have been caught by now. They trust him because of his reputation. Unfortunately, the public doesn't have access to the information that I have. And until now, it doesn't appear anyone is calling him on it.

Carla - Once again, he is a listing leader in the area and no one is questioning that.

Cameron - I always advise buyers and sellers to read their agreements, even though, I have already explained it to them. I'm not sure any of them really do.

Is it unscrupulous? Perhaps. But is the seller a dope for choosing this agency? Absolutely. Yet another example of people putting more into shopping for a microwave than for a good agent.

There's an agent in my marketplace that lists homes for short periods of time, expires them, then takes them back to the market at a lower price with a new MLS listing number. It's insane when you see the number of times this agent lists the same house at with different price points. While I don't doubt that this strategy could fool some buyers, thinking that the house had only been on the market a few days, the practice distorts the true marketing time of the property. While I've casually consulted with my broker and our board about this practice, I've never pursued to with a formal complaint to see if its an ethical practice or not. I don't doubt that the practice creates disinformation for the consumer, what I don't know is if the seller understands and or authorized this practice.

Stephen - Most experienced buyer's agents would catch that these homes had been on the market for excessive periods of time and adjust their offer accordingly. However, this practice suggests that this listing agent is selling his listings in less than the average days on the market. A seller would never think to question the number that he provides to them. They would have to go to another agent and ask for verification. When is the last time someone called you to verify information provided by another realtor? Me? Never.

J. Philip - It is unfortunate the things we see sellers do.

Yes it's unscrupulous but I agree that the sellers has some responsibility in all of this. It's not like she was selling a lamp for $49.99. She should have done a little more homework.

I have never heard of anything like this, I am "almost" speechless.

This agent is not representing his clients, he sounds lazy, unscrupulous and unethical.

Plus he is obviously training his "team" the same way.

Tuesday I am calling my MLS and asking what their take is, legal hotline might be interesting too!!

In Texas, the License Act requires a definite termination date in all Listing Agreements and Buyer Rep Agreements. No automatic renewals.

I don't see why the clients would stand for it... They get the first chunk of blame. The agent seems like a blight on the rest of us, but he has to be enabled by others. He can't do it by himself.

Tammie, I have never heard of the automatic renewal but everything is negotiable. Sounds like gullible sellers or sellers being taken advantage of.

You would think word of mouth would have taken this guy out a long time ago. To hear he is succeeding still is very disappointing.

Anything is possible including automatic renewals if it is written into the listing contract. I've even heard of automtic price reductions being wriiten in. However, the Seller should have taken more of a stance in this. There is more to the story than she was willing to share.

Tammie -

I for one appreciate the time you took to investigate and write this post. It has "teaching moment" all over it and sounds like an instance where the agents "reputation" is letting him get by with murder - too bad someone hadn't looked behind the reputation before this.

Well, add me to the list who feels this is unscrupulous, even if it may not actually be illegal. I would certainly look into this with your MLS, and you probably don't even have to name names unless and until you are sure you are on firm grounds.

Yes, I agree that a seller with two brain cells to rub together "ought" to know better that to keep relisting with a non-producer like this agent, but as several other people have remarked, many sellers have no clue about real estate practices in general and specific stuff germane to this incredibly difficult market. We all know how hard it usually is to get more than a token price reduction...most sellers think their house is the best one on the block and will listen to any reason for it not selling...so long as it doesn't involve price!

So I would say that while the seller should have known better, it's also understandable that she did not. And if this guy gives off a great line and makes himself and his team look like the best in the business, she might very well have relied on his "expertise" to her own detriment.

I've never heard of automatic listing agreement extensions. Last year I took over a listing that had been on the market for almost a year. The owner had called me the first time the listing had expired but felt she "owed" it to the agent to give them another chance. Six months later they called me. I worked with them on staging and a price adjustment and they were under contract in 10 days. GO figure.

WOW - -- I would love to make a witty statement but I am in shock at these numbers and what they really mean about this company.

Tammie, I cannot believe this! I am going to have to re-blog this one.

Anna

Tammie,

Well....I have to say this one blows my mind....why would anyone want to re-list with someone who fails to provide appropriate real estate services?

Amazing and absurd. Okay, is this in the listing agreement itself? Is this an addendum?

I'm trying to figure what this guys says to the client. I can only imagine that it must sound like this, "ahh Mr and Mrs Smith just sign right here above your printed names on the last page of the listing agreement. Then could you sign here as well indicating that this nonsense goes on forever. Okay great see you in 821 days."

An automatic contract extension? Is that legal in Tennessee? I'll bet it is illegal in many states even though the definition of a contract is voluntary, so anyone who signs an extension has to do so voluntarily...and knowingly! Nevertheless, most boards require a Listing Agreement to have a term. If there is an automatic extension, I would argue the term is never-ending. Does his contract say, The Never-Ending Listing Agreement?

I would be intrigued to have some lawyers weigh in on this. I am NOT a lawyer. I can't imagine going before a board, a judge, a mediator or even an arbitrator and justifying an Automatic Contract Extension unless there were some obvious mitigating circumstances.

Tammie this is new to me too. Looks like this agent has a scheme going and it is wrong on all counts.

This story makes me VERY sad. People's lives and futures are hanging in the balance and their biggest asset is being mishandled by "A LARGE TEAM". When you look at some of the production numbers of large teams its a LARGE JOKE! Ad reads.... "John Doe sold 48 million last year". When you look at the John Doe team it consists of 12 people. 48 divided by 12 = 4. Average 4 million each. NOT a real big deal. Meanwhile John Doe himself is out on the golf course relaxing on the links while the $12/hour clericals are doing the grunt work on the listings.HOW MANY SELLERS ARE AWARE OF THIS "BUSINESS PRACTICE"?? GRRRRRRR!!!! TLW WHere Is Your ROAR!?!?!?

Tammie, I come away from this story with a different moral, that moral is that people that make bad decisions will likely continue to do so for the foreseable future. If hiring a good agent is a good decisions, they may be incapable of doing so as thye are always falling for a ploy, shtick, line, etc.

This sounds like one of the "game plans" for success from one of the industries "big" speakers. Just get it listed and then only talk to the client when you need a price reduction or when you have a contract to present. The perma extension is a new one.

I think this is really bad business. I was very bothered when I was handed a handout from one of his followers who employes this methodology. I have (prior to 2009) listed homes that had been listed before with another agent, then found myself having to thoroughly explain all parts of the listing agreement that they had obviously never heard; and if it was previously explained at all, it was not done in a way that the seller understood what they were signing.

I never heard of this in Ca. I am guessing it is not legal or someone would have done it. There are bad apples everywhere.

Marcy

MAY

2010

I believe this practice may be illegal in Idaho, as well. However, I have heard of this being standard practice for commercial brokers. ??

To give this agent and his team the benefit of the doubt, it's fair to say, we are only hearing one side of the story. Tammie, did you ever try to contact the agent directly to discuss this?

Unscrupulous? Yes. Unethical? Yes. I've never heard of an automatic contract extension. It may be illegal in Arizona, but I'm not touching that one.

I have not heard of automatic extentions either.

I have to put a lot of blame on the sellers though. They are not too smart either to allow this and then to relist. Learn something new everyday.

I understand Tammie. I know when you 1st start in Real Estate everything can be intimidating!

Wow Tammie you have hit a nerve with people!! It's amazing how sellers don't own up to the responsibility of what they sign...didn't they get a copy of the listing agreement & read it thoroughly??

No automatic listings allowed through the RI MLS system & it really is a travesty to have that done to the consumer...I ask WHERE IS THE STATE's DEPARTMENT OF BUSINESS REGULATION on this one- certainly not protecting the consumer!

I always give my unconditional guarantee to a client..if they are not happy with me they can fire me & i'll give the listing back (never has happened). This listing agent & team have the sellers buffaloed!

Here in Pennsylvania, you are not allowed to take any listing longer than 12 months and you cannot put in auto relist clauses.

That is illegal in our state.

It is a shame but this seller should have contacted that agent's broker and demanded to be released from the contract if she was so unhappy.

PS--I just read through everyone's responses and love Phil's comment in 43.

The seller ULTIMATELY is in control, and needs to complain. If the seller does nothing, that is it. Oh well. Another bad agent allowed to dirty our reputation as a group.

The onus is on the seller to either complain to the broker or the board, and end that listing. Or call an attorney. Or do something. Just allowing the auto re-list and rolling over accomplishes zilch and you can do nothing about it.

Automatic what?!? Thats crazy! There is a reason those agreement have an end date. Why I am not even sure that an "automatic" renewal clause is really legal in most states.

I couldn't wait to scroll down and find out where you're from as I thought for sure it was an agent here in AZ. My question is this? You stated you would've handled it differently now. What would you have done differently? And, why didn't you bring this up to your broker at the time it happened? Perhaps he/she would have told you it's okay to talk to the sellers when they contact you?

I don't know where they find these types of sellers.

My experience has been that after 2 weeks and the house hasn't sold, then you had better start worrying about the seller pulling the listing.

Tammie.....

I am not sure of the ETHICS aspect of it. The agent is a zealous opportunist...no doubt about that. However, I couldn't help but have thoughts of the elderly and how people prey on them for various reasons. It is not because they are stupid, it is because they are vulnerable and lack the desire or "want to" pezzazz of the earlier days. They just go along, but don't like it. In your post, I see a one-sided scenario and complacency about it. But, I dont have enough facts. All I can say is it takes all types and in the world of Real Estate and you will meet them......I had a women complain to me about her agent one time. She lived in a retirement community. I left her with "talk with your agent, because I cannot help you" but then threw in, and check with a family member as well.

Best

Hi there,

Often we find what we consider to be unscrupulous practices in our profession to be perfectly legal though maybe just a little on the line. If you think a practice is on the line move away remember our jobs as Realtors is to protect the public and doing things right will always come back to you. In addition, I do believe in the State of Florida this type of agreement is unenforceable so you way want to check with your state just so that next time you know for sure.

Great Read - Thanks,

I reblogged your thoughtful post, Tammie. I don't think it's ethical to have sellers sign an automatic extension of the listing.

Cheers,

Robin

I am from your area and know exactly who the agent is. I have often thought the same thing. Very misleading and manipulative if you ask me. I always treat the agent and his team with a healthy dose of skepticism and do everything I can to protect my clients from him AND his $500 admin fee.

I totally agree with Jenna Dixon. And, was this seller someone that insisted on pricing the home at HER price and not the agent's recommendation? Anyone that closes 150 transactions in this market is to be commended and not critisized. Im certainly not saying he/she is perfect but Im saying that I would have to hear both sides of the story as only hearing one side makes this "producer" seem guilty of something when that isnt a fair perspective at this point (in my opinion). After all, how many of us have had listings for a VERY long time in this market with no success? I appreciate your sharing the story, though.

Tammie,

It has been over three months since I clicked a link on active rain and to find your blog right away was very cool. I am impressed that the Tuesaday Tech class has gotten you this far! Excellent work and I am proud to be in business with an agent like YOU! I am sadend to read about the broker that you are writing about but then again he has been able to dupe the market with his "big" team!

Makes me mad that this technique is even allowed in real estate. No one should have an auto renew on a contract like this. It is BAD for business and for ethical agents like US!

Many blessings Tammie,

Cheers,

Ross Rylance
Keller Williams Realty Franklin TN

That practice is illegal in Kentucky and may also be in Tennessee. Check it out.

201 KAR 11:100. Exclusive listing contract; continuation RELATES TO: KRS 324.160 Section 1. No real estate broker shall be a party to an exclusive listing contract which shall contain an automatic continuation of the period of such listing beyond the fixed termination date set forth therein.

As to why sellers would list with this agent, I can understand their motivation. If this guy is a top producer with his name in the local real estate magazine and his signs plastered all over town, sellers think that their homes would be more likely to sell. They don't realize he is spending his time and money burnishing his image, not doing what it takes to help them sell.

Churn and burn. Many heavy hitters fall into this category. In our MLS if the client has expressed disatisfaction with their listing agent then they're open game for being a lead.

Very wrong and unethical in my mind. Perhaps not a violation, but perhaps worth making your ethics committee aware of them so that they can keep a closer eye on this agents practice.

As I was reading along, I thought I knew for sure who it was you were talking about until I saw you were not from my state! I hate to admit it, but we have a clone in this state. Everyone talks about them and their tactics, but nothing is ever done. It is a shame that the public does not have a clue as to what constitutes a good agent, what they should expect and what their rights are. We do require cancellation clauses in our contracts. People need to understand it is not always the glamour that gets their house sold. It is plain old hard work and a commitment to people. I have seen the same scenario repeated over and over here and have experienced the same wonder. I now know that P.T. Barnum did not say it, but nevertheless it is still true: there's a sucker born every day!

As John Elwell stated above, this is illegal in Florida.

And it is totally unscrupulous, in my opinion, for a realtor to use the stats only from the time of ReLising rather than the Total amount of days he/she has had the listing.

I've also noticed that just before a listing agent marks the property pending, a price reduction will occur in the MLS that reflects that pending price in order to affect the list/sell price ratio.

I am surprised that this seller and other sellers agreed to this practice. Is a bit unorthodox. Most sellers in our market would have just called in and terminated !

Just a guess but it may have been the " market share " card was played. it is done around here a lot..sad but the numbers are not a sign of lengendary service...that for sure......In my state if re-listed a new contrract needs to be signed.....

In the Triangle MLS in NC, we now have 2 sections for Days on Market- on just DOM, the other CDOM, meaning cumulative Days on Market. This prevents those agents from skewing the numbers to make their own record look good.

Interesting comments. Sellers have to do their own due deligience and make their own decsions. The automatice extension is very weird, but maybe it keeps him in business. It's definitely not fair to us regular little agents who don't have the big bucks to advertise and get our name out there, but maybe it's an idea worth considering for your next transaction. Do they even have a form for that?

What does your broker say about it?

Well, I have searched the TREC laws (Title.62 Ch.16) and it does not state the Automatic continuation is illegal. So, whatever the Seller and Broker agree to seems fair. However, seems like just plain old Bad Service to me. Now, manipulating the MLS data, that is an issue for your local board. Good luck!

Sounds like this agent is doing it for less than standard commission, that would be why the sellers continue to keep their listing active with him.

I alway discuss and request an extension to the listing period if the house does not sell. I do try to get a 6 month listing agreement upfront and have never had a problem with it. I tell all my sellers that they cannot terminate the agreement at any time if they are not satisfied with my service. That goes for my buyers too. I think that is only fair. I treat my clients as I would want to be treated. Some agents are just too greedy!

Thanks for the great post! It never occurred to me that agents would ask a seller to sign a document giving their permission to automatically renew a listing agreement. My company would never allow this. We have a change of status form that must be completed and signed by the client at the end of the listing period to extend the listing. This agent and his company both need to be investigated!

Insane. All I can say about that is that many sellers cannot be educated. There is a cattle-like mentality out there and I see it daily.

I agree that this situation is beyond shocking. However, as many others have commented, I am most shocked with the consumer's lack of aggression to obtain adequate representation to sell the house and allowed a commission receiving agent to avoid communication with the consumer for half a year! To that consumer, "We often get what we deserve..."

Nevertheless, it is obvious that the agent is out of line. But, any contract/agreement can be broken if the consumer has cause. Which in this case, the consumer wouldn't have had to exude much effort to prove cause merely based on lack of customer serive/communication.

If your board does nothing about it, you might want to consider applying the same MLS tactics.... ;-)

I think you may have given some readers a new idea! But it clearly works for that Realtor or she wouldn't be doing it.

I put automatic extensions in all my agency agreements as standard practice. One never knows how long it will take for a client to decide on the right home or for the home to sell. Save a tree with a standard extension built in that the client can opt out of with written notice if they choose. Gives the client flexibility and cuts down on repeat and un-necessary paperwork.

Of course here the listing date does not reset so it does not skew the dom data.

I HATE agents that think they are too good to talk to their clients that they are suppose to work for! Why would anyone list their home with someone they never met or can't even talk to? I make sure ALL my clients are in constant contact. Sellers deserve to know what's being done to arket their home. This can be done easily with ones that have email because a lot of the sites their home is on will let me send them weekly reports showing how much interest the internet empowered consumer has in their price range.

I always show them the average days on market in my CMA. All the data we provide them is our professional opinion, but we ake it clear WE WORK FOR YOU. It all about setting expectations from the start. They understand we are people with lives just like them. They have multiple ways to contact us and know that if we can't take their call, we will return their call in a reasonable amount of time (usually within the hour, hopefully sooner)

Our MLS here keeps a history of the listing, so if it expires then the sae agent relists it a week later, the days on arket will usually pick up from where it left off. I always run a history for my buyers and sellers too. I agree that is an issue that should be brought to your board!

Never heard of such a thing and it IS unscrupulous. What the heck? Even magazine subscriptions give you an opt out for re-committing to more issues. Good grief. Short Sales sometimes need to be extended, but I extend them the same way I do regular listings..by being in contact with the Sellers and discussing movement, comps, etc.

That Agent is just lazy and also very lucky that he can buffalo so many Sellers. On the other hand, what's wrong with the Sellers? Too lazy? Don't read? Don't care? Don't really want to sell?

Sheesh!!!!

Kimberley Kelly, SFR

Very questionable practice. I am glad that those types of extensions are prohibited in our state.............chris

This is very interesting because their are some VERY high end homes in one particular area where it aseems that this "one" agent owns all the listings and a majority have been listed now for almost 2 years EACH - I wonder if it is the same situation - except that these are not uodating as "newly listed" with shorter DOMs.

Automatically ...yicks....you have to wonder not only about the agent but it must be fine print for that many sellers not to catch on to his tactic...guess if it were me...I would give the board/mls a call....you know with that kind of volume it is likely that the broker will only defend his actions.

I know an agent whose track record states that she sells at 99% of list price. What she does is lower the price at the time of an accepted offer. There are many ways to be unethical in this business. I just wish that some of the unscrupulous agents were not so successful. I would like clients to be more concerned about these practices and choose agents with higher standards.

Sad to see this type of behavior to go on in the profession I recently chose. I see how some many consumers are convinced by these fast and slick talking realtors that they are the only team in town and if they want to sell their home they must go with them. Consumers are lemricks at heart. So sad to see agents take advange of them.

It's exactly this kind of behavior that give our profession a bad name. grrrrrrr........

In Florida, this practice is illegal. A listing must have a definite expiration date and cannot have an automatic re-listing clause in it. It is probably against the NAR Code of Ethics as well.

Kentucky law prohibits an automatic renewal clause in our listing agreement.

I would have guessed that TN law closely resembled our Kentucky statutes.

Amazing....I can't believe that this is allowed. The sellers are being held hostage by a listing agent, that can't be legal. Of course....they are responsible for reading what they sign. I'm sure there must be a 30-day out clause, or something....odd.

Tammie,

We have a couple of "Realtors" here like that. They pull the same stunt.

I don't even know where to start. I'm amazed how many people want to blame the seller. The seller is the PUBLIC, and we are supposed to be the educated professionals. I'm like a broken record with "educate, educate, educate" but some people need more protection than others. Don't we have a duty to them? If the seller isn't reasonable - whether for mental, physical or even emotional reasons- shake hands and walk away. To put blame on the seller is beyond my comprehension. I had to check the origination of this post because I could think of a few names around here with similar practices. I've seen the "threats" to sellers because I followed and did the next listing and sold the houses. People are intimidated by legal docs, so they do what they are told unfortunatly. Why aren't we as professionals banding together to take the time necessary to turn these people in? Oh, yeah, because we might have to work with them, might spend some time helping other "real professionals" succeed" and "don't want a reputation for complaining". I've watched this business go from superior to questionable. This reply could take a book,but the bottom line is: MLS services need to take action against this kind of thing ( ours does) and agents need to get their pride of work ethic and morality back. I've loved this business and the people in it many years now, but a recent experience would have driven me out thanks to an unco-operative "co-op" who only emerged the last two days before closing and that with threats and accusations. Where are the rest of you who care?

Hi Tammie - thank you for sharing your experience and to all that responded. It's a learning experience. I do run into those types of agents. Unfortunately, the seller also bears responsibility for making the wrong decisions. In my listing meetings, I always try to educate consumers about certain practices in the industry, but in the end, it's their decision.

Tammie it's a common practice around here for agents to relist a property without the sellers knowledge. Some may have pre-authorized it, but agents know that a seller will never remember and they also know that they won't often check the agreement. Our Association constantly reminds agents that the seller's signature is required on all changes including price, extension, back on market, cancelled, withdrawn, etc, but it rarely happens and it drives me crazy. I feel like it holds the seller hostage and why would anyone want to do that.

I did somewhat of a mini-series on this subject on April 9^th and 10^th so I totally get where you're coming from.

I won't supply a link away from your blog, but The Mini-Series is as follows in case you want to read.

"The Agent Who Didn't Sell My House is Only Charging 6% Commission"
"The Agent Who Didn't Sell My House: Part II"
"Should Agent Loyalty Take Precedence Over the Goal to Get Your Home Sold?"

Tammie -

Thanks for taking the time to share your story. I'm shocked and saddened - these are the kind of actions that lower everyone's trust in REALTORS and damages our professions repuation. We have lots of agents do that here at least now there's more being built into the MLS "history" to show true days on market - but just last night I was booking a showing for a "new listing" and when I looked it's one I've shown over 6 months ago. Guess in the world of "transparency" we've still got a LONG way to go :)

You aren't allowed to do this in Florida - when the listing is expiring you have to get an extension signed if they want to keep it listed with you or if it expires you have to have a new listing agreement signed.

Our MLS accounts for relists and reports the data. Doesn't necessary stop the relist game.

Sellers don't normally have a clue how the listing progress works. They just want their home sold.

It hurts our profession when agents play the relist game.

I know I am just a stager, but as a stager I have been a fly on the wall for over 6 years now and I work with over 250 agents. I hear and see a lot of things- shocking things. I just smile, keep my mouth shut, and do my job. My poor husband hears a lot though.

I think all Realtors should know the real estate laws of their state. In California listings must be extended in writing or a new listing must be signed. This is why there is an expiration date. Your MLSs should also have rules regarding listing contracts. In California if Realtors have any legal questions we have attorneys that work for the Calfornia Associaton of Realtors in which we are able to call and get free advice or information. Our Realtor dues include this service. I have been a director for CAR, since 1992, so I am able to keep up with legal, contractual and other information to best serve my clients. I also sit on my local MLS Council so I know the rules and regulations and help solve issues that may come up with our members. This sort of practice would be a violation of our MLS. Our MLS has a correction buttoin on each listing. If one of our member clicked on this button and stated that this listing might not be legal, our MLS would call the agent for proof and if in violation would be fined and the listing would be removed from our MLS.

I am reminded of the Telephone Scams that leave some folks penniless .... Should they have sent that check ? Of course not .... but we are not all cut of the same cloth ( genetics, intelligence, emotional need etc.) I waited 6 months before enrolling in REAL ESTATE school for exactly the reason conveyed in this post... I had read all the surveys regarding the perception of REALTORS in the public eye and was dismayed at the results. But after a period of reflection, my position was that if those of us who practice ethically - professionally and compassionately shun the industry how would those perceptions change?

I am not only appalled at reading this post - I am saddened.... How does one sleep at night? You are impacting people's lives - money - emotional well being... You can argue the legalities - the fact that the seller should have read the listing agreement etc. - but at the end of the day this REALTOR - "Doesn't Care About the Homeowner" ....

We all need to reflect on this scenario and ask ourselves " What can I do to ensure this type of practice is not permitted?" I have to say that I am guilty of sitting back and letting others work on policy - work to improve our MLS - work to improve our Forms - our education etc... This was a good wake up call for me ... I am getting involved ....

Tammie,

That is a great example of worst practices.

If I'm not mistaken the MLS in our area has recently implemented a property listing history to track the total days on market when this type of behavior occurs. This was specifically to combat the practice of data manipulation with regard to CMA data.

I am not a lawyer but I think that the automatic listing renewal is prohibited either under ther REALTOR code of ethics or under contract law, or both.

Wow after many, many years in this business this takes the cake!!! I really do not understand why the seller would allow this to take place over and over. However, I do know and understand that the general public expects us to be honest and not to take unfair advantage of them. This is a first class example of someone being taken advantage of. I would like to have been a "fly on the wall" when this listing took place. I imagined all kinds of promises (broken) were made to get this listing. He did not just buy the listing he STOLE it!!! He forgot "do unto others and you would have them do unto you." He probably didn't even know this was part of what a good REALTOR stands for. Thanks for sending this story to us so that we can always go beyond the call of duty and make a difference in our profession and give to our customers and clients the level of service that we are expected to give.

In Florida, it is against the law for a listing agreement to include and automatic renewal. Should be that way nationwide.

It proves that there is still a lot of "cleaning up" we have to do in this industry. Part of the problem though is laid on the seller's. Most times they will complain, but are not willing to file a formal complaint with the regulating department of your state.

Bottom line: sometimes we can't help them until they help themselves.

Our MLS system started putting cummulative days on the market in our system last year to make sure the consumer was well aware of all the accurate data. I would contact your commissioner of Real Estate in your area and the president of your mls and inform them that other MLS systems have revised their standards to protect consumers and suggest they adopt it as well....good luck...it would put teams like this out of business or at the very least, force them into better business practices.

I think the listing agent automatically cancels and relists at the 90 or 120 day mark. There are many agents in my area that do the same policy. Our MLS USED TO have a policy against this and then they handily changed their minds on it. It does nothing for the correct days on market. I would have to wonder if the auto cancel & relist is actually legal that you explained here. I'm going to ask my broker on this.

I do think that if you have a large enough price reduction it might be a good idea to cancel & relist so you come on the market fresh.

Absolutely it is! Thank you for posting. This is mind blowing, and makes me continue to wonder, why to sellers hire agents like this? This seller was clearly unhapy with their service, but kept listing over and over. And for the agent to manipulate the numbers like that is fraud. I'd report them to your local association.

Commenters - Thank you for taking the time to respond to this post. I had no idea that this subject would strike such a nerve. But I am happy to see that it did and that most here are outraged by this behavior. It is exactly people like you that keep me in the business. I had hoped to respond to each comment but I can now see that might be difficult so consider this an addendum to my post.

When I first came across this practice in 2008, I was very new to the area and business. I had only had my license for 9 months and was working primarily with buyers. I was not pursuing listings and while I was outraged by this behavior did not feel that I had the wherewithal to come up against this agent. He is very well-known and, dare I say, respected here. I believe, that he continues to get business because consumers assume that if he were doing something illegal or unethical he would have been caught a long time ago. He is an award winning agent in the area. I can't imagine that any consumer would question his integrity.

Think about it, if you sat down at a listing presentation and the agent told you he sold 150 homes last year and that he had been in the business many years with various awards to show for it, would you question his ability to sell your house? I think not. I was so angry because consumers are trusting our real estate board and MLS to monitor this type of behavior. I guess, they're not doing that. And until now, I had never even thought about that type of oversight.

Due to the overwhelming response to this post, I am going to be contacting my local board and MLS. There must be something that can be done to prevent consumers from this type of deceit. Clearly, this agent is manipulating the MLS by re-listing properties every 45-50 days. By doing this, he has manipulated the system to reflect that his listings sell on average within 66 days on the market at 96% of listing price. My research revealed that his real average days on the market are 146 days, more than 2 times the amount reported by our MLS. Unfortunately, I didn't do the real percentage of list price research. I think consumers would be shocked to find the actual percentage of list price that he is selling for. Let me say, that I am sure that he is not the only agent in my area that is probably manipulating the system in this way. So something needs to be done.

As for the sellers, while I do think they have some culpability here, many are just unsuspecting victims. As I said previously, they rely on our boards and MLS to provide oversight and prevent this type of deception. Most would probably never even think to question this man's integrity. He is endorsed by a top-notch financial guru of the area. I'm sure this financial guru is unaware of this agent's listing practices.

It would be reprehensible if I did not do something to prevent this from happening again to an unsuspecting seller.

Thank you for your kind words and support. I'll keep you posted.

Tammie

I've never heard of this in California! We do however have teams of agents who handle REO Properties who make it impossible to actually speak with a person on the phone. We've waited for weeks for responses to offers, emailed, and faxed to find out whether our offer was accepted only to find out by looking in the MLS to find the property pending. If banks only knew....

Great information. There are a number of agents out there that do things we don't agree with and that border on the line of good ethics. It is sad as they do effect our whole industry. Some people also are agents for now.. and not for the future. Hopefully that teams clients will realize in the future that there is a better way...

Now, time to make your calls for the day.... Go get your listings and then treat them right!

Great research. I don't agree that the seller owes the listing agent nothing. After all, the listing contract is a contract where both parties agree to do certain things. However, I cannot understand a seller accepting such poor service and still hanging in there for 2+ years! I know the types of agents you are talking about in this article. They are the Craig Proctor disciples with large teams, sales gimmicks (such as "If I Can't Sell Your Home In 90 Days I will Buy It For Cash", "Buy My Listing and I Will Buy Your Home", "Buy Through Me and Get $10,000", etc.) and overall deceptive sales practices such as the phony Days On Market you provided. Over the years I have had several of my listings purchased by buyers represented by these "Proctor Agents" and I can honestly say that every transaction was sloppy with my small team having to chase their large teams down for required documents, etc. I just do not understand why home buyers and sellers fall for such nonsense.

Hi Tammy,

We all need to vent sometimes. I don't see any wrong doing in all of this. I don't believe the sellers. The listing agent or his assistants must have called the sellers many times, they had many price reductions or that was automatic too. Also for a seller to be loyal, that tells me right there, they are not telling the whole story, nobody is that stupid. I actually admire the creativity of the listing agent. If the sellers are stubborned about the price and the agent is telling them that their house will not sell at what they think it would, I think that having them agree to an automatic listing renewal is genius.

Tammie, I would probably be harder on the sellers if I didn't see things very similar to this happen so often. Some sellers just don't know much about real estate. Sometimes the sellers just don't know what is common knowledge to many agents and more savvy sellers. And there are agents out there who will take advantage of that.

Geez, I think it's awful when the seller isn't agreeing with the listing agent and isn't let out of the listing, let alone this practice. I always tell my clients that if they aren't happy, then I'm not happy!

Tammie,

I do believe it is unscrupulous.

This "machine" approach to the sale of residential properties really sucks the entire personal service flavor out of being a real estate sales agent and is part of the reason why some of us agents who pride ourselves on being personable and providing personal service get a bad rep.

The only thing I can think of here is that the seller has the ability to cancel the listing at any time. It sounds like either she was not aware of that, or just chose not to excercise that right.

Ralph Gorgoglione

Los Angeles Real Estate

I am not sure about TN, but I doubt if this is ethical practice in California. For this main reason, I will not list more than four homes at any one time, since my sincere interest is helping my sellers with the sell of their homes. I see alot of agents who have thirty/forty listings and maybe with an assistant you can handle more homes, but in order to earn your commission you need to concentrate on the sellers not gathering listings.

I know you can't influence the seller's to change their minds, but I am sure you could suggest for them to call your local Real Estate Board and put in a formal complaint. The seller is responsible to get their own home sold and should be just as pro active in the process, monitoring times the home is shown and always request feed back from the agent when a new card appears on the counter. There is so much information for the seller to become self educated.

The town you work in must be very large in order for this agent to get away with his continued practices of listing homes with no following up......... and the automatic renewal that is up to the seller and the seller should have a choice.

Bottom line, the seller hires the listing agent and or firm to sell the house, if the agent is not performing the agent can be fired! There should be an applicable relationship between the agent and the seller if not, then one of them should cancel contact. I always tell my clients if they are not happy with me or my methods of selling their homes they can cancel the contract, again it is a relationship.

Amal - While I disagree with your comment, I think it's important that others see a different perspective.

As to the truthfulness of this seller, I can't respond to that. I can only tell you what I was told. Nor can I respond to your suggestion that they must have insisted that the property be priced for more than market value. That is not a discussion that I ever had with the sellers or the agent. Therefore, I can't address the issue.

Obviously, some correspondence transpired or there would not have been price reductions. Once again, I don't know this for a fact but am assuming that a seller would not agree to price reductions without their prior knowledge.

As to why this woman, stayed listed for so long I don't know. I think she felt that he was a top agent in the area and if anyone could get her home sold he could. Did he get it sold? Yes. Did he do this seller an injustice for listing it for 821 days? Yes.

If the seller was, in fact, making unreasonable demands about price, I would have cut them loose long ago. I take listings to sell them. If I am working with a seller that is working against me to get their home sold, I let them go. This agent did his client a disservice by holding the listing for so long. It undermined the seller's ability to negotiate the sale of their home. That was the agent's responsibility to know what is right for his client and to overlook his needs.

Thank you for sharing your thoughts.

Thank you for sharing. I am pretty new agent and it is so good to read how some agents are so I can be prepared.

Best of luck!

I didn't read all the comments, since there are so many, but I'll comment on your statements to that seller. If they are calling you, directly, and they're asking for your help, then that's the perfect opportunity to secure a future listing. That seller is more than free to share with you anything he/she wants to share. And, if that information sharing happened to include their current listing documentation, then I say go for it. Yeah, it could create some riff with the current listing agent, but if you're thoroughly documenting your actions along the way, then they've got nothing on ya. Again, the seller is calling YOU, not the other way around.

Regarding the auto-renewal, that's specifically forbidden here in FL.

I have never heard of the practice of auto relisting. I guess what is really concerning me is passing the blame along to the seller. I think it is our duty to pass along to the board the bad practice, no names, but simply a FYI to what is going on under their noses. It wouldn't be long here in Nova Scotia before an agent would report you. It is never the client's fault.

Absolutely crazy that seller stuck with listing agent as she knew he was doing his job.

This seems unbelievable, but you just keep hearing more and more strange stories of what some consumers do and we all know the multi million dollar producer that seems to do nothing and some how just keep getting referrals. Our MLS also keeps counting the days on market so hopefully this will wake consumers up to the actual days these unscrupulous agents re-list and lower their average days on market. When they are caught advertising lower dom would that not be an ethics violation?

Not being a Realtor I can't speek to the legality of such an approach to business but it does sound slimy.

This person must have had some kinda line to get people to relist with him! It's a shame because a decent Realtor could have really helped these people.

I couldn't finish your blog because I threw up all over myself.

Here in CA, an ending date on a listing is required. The client (the property owner here in CA, a prospective buyer is called a customer) must be given an easily-understood copy of anything they sign. The Department of Real Estate has a special chair in their office for agents who have little scruples and bypass the safeguards for their own benefit. I would venture to say that is true in all states. Maybe your Boaed or Association needs to file a complaint on behalf of members of the public they are pledged to serve per the REALTOR's Code.

Wow!

This is a Good time to have Your Lender call her ask if she has any questions about getting a loan and then if the subject comes up (which it will)- explain to her, if she is not happy with the listing agent- how to get out of her listing agreement.

You can't call her, but your Lender can!

This only works if you already know she is not happy; feels trapped and doesn't know what to do.

This is why it is important to have a Great relationship with your lender. You can work as a team!

Jeff D is right that the seller has some responsibility in this situation. Unless unlawful undue influence resulted in the signed listing agreement, I would say that owner/sellers should refuse to sign any such a listing agreement that they don't like, especially those with automatic extensions of time at the end. Sellers should get involved and educated about the process.

Sounds like a racket to me, and the racketeers are a good part of the reason realtors are one of the least respected professions, aside from the lack of educational requirements.

That is not right.

Jeeze Louise... Incredible... this kind of bolony used to happen in Florida, but i am very happy to say NOT ANYMORE. It is disgraceful that agents can get away with this. In Florida you can write automatic price reductions into the listing agreement and explain this to the seller because the seller thinks they know more than we do about what their home is worth. If there is no traffic after 30 days start reducing the price. After all, i know i am not into signing my death warrant by keeping an overpriced turkey that will never sell on the market,, when i list I intend to sell, isn't that what the seller wants in the first place?

I can't speak for the listing agent, but the only thing i can think of is that this listing agent must be thinking that the more signs and riders he has out there, the more calls his office will get with questions about the price and the agent on floor aims at turning them into buyers? who Knows?

But anyway, i think this automatic listing agreement should be outlawed all over the country, so many sellers feel embarrassed, and/or too intimidated, or sweet talked into staying with him and not cancelling? who knows what is in the sellers head, i know if it was me after 6 months the agent would be taking a hike (automatic re-list or not,, CANCEL) and no amount of bolony would pursuade me otherwise.

So many sellers believe this is common practice, but not in my book. If there is fine print stating that fact, then is should clearly be disclosed. I remember an agent that was putting in her employment agreements that if a buyer purchased a home, when they were ready to sell, they had to list with her. Now, that's bad!

This is not only unethical but in Florida it's illegal F.S. 475.25(1)(r) as I believe it is in many states. Check your states real estate license law.

You need to turn them in to the MLS listing service. This has got to stop. Beth

I took a look at Tennessee law and found that this is illegal under 62-13-312(9) which states.

(9) Using or promoting the use of any real estate listing agreement form, real estate sales contract form or offer to purchase real estate form that fails to specify a definite termination date;

Tammie, I recently had a seller in a similar situation contact me, they let their automatic renewal listing agent go then listed with me. They seem to like getting me on the phone when they call, and hearing from me on a regular basis. Now I have to get it sold.

Tammie, it continues to amaze me how many real estate agents are unscrupulous and yet, are successful. Unfortunately, these kinds of agents give the rest of us professionals a bad name.

Tammie, like the gal in NC pointed out, we in California also have CDOM. Still, if 30 days elapse, the contract can be renewed by the same agent as a "new listing" thereby getting past CDOM "cumulative days on market". I am aware of a listing that the same agent was allowed to renew and renew and renew, but if we count actual CDOM the listing with that same agent has sat for almost 600 days! I really wish these agents who only care about themselves would leave the business and leave it to those who care about the lives and futures of their clients. Oh, and the "team thing" where one agent credits themselves with sales they did actually take any part in...don't get me started! It's time for honesty and scruples!

T, Oops, I meant: " the "team thing" where one agent credits themselves with sales they did NOT actually take any part in..."

MAY

2010

Sounds like an automatic re-list should have a mandatory 3 day attorney review for the seller. Was this a large company or a smaller broker?

I am unfamiliar with the relist game. I would never give my Seller that as an option because if they don't think I am doing a good job I would want them to let me know. Not a common practice in my part of the woods.

Laurie

Sorry Tammie I can not agree with you that the problem is the listing agent-- he is getting the listings, right? I can not agree the problem is the seller, anyone that can afford a $800k ok a $500k home she be smart enough to handle, or cancel a listing.

Right now the problem is you! You have to make your listing presentation or phone skills strong enough to turn those sellers into your listings, reads like you are talking to the sellers just not converting into clients.

Tammie,

You stated that the seller said she had never met the agent. Whom did she get the listing presentation from? We have the cummulative days on market here and you can check on the history of a specific address here. Also the Seller contacted you so in fact you could have spoken to her and gotten any information from her that she wanted to share which would have made you look like the professional and not him as you could have read through her contract if she let you and you could have explained to her what she had signed. This goes back to why a good Realtor educates their buyers and sellers and well others are just sales people that are in it for themselves. I hope you pursue this with your MLS board and have the practices changed that will reflect true reporting.

Good luck and if things do change we all look forward to being updated as to the outcome.

This is actually a "new one" for me! I thought I had heard everything!

I do not know what to say. I work so hard and have this kind of crap happen all the time. I guess if you treat people like s--- they just love you.

Hi Tammie; I do agree with you that some agents are either greedy or desperate. NOT selling a home in a resonable amount of time benefits no one. Continuous price reductions means the agent does NOT know the market of the seller was stubborn. Locking someone in a contract that never ends is futile and not good business. I've seen agents requesting buyers to sign a Buyer Broker agreement for a period of 12 months. The greed/desperate aspect falls into place here too. Does that mean you think as an agent that you will not be able to find your buyer an appropriate property within ninety days? If it is an investor do you think they will not appreciate your services enough to continue to utilize you? Are you so unsure of your capabilities that you need to paint the other person into a corner? Are you desperate enough to bind one client because you think you won't get another? Are you so greedy that you feel you must have all the business regardless of how efficient or inefficient you are in providing service to them? One thing I have learned is I am willing to work with any client who is willing to work with me but I can let go (fire) any who are not (ie: sellers who are unrealistic; buyers who mention other agents etc.).

Sounds like this "Realtor" could save himself even more time by preparing 5 year listing contracts with automatic monthly $10,000 price reductions.

Wow, I'm late to the game here but I also don't understand why any sellers would put up with this. Sometimes I'll take a listing that is unique and hard to comp out. After many showings (or few) without an offer, sometimes listings expire. I get some of them to re-list with me but not all. Some I don't even want back based on negative feedback and uncooperative sellers.

In fact, most of the listings that have expired with me have gone to list with 4-5 more agents (you almost hate to the be the first agent on some unique properties, especially in this market), never keeping the same agent for that length of time. Oh well, I guess this listing agent has his own little system going and it's obviously working for him.

Yikes! This so called 'agent' should be reported for their unethical behavior. He/she/they are doing everyone a disservice and giving us all a bad name.

Lisa Wiseman
Realtor, SRES, CDPE
Intero Real Estate Services
San Jose, CA
www.BayAreaHomesForYou.com

Top Draw because of a big name that this seller has been drawn to. This type of seller, while complained to you and you did everything right, is one that desires to have that particular Realtor's name tagged to her/his home as it is important because "joe smith" sold my home for me. This gives the illusion that they got top dollar for their property when in fact they debt service ratio ate their equity right off the table. I never heard of automatic renewal on a listing.

Bottom is, you care. Most agents don't care. They do not treat the listing as if it were their own home. I have a listing appointment this week where the property was listed four times by different Realtors. The sellers can't figure it out. Top names, top companies. One look at the photos and one can easily tell that they need to declutter and neutralize. Stage and drop the price $30K and they will go out the door to SOLD.

To me, it's like the homeowner has this awesome Audi sitting in their garage. Doesn't work, looks good, gives a sense of status but when the neighbors know that this awesome car doesn't work but sits. Sometimes status is more important then self-worth. That is a shame.

I know exactly what you are talking about but this seller is pretty weak, uneducated, doesn't care about their financial future as it is being eaten alive by the economy and negative equity. But hey, "Joe Smith" sold my property. Sometimes people complain because they know that they cannot complain to this awesome top gun Realtor who sells alot but has the longest market time and hence, causes serious loses for his clients. This is not a client that you want.

Oh my Goodness. I cannot believe that the Seller would not want to list with someone else after all that. It's hard to believe they thought they were getting the service they deserved. Especially since the listing agent had never even met the Seller! It's also probable that this listing agent was marketing a property they had never even stepped foot in.

I am so appalled to hear stories like this, because that is why Realors don't have a better reputation. I see listing agents in my neighborhood who are very popular. People love them. And their signs sit there and sit there...

An article I posted on EzineArticles.com over four years ago consistently gets more views than any of my other real estate articles - month after month. To date, it has been viewed 6,419 times.

Since almost 4 people per day have read the article - for the last four and a half years - I think it's safe to say that it is a subject that concerns a good number of people. The title is How to Fire Your Realtor

Sellers like these need and want to fire their agents, and they're searching for advice.

Maybe when you run into someone like this you could print it, put it in a plain white envelope, and send it to them... At least let them know they don't have to remain stuck.

Of course - there will still be those few who won't speak up because they're afraid of confrontation.

Wrong, wrong, and not only that, it's wrong!

As Realtors, we have an ethical obligation to always paint a true picture. The practice you described is not adhering to those ethics. However, the same practice is used in our area by more than one agent, but no one polices it. Combined with that, some of the same agents are purposely overpricing the listings to beat out the competition, but when the home finally sells it almost always sells for far less than the original asking price.

That's a tragic story. It's realtors like this that give the rest of us a bad name.

The method may be a way to make alot of money fast. Not the kind of customer service I would want if putting my own home on the market. And I surely would not endorse the agent either.

unscrupulous? maybe.

illegal? probably not. i would be willing to bet that the clever agent has run this by legal

slimey? and how! let's hope that listing agent doesn't get wind of scott leaf's suggestion in #171.

that said tammie, you did NOTHING wrong by taking a call from a potential client who was making the first contact. i felt the conflict you had and the deft way you handled it.

i do have to disagree with you in regards to your statement that a seller owes nothing to a listing agent. the seller DOES owe something to the listing agent...among other affirmative obligations, they are obligated to cooperate in the marketing and sale of the property as an inducement to have the listing agent devote their efforts to the sale. the several agents here suggesting that the seller simply cancel the listing need to revisit the elements and obligations of a contract and the penalties for breach. anyone advising HOW to cancel a contract or how to encourage someone (like a friendly lender) to suggest breaching a contract needs to run that one by their broker. the topic of interference should be your main point of discussion.

I don't know about other states, but in Florida it's illegal to have that terminology in a contract. We definitely cannot legally have an auto-renewal clause.

OK. I just read a couple of TACKY (no class) comments! I won't say by whom, but I do believe we have a few agents here who wouldn't hesitate to behave in this same type of unscrupulous, unethical, and possibly illegal behavior! And THEY make my blood boil!

JUN

2010

I'm surprises this seller allowed this to continue. You would think she would have gotten tired of the time it took and the lack of contact sooner.

It's unfortunate this team issue is something that takes place in many cities. People are enamored with numbers. Most of the time they mean nothing.

Here in the Phoenix area, our MLS has done a good job of stopping the fraud that was taking place with the DOM. I believe if you are caught trying to manipulate it, you will be kicked off the MLS.

Wow, this is a lot of comments. The slimeball agent has the charm to keep his clients loyal. Unfortunately, most sellers don't have a clue. They like him, they believe him, they stay with him. They are probably also impressed by his team. We have agents here who fool people all the time. The homeowner wants to sell their house; the agent wants their sign in the yard - lots of yards. It's free advertising for the agent. They use the signs to get more listings. They talk a good game. People think they're great. If the Board or the MLS won't reign him in, he'll just keep going. Often, when forced to comply with the rules, the slimeballs find a way around them. And find a way to spin the story so his loyal clients feel sorry for him and send him even more business. Sad.

I have never heard of an automatic extention here in Florida. We must have an end date and I do not believe auto extention is allowed. Statistics can be manuevered around. I do not understand the seller being so dissatisfied and going on for 2 and a half years!

Regardless if the listing agent is unscrupulous or not. .a contract has been signed and if there is no law that has been broken, it should stand.

I'm not sure if an extension is even allowed on my local board but I would love to hear his scripts when he comes to the area of the listing agreement extension. . .that should be interesting to hear.

"This is in case I can't sell your home in 12 months. . initial here and you will give me another 12 months!"

"You want me to sell it don't you?"

Another stunt that I have seen done is that every time an agent would get a price reduction, he would have the addendum written to also extend the listing whether it was near expiring or not.

Unscrupulous beyond belief, but also even more stupid of the sellers beyond all comprehension. Not just for signing such a ridiculous contract, but also for listing with someone who has such a large team that he can't even speak to you in person.

How frustrating! Next time you call one of his expireds you should bring up what you have found about his statistics and point the seller to this blog. How he stays in business is beyond me.

This is amazing. Please let us know if this turns out to be illegal. It's clearly misleading and unscrupulous.

I don't think that the agent is doing anything wrong at all. The contract has an end date, but the seller signs an extension up front. He discloses up front that ihow he works and gets it signed off on paper. He has a high retention rate. The seller is obviously alright with it because not only do they agree, but when the sellers you've spoke to continue to relist with him even when they don't expire. These are intelligent adults, not helpless children, so they are quite capable of making up their own minds. The guy has been successful if he has that many listings and awards. Must not be too bad.

If you are dissatisfied with his retention, perhaps your listing presentation or expired scripts could use a little work. Then you can start to take over his expired listings at a reduced price.

Well Put article. I am going to link this blog to my web site. I see this all the time. It makes my job much easier when I go on a listing call the I ask, "what did you think of the last agent that listed your home." And the answer is, "I never saw them after signing the contract."

JUN

2010

I've never heard of such an agreement but I'm quite certain many large teams use it out of convenience. I can't believe that seller kept relisting for 821 days. Ouch. That gives us all a bad name.

JUN

2010

How he gets sellers to agree to this is beyond me. I do not believe what he is doing is necessarily wrong it's just how he chooses to do business.

JUN

2010

Any update on what the real estate agent and the real estate board had to say about this?

Surprisingly, I haven't heard from the agent and I'm still pursuing this with other channels. I will keep you posted.

JUN

2010

Wow! That's pretty incredible that Sellers would agree to this. Days on market and total days on market are being manipulated every where.

JUN

2010

OMG! I have never heard of such a thing. How does this agent get NEW listings??

JUL

2010

I wonder if the Seller was elderly and taken advantage of by this agent. That makes it even more wrong. This just doesn't make sense. There is more to the story than we are all aware. Why would the Seller allow this listing contract to continue so long? What is it a haunted house or something?

JUL

2010

Several years ago I went to a listing consult with some sellers that had told me that they were going to interview that same team. I did all the research on selling times, printed it, and presented it to the sellers explaining how sometimes the DOM may not be what they seem, pointing out the expired and withdrawn listings and how they had been relisted to give them an accurate DOM. I simply stated that as a a matter of practice, I did not maniuplate my mls listings to show that I could sell a house in X number of days. I never mentioned the team - to do so would have been completely unethical - but it didn't take them long to see how the game gets played in our MLS.

For those agents in areas where the MLS clock keeps ticking even after they expire or re-listed - good for you! It requires a whole lot less research to get to the actual truth.

As for an automatic listing renewal, that might make for an interesting contact at the TAR hotline. Is it okay if the seller agrees to it up front? It may not appear to be a good practice, but perhaps it IS legal.

JAN

2011

Sounds pretty unscrupulous to me. Other thoughts?

We agents love a "juicy story" don't we . . . --JM

Jon - It is definitely deceptive to say the least.

SaraMana - I'm not sure I love a juicy story. I prefer honesty when dealing with clients.

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Tammie White Realtor® Franklin TN Homes For Sale

Franklin, TN

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Benchmark Realty, LLC

Address: 7127 Crossroads Blvd, Brentwood, TN, 37027

Office Phone: (615) 371-1544

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