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Do You Have a Market Conditions Disclosure

By Adam Brett

Real Estate Agent with The Adam and Eric Group 01499486

August 26, 2007 09:14 AM

My brother in law is an E&O lawyer and he told me to start using a Market Conditions and Pricing disclosure. I looked at the C.A.R. form and it is for the buyer, but I am looking for the seller.

To protect ourselves in an unstable market, we tell our sellers we will try to get them top dollar, but the market can change quickly and that is out of our control. Also, about pricing being set by them with our guidance.

My brother-in-law is defending 2 cases where sellers realized less than the were 'told' by their Realtor at the start of the listing, and now want compensation.

I was wondering if anyone is using a disclosure (not that it means much in front of a judge), but something to mitigate a potential problem.

Here is the C.A.R. for buyers

Market Conditions Disclosre

Adam Brett
RE/MAX NOC
Fullerton, CA
714.496.8116
800.977.ADAM
realtoradam@gmail.com
www.realtoradam.com
http://activerain.com/realtoradam

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Lenn Harley

Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA

Real Estate Broker - Virginia & Maryland

On the contrary. Your brother-in-law is giving you good advice. I believe it would make a lot of difference before a judge. In fact, most cases rise and fall on the documents. That's why we keed files for 5 years.

We've always had a Competitive Market Analysis (formerly "Comparative Market Analysis" form signed by the sellers to verify our recommended price. It goes right in the file.

The secret, of course, is to refuse to take overpriced listings.

Aug 26, 2007 09:28 AM

Lorna Hill

MVP Realty - Strawberry, AZ

Pine & Strawberry AZ Real Estate Agent

Interesting form. Our state has not adopted anything like it so far. Wish it would. We have a lot of disclosures in our contracts. There are those who will look for someone to blame no matter how good we do our jobs.

Aug 26, 2007 09:51 AM

Kathleen R. Cosner

Cutler Real Estate - Akron, OH

Interesting, Adam. But aren't the sellers the ones that accepted the terms/conditions of the offers? Personal responsibility seems to have left town.

Aug 26, 2007 11:33 AM

Christine Bohn

RE/MAX Professionals - Gainesville, FL

The Bohn Team, Gainesville FL

Sounds kinda scary that a seller can sue their agent if the market falls?? I sure hope we don't see that coming in Florida. Interesting post!

Aug 26, 2007 11:46 AM

ALEXANDRA VINSON

COLDWELL BANKER ROYAL REALTY - San Diego, CA

I actually had a similar threat a year and half ago. (some areas of San Diego started plummeting early). Luckily, my disclosures saved me. I now always use the market conditions advisory, I also make each seller sign the cma (every page) my broker is even making me have the buyer sign a cma. Its better to be safe then sorry.

Sep 04, 2007 04:31 PM

Gene Allen

Fathom Realty - Cary, NC

Realty Consultant for Cary Real Estate

Christine it sounds like Adam said the agents more or less promised to sell the homes at a certain price. I know people oversell and under deliver on purpose to get the listing and leave others out in the cold. Never seen the market advisory and never had any one discuss it around here.

Sep 05, 2007 08:28 AM

Adam Brett

The Adam and Eric Group - Fullerton, CA

The Adam and Eric Group, Fullerton's Finest

Alexandra said it well. Better safe than sorry. I am taking price reductions across the board, and I never want to hear I was behind the curve and lost them money. I am an educator and they are the decision makers.

Sep 13, 2007 05:03 PM

Sandi Bauman

Chico Homes Real Estate - Chico, CA

Chico CA Realtor

I've been using this form ever since it came out... it always made sense to me, especially for the buyers.

Sep 17, 2007 01:27 PM

Do You Have a Market Conditions Disclosure

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