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Price Versus Value- short sale agents under fire in Naples FL, Mike Rivera

By
Real Estate Broker/Owner with Mike Rivera, Saggio Realty Inc

This is an e-mail i just got from an agent it deals with short sales and there apparent irritation with short sellers and there agents. And it seems this agent wants a law against them or that the FREC should stop it and  deems that The Pricing of short sale are misleading or For pricing them way below true value....

And see below quote

Fraud on The Public From "Impossibly Priced" Short Sales ("  I believe that such "way below the real price" listings violate Fl Statutes Chapter 475.25 (b) and (c).   I believe the advertising of these properties at unrealistically low prices is a "misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme, or device ... in a manner which is fraudulent, false, deceptive, or misleading in form or content." I further believe the public in general is misled about the current market price of comparable properties by the false advertising of an artificially low price for such properties.

Ok so now let scan the above.

Price Versus Value.

Comps vs listings

As a real estate appraiser for over 8 years and a broker for 15 + I came across many agents who would give me crap over there price when i could not justfy it or Illegally meet it. And they would use Mr agent B and X and so and sos listing as a basis for there perception of  price and in there mind real value.This is why appraisers have so much training that agents do not. And on top of that follow strict USPAP guidelines. And guess what the debt holders still got screwed. LOL

I do understand the issues we all have with short sales that are not approved or the paper work done at lease. It is total frustration I do agree that shorts sales are not easy and it is 2 sellers with 2 opposing agendas, they should have  the 2 sellers with basic agreeable & disclosed conditions.

Price is not always going to be one of them... because know-one is going to pre-disclose what they will accept high or low.  Now sometimes you do get a lender to agree to a certain offer ranges and that should be attempted by agent and sellers. I dont think you can have regulation, this is competition between buyers,owners and lenders... agents must do ther best too deal with all 3 and act acordingly

Lets see the full e-mail statement sent to me.

I will post with my reply e-mail sent back to the persons in agreement with them.

E-Mail 11/11/2008

Hi,

I fully support this. I am getting a ton of calls and emails about his Broker DXXXX's GGE homes priced at half of their market value. Don, you and I both have experienced the XXXXX's properties.

Fraud on The Public From "Impossibly Priced" Short Sales

The SUNSHINE MLS service has no rule which prohibits members from listing properties for sale at a price well below that which the listing party (the member of the MLS) knows will be acceptable to the seller. Most of these properties are "short sales" where the listing party knows that the listing price will not be acceptable to the seller's lender(s).

I believe that such "way below the real price" listings violate Fl Statutes Chapter 475.25 (b) and (c).   I believe the advertising of these properties at unrealistically low prices is a "misrepresentation, concealment, false promises, false pretenses, dishonest dealing by trick, scheme, or device ... in a manner which is fraudulent, false, deceptive, or misleading in form or content." I further believe the public in general is misled about the current market price of comparable properties by the false advertising of an artificially low price for such properties. This has the effect of distorting the public's perception of what comparable properties are worth and constitutes a general fraud upon the marketplace which would be prohibited under Fl Statutes Chapter 817.06 if such Statute were held to cover the sale of real property.

Consider a few examples all of which might involve waterfront property:  a)  list price $10,000  where the Seller owes more than $240,000 and the property appraises above $180,000; b) list price $825,000, Seller owes more than $1.9 million, and the property appraises above $1.5 million and c) list price $975,000, Seller owes in excess of $1.8 million, and the property appraises at $1.8 million.  In each case the general marketplace is distorted.  Prospective buyers and sellers of other waterfront property are being deceived by the false price publicly advertised on these properties.  As result of the deception buyers believe that comparable property is worth LESS than it might otehrwise be.  Both clients and agents have significant time wasted due to the false expections created by numbers falsely claimed to be "prices" but which are little more than guesses of what number might generate a string of offers.  How is this ethical?

It is my understanding of the laws of the State of Florida that a Seller who publicly advertises an item for sale at a price at which it cannot be obtained from that Seller has committed fraud by virtue of false advertising.  The same standard should be applied to real estate.

I am of the belief that it is the absence of any prohibition against offering a property for sale at a price which is known by the listing agent to be unacceptable to either the Seller of the property or to parties who hold a mortgage lien on the property which creates the unethical, abusive, and potentially illegal behavior.  A rule which required Sellers to publicly acknowledge when the listed price of a property is less than the then current amount of any and all mortgage liens thereon and to either indicate Seller's willingness to make up the shortfall or approval of the lenders of a lesser list price would prevent the abuses of current practice.  At a minimum listing prices which are unapproved by the Seller's lenders should be treated as the equivalent of  a suggested opening bid in an auction and not be falsely labeled as a "price."  Price is a quantity at which something can be purchased not a quantity which is known to serve only as an opening volley for back and forth negotiations.  We do not allow auctioneers to list property at $1.  The short sale practice above is little different.

I have referred this matter to the Attorney General's office seeking for both the Attorney General and the Florida Real Estate Commission to publicly state that the practice of offering a property for sale at a price which is known by the listing agent to be unacceptable to either the Seller of the property or to parties who hold a mortgage lien on the property constitutes a prohibited advertising practice under Chapter 475.25 (c).

I would appreciate your writing to ag.mccollum@myfloridalegal.com in support of my position.

Note all of the language above is personal and does not in any way reflect the opinion of the firm where I hang my license.

 

Your coments or thoughts on this e-mail sent to me.

I will reply and post with my e-mail to them.

Mike Rivera SR, ABR,CAM

Investment Real Estate Analyst
StarCapitalGroup
Naples Fl

239-770-6257
Fax 239-775-2066 http://www.starcapitalgroup.blogspot.com www.condokmanagement.blogspot.com
Mike Rivera & Associates,LLC MikeRiveraSR@Gmail.com

 

 

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