There are no shortcuts on the road to success. In fact, on your journey you’ll probably have to pass through the dumps before you reach your final destination. That being said, one shortcut I’ve been seeing a lot more lately in our profession is the withholding of offers. This is a tactic I DO NOT ENGAGE IN or CONDONE.
I will examine my current market in Los Angeles, CA. Right now, we have a SHORTAGE. That’s right an undersupply. With all the talk of REO’s and the rash of FORECLOSURES one would assume we would be in the midst of an OVERSUPPLY–but this is not the case. How can I say this you ask? Easy, there are only two types of properties on the market: the ones that SELL within 48 HOURS and the ones that DON’T SELL within 48 HOURS. PERIOD. Either the property is priced right and there are overbids & the property sells–or it is overpriced and the property just SITS. That’s it. This has created a false surge in pricing and the media has picked up on it touting the RISE in PRICES and the RECOVERY of our RECESSION. Smoke and mirrors say I. But that’s a conversation for an ENTIRELY DIFFERENT blog entry.
So now we know what the market’s like–let’s analyze some current unethical practices. Namely, not submitting ALL OFFERS.
As agents we are REQUIRED TO SUBMIT ALL OFFERS. However, just like in every profession there are a few rotten apples that spoil it for the rest of us. Because of the shortage and the overbids, it has become increasingly easier for agents withhold offers and ONLY SUBMIT the offer represented by themselves. This obviously puts other buyers at a disadvantage, and in MOST CASES PREVENTS the NATURAL RISE in the SALE PRICE of the property from reaching market value due to simple SUPPLY & DEMAND.
This is obviously unethical and frustrating for all parties involved. I’m not naiive, and I know as real estate agents in California we make more money when we represent both the buyer and the seller, but at the expense of my integrity, losing my DRE license, and losing my clients–IT’S NOT WORTH IT. And for those of us who think, “Awe, they’ll never find out…” you are wrong! See there’s agents and buyers out there that have no qualms about going DIRECTLY to YOUR SELLER. And REO Brokers, don’t think for a second that just because there’s an asset manager between you the bank that the bank won’t find out! I’ve SEEN FIRSTHAND the horror of an agent get a property IN ESCROW REASSIGNED and be forced to explain to HIS BUYER why the SELLER had LEGAL RECOURSE to CANCEL the escrow that the agent had double dipped on!
Remember, “You don’t have to do anything wrong to get sued.”–Or accused of unethical business practices for that matter. Recently, I had a selling agent, who’s offer I submitted through RES.net, go over my head and contact my asset manager even AFTER I explained to the selling agent that their offer was 100% beyond a shadow of a doubt submitted and rejected. My AM confirmed that reviewing it and rejecting it and I was told to convey this message to the selling agent. It didn’t bode well with the gentleman, but que sera sera. I was at peace with myself. How much of a common practice has this become that even when you do the RIGHT THING people are still doubting you?
And you know what? Even if your buyer’s offer is competing against better offers and it’s your listing, SUBMIT THEM ALL ANYWAY! You’ll have more credibility to your clients! They’ll know that you’re a stand up person and will do the right thing anyway. This has happened to me MANY TIMES, and in the end, even if my buyers don’t get to purchase my listing right away, IF the escrow BOMBS, guess who has a good chance of getting it the 2nd time up to bat? That’s right–YOUR BUYER! Most of my sellers, lenders, and AM’s think about MY BUYER FIRST because they expect that I’ve done a better job PRE-APPROVING them!
There you have it. Now let’s do the right thing.
There are 4 elements to this marketing mix:
