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I am in the market to buy a home, and have had my eye on a particular neighborhood.
A house went up for sale last month in this development.
Details of house are:
4700 sq. ft.
6 bed/ 5 bath
pool/jacuzzi
4 car garage
ocean views
excellent school district
House was first listed at $1.2M, then dropped to $999K after 12 weeks, then $900K a week later. So once price went to $900K, there was a flurry of activity... like 6 showings per day. Not surprising since asking price is only $190/ft, where avg sale price/ft is around $260.
I was planning on submitting an offer, but my realtor told me that he said this deal sounded weird. His gut feel is that the listing agent dropped the price so low so quickly to generate a lot of interest in the house, but will only present offers from agents in her same office. He can't prove it, but said this is what he thinks is going on.
My question is is this legal? What's the point of doing this? It's not like the listing agent will get more commission right?
That's a harsh accusation your agent is telling you, especially with no proof. If this listing agent is a REALTOR and not just a real estate agent, no, she's not allowed to not submit offers unless she has something in writing from her seller not to submit them. But then it wouldn't be in the MLS if the seller only wanted offers from the agent or her office because she would market internally to the agents in her office.
She might have lowered the price to get a lot of interest for the buyers to have a bidding war. You'll never know unless you submit an offer. You can always ask for proof of rejection like the sellers initialing the first page with a big line through it...
It is possible that the listing broker provides a slightly larger split to his/her agents for intra-office deals but I really doubt that the LA is withholding offers. Your agent has the right to ask to present your offer directly to the seller, though, so that might be one way to be sure the offer is seen. Of course, the seller may not want to see your agent. In that case, your agent might ask for a signed receipt for the offer from the seller. Unfortunately, there's no guarantee any of these things will actually work.
My realtor said he is seeing/hearing about this type of tactic more and more recently.
I would not question the other agent as much as I'd question the skills, ability & knowledge of your agent. The goal of any listing agent is to get it sold, not reject willing & able buyers.
He could have some type of exclusive agreement with the seller but if so putting the house in the MLS for all to see would be against their goals.
If your buyer agent feels that is the case, then why doesn't your buyer agent ask to present the offer directly to the seller with the listing agent present? It is their job to ADVOCATE for you...so have your agent write your offer and make sure it gets presented. That's his job.
In Oregon all real estate licensees have to present offers per our state laws. Has nothing to do with real estate agent vs. REALTOR status in Oregon.
Silverfall, out of curiosity, when you say all licensees have to present offers...do you mean all offers must be presented to the seller or do you mean that the agent representing the buyer must present the buyer's offer directly to the seller?
Silverfall, out of curiosity, when you say all licensees have to present offers...do you mean all offers must be presented to the seller or do you mean that the agent representing the buyer must present the buyer's offer directly to the seller?
I mean that a listing agent must present any written offer to a seller, unless the seller has given them specific instructions not to present an offer say below a certain amount.
In order for a buyer agent to present an offer to the seller the listing agent has to give permission and they are typically present for it.
I don't get it. If this is a new tactic please explain the advantage to me. Why do this?
Because some real estate companies offer their agents a higher split if the transaction stays in house on both sides. By presenting only offers from her office, she gets more money.
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