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I was under the impression that it was unethical for realtors to disclose offer prices on homes that haven't yet closed escrow. Here's what we experienced:
We were in price negotiations with a seller for a house. We arrived at our offer price based on what we thought was the complete picture: location, condition, comps, etc., and limited it to our "best & final". During the negotiations, our broker and the seller's agent phoned/emailed back & forth, and when we pressed them to "prove" to us the neighborhood supported a higher price than we offered, the seller's agent provided sort of a list, which included some homes that had just gone under contract or were about to, including the supposed offered/accepted prices. No one will know for sure what those homes' actual sale prices are until they close, though!
So, here we are left scratching our heads. How is it the seller's agent knew, for instance, "House B on the next street over just accepted a full-price offer," or "House C is in worse shape and it's about to close for $X"? And even if she knew that info, isn't that info supposed to remain undisclosed until escrow closes?
In the end, we happily bailed out of the negotiations for that particular house, but I'd still like to know the answer to whether this sort of thing is OK. We're in California, BTW, if that matters.
Not a realtor, so I am curious to hear to correct answer.
But, my assumption.... those houses are under contract. You could submit a back-up offer, but unless the buyer backs out, the seller can't do anything about it even if you offered them 10x the current contract price. I think it is still shady, but it may skirt the line of ethical because they are in escrow.
I was under the impression that it was unethical for realtors to disclose offer prices on homes that haven't yet closed escrow. Here's what we experienced:
We were in price negotiations with a seller for a house. We arrived at our offer price based on what we thought was the complete picture: location, condition, comps, etc., and limited it to our "best & final". During the negotiations, our broker and the seller's agent phoned/emailed back & forth, and when we pressed them to "prove" to us the neighborhood supported a higher price than we offered, the seller's agent provided sort of a list, which included some homes that had just gone under contract or were about to, including the supposed offered/accepted prices. No one will know for sure what those homes' actual sale prices are until they close, though!
So, here we are left scratching our heads. How is it the seller's agent knew, for instance, "House B on the next street over just accepted a full-price offer," or "House C is in worse shape and it's about to close for $X"? And even if she knew that info, isn't that info supposed to remain undisclosed until escrow closes?
In the end, we happily bailed out of the negotiations for that particular house, but I'd still like to know the answer to whether this sort of thing is OK. We're in California, BTW, if that matters.
If the agent has actual knowledge of the contract prices, and no agency relationship in those transactions, there is no restriction on discussing that knowledge.
If the agent has knowledge because they are involved in the transaction, or a team mate or coworker at their firm is involved, the agent may well have breached ethics.
I.e., so I am having a cold one with Agent Joe, and he mentions that his listing at 123 Elm Street just went under contract at list price. Shame on Joe for blabbing, but unless we work under the same broker, there is no expectation of confidentiality in the eyes of the law, no ethical restrictions, either.
I may well be properly serving my client by mentioning the discussion.
If the agent is winging it, and just making stuff up, that is a whole 'nother kettle of fish.
Regardless, I would be hesitant to put a lot of value into the "information" unless the properties were closed and recorded.
I'm confused though...did that information come before or after you submitted your "best and final" offer? If after, why didn't you just say "I already submitted my best and final offer" instead of bailing out of the negotiation?
If the agent has actual knowledge of the contract prices, and no agency relationship in those transactions, there is no restriction on discussing that knowledge.
Interesting. There is no evidence (at least as we can see) of any agency relationship there.
Quote:
Originally Posted by MikeJaquish
Shame on Joe for blabbing, but...
Yeah, well, seems there's not much shame among some realtors.
Quote:
Originally Posted by MikeJaquish
If the agent is winging it, and just making stuff up, that is a whole 'nother kettle of fish.
Regardless, I would be hesitant to put a lot of value into the "information" unless the properties were closed and recorded.
THIS! This is exactly why all the gossipy back & forth makes no sense. The only way anyone can know whether the agents involved are winging it or making stuff up is to wait until the properties in question close.
Agents talk, period. They aren't supposed to, but there is nothing wrong with me calling an agent and asking what their contract price is. I always expect to hear that they can't disclose, that's ok. I don't disclose when people and /or agents ask me. You would be surprised how many disclose it, which is why I always ask if I'm needing further information. As an agent, I have every right to tell my client the information I found out.
As stated, nothing matters until those properties close at those prices.
To me it seems unethical for the listing agent to give such information as offer pricing; however, if that agent tells a perspective buyers agent then the buyers agent is not in the wrong giving their clients the info received. Personally I would have walked too, not playing games!
This is exactly what we stated...which is what ended the negotiations.
OK, good that you stood your ground. So what are you getting at? Do you think they were able to get a higher offer from someone else due to sharing that info which you didn't think should be shared?
I was just *getting at* whether my notion that sharing price info on homes that haven't yet closed escrow was OK/ethical/whatever. I thought I remembered being told or having read that this wasn't ethical. And not only that, I didn't like the game the seller's agent seemed to be playing when I had no way to verify her assertions.
And it seems, from the answers I've been given here, that this "shouldn't" happen, it's probably not totally OK yet isn't illegal, borders on (or is) unethical depending on who's telling whom, and is perfectly acceptable/understood if one agent asks another for this info and the request is denied...but once the cat is outta the bag, though, the info is fair game to share.
Now that I have this info, I'll be better prepared if I should encounter this type of thing in the future. Not that it will help in any monetary way, but if I'm not distracted (I guess) by this type of gamesmanship, it will help with keeping a cool head.
Quote:
Originally Posted by GoPhils
Do you think they were able to get a higher offer from someone else due to sharing that info which you didn't think should be shared?
Since you asked...
After we submitted our best & final (which didn't seem to deter the other agent from coming back to us for yet another shot at it), the gossipy story we got was that there was another buyer in the game and the seller was expecting to receive an offer from them of $X, which was supposedly enough to reach an agreement. That dollar amount was $17K higher than our best & final. There was no way we would've considered going that high, but alas, the other buyer (we were told) bid yet another $6K. That was probably to try to beat us out -- even though we had already bailed out. If all of that is true, it would appear the other buyer bid $6K higher than the seller was prepared to accept.
Maybe the other buyer loved the house that much (we didn't) and/or that amount of money wasn't significant to them. Who knows? Who knows if the house will appraise? Who knows what concessions the seller will have to make? Who knows if it will fall out of escrow? Who knows what the final selling price will be once it closes? That last one, at least, is a wait & see.
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How is it the seller's agent knew, for instance, "House B on the next street over just accepted a full-price offer," or "House C is in worse shape and it's about to close for $X"? And even if she knew that info, isn't that info supposed to remain undisclosed until escrow closes?
