My team and I recently had an interesting experience which I’d like to share with our readers. Last week, we placed an offer on a condominium offered as a short sale at the Murano Grande in Miami Beach. We only went through the effort of contacting one of our most loyal and best buyers after receiving a solicitation on behalf of a distressed owner who I happen to know (this South Beach condo is listed with a family friend). Unfortunately, shortly after submitting a contract significantly ABOVE the list price, we discovered that the price on the Multiple Lisitng Service was raised several times, and that the commission to cooperating Broker was changed to one percent (with total commission payable of six percent).
Here’s the problem – our ready, willing and able CASH Buyer was completely turned off by the lack of coherent pricing. Also, all short sales and bank foreclosures which we have dealt with in the recent past (and we’ve closed on many) stipulate commission splits of 50/50 between the buying and selling brokers. We subsequently found out that the listing agent for the condo convinced the current owner to accept a finance contingency contract (his own buyer) at a significantly lower price. Not only was this agent acting unethically with us, but the worst part is that the owner (and the lenders) have no idea of the games that this particular agent is playing in a desperate attempt to earn some extra commission income.
I firmly believe, especially in this market, that it’s an agent’s duty to do everything possible to sell a property for as high a price as possible to a QUALIFIED buyer. Any agent (or Brokerage firm) that is not willing to work for the best interest of their client should no longer be in the business. The old adage applies – “Let the Buyer (and Seller) beware.”
Latest Closed Sale from TheKleerTeam (Buyer Representation):
Continuum condo - North Tower #1404
Continuum North Tower presents over 15 styles of residences, with this unique split two bedroom floorplan offering views of Fisher Island, the Atlantic Ocean, and Government Cut. Residences feature private balconies with glass railings, floor to ceiling sliding glass doors with tempered, tinted glass designed to meet hurricane standards of the South Florida.
Closed Sales Price: $1,250,000 (7/1/09)
Original “For Sale” Price : $1,425,000
Bedrooms: 2
Bathrooms: 2.5
Sold Price per S.F.: $838/S.F.
Reduced from Original Price: 12% (106 days on market)
2 Comments
My complete sympathy. As a realtor, I have seen this business which once upon a time had rules, being often subverted and mocked by banks, agents, buyers and sellers.
I had a funny case, where my client, a cash buyer, put in a cash offer on a listed short sale. After a few months, the listing broker was dismissed by the bank,which had foreclosed on the property, and a couple of days later, the bank-owned property was sold thru a new broker for 25% less than our short sale offer!
I call it funny; in reality it can be outright bank stupidity, bordering perhaps with something much worse.
So, you are not alone. This is happening all over the place.
Thanks for your comments Henry. Yes, this is happening everywhere. During economic crisis we see a lot ethical issues come up in all types of businesses.