I had an unnerving experience this week. I registered an offer on a property. My buyer was very motivated to buy the property
tried to get a commitment from her to present the offer in person as soon as possible but she had a gaggle of reasons why this couldn’t happen. Anyway, long story short, the listing agent brought in her own offer and double ended the deal. The price was lower than what my client was offering and he was furious. He thinks the real estate industry is unethical, greedy and unprofessional. How could I have avoided this?and was making an excellent offer. When I spoke with the listing agent, she was vague about timelines and about the process. I
I hate hearing stories like this. When listing agents do this it makes us all look like buffoons.
Likely she reduced her commission so that the net to the seller was the same or possibly higher than your buyers offer. She must communicate this to you and give you a chance to adjust your offer. If she didn’t, which seems like the case here, this contravenes the CREA Code of Ethics which states, “As REALTORS®, we are committed to Cooperation with and fairness to all. It also contravenes the Ontario Regulations, Section 25 (1) where you are practicing. (See below)
I don’t think it’s fair to reduce commission on an MLS listing if there are multiple offers. It gives a significant benefit to one party over another. I have always been firm on this point with my previous sellers because if I was seen as unfair by the other agents, it would have a negative effect on my ability to attract offers to my sellers’ properties. In addition, it erodes our reputation as REALTORS® and undermines our ability to represent the consumer as professionals.
You need to know your rules and regulations well enough to have the confidence to speak out when an agent is in contravention with them and it is disadvantaging your client. It is your responsibility to protect your client. Agents will push the edge of the rules. That is part of our business but each of us needs to know the rules well enough to call it when someone goes over the edge. Know and study your CREA Code of Ethics and your provincial legislation and let’s make Real Estate more professional!
Ontario Regulations 580/05 Section 25 (1): If a brokerage has a seller as a client and an agreement between the brokerage and the seller contains terms that relate to a commission or other remuneration and that may affect whether an offer to buy is accepted, the brokerage shall disclose the existence of and the details of those terms to any person who makes a written offer to buy, at the earliest practicable opportunity and before any offer is accepted.