(Mark: Flickr photo by by Ben Fredericson)
Visiting the open house of an Upper West Side apartment listed at well over $1 million, I overheard a buyer asking whether the broker also was the owner.
After he responded in the affirmative, I looked closely at his marketing materials. To my surprise, there was no mention of his ownership.
When I got to my computer, I look at the listing in the Online Real Estate (OLR) database, and the information wasn’t there either.
That was not only surprising, but it was a clear breach of ethics. According to the Real Estate Board of New York’s (REBNY’s) Code of Ethics, members (of which the agent/owner is one) “shall not . . . undertake to provide professional services concerning a property where they have a present or contemplated interest unless such interest is specifically disclosed to all affected parties.”
Nor shall the brokerages. . .
engage in any transaction related to their real estate brokerage activities for themselves, any member of their immediate families, their firms or any member thereof or any entities in which they have any ownership interest, without making their true position known in writing to any party to the transaction.
While it is true that none of us was yet a party to the transaction, any of us at the open house may have been, as the Code specifies, an “affected party.” It is not beside the point that open house visitors ask a lot of questions and assess their interest depending on the responses.
Therefore, the measure is important to protect consumers: They have a right to know whether they are dealing with someone who has inside information beyond what a listing broker might normally have — for example, defects not immediately visible, the seller’s true bottom line, and the broker’s negotiating flexibility.
In other words, they deserve a level playing field and have a right to know that the unseen seller with whom they are dealing is a professional. The listing broker must not mask his dual role.
You may think I’m splitting hairs, but it is hard to argue that more disclosure isn’t always best for all concerned.
Tomorrow: Who’s who?
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Malcolm Carter
Licensed Associate Real Estate Broker
Senior Vice President
Charles Rutenberg Realty
127 E. 56th Street
New York, NY 10022
M: 347-886-0248
F: 347-438-3201
Malcolm@ServiceYouCanTrust.com
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