The High Road: Brokers should blame themselves

When brokers act like the two I recently encountered and no one complains, we who sell real estate should expect our collective reputation to persist at a low level.

So do I occasionally write about certain unnamed brokers under the “High Road” heading (as well other questionable behavior).

Blogging about the incidents always has been enough at least to stem my anger and mitigate my contempt of bad brokers, even though I undoubtedly delude myself into thinking that my writing could lead to improvement.

Consequently, I don’t report bad behavior to the ethics committee of the Real Estate Board of New York (REBNY) , the Department of State (which regulates licensees) or executives of the firms that supervise sales personnel.  As I draft this post, however, I have yet to make a decision whether writing about a recent situation is sufficient.

It begins with an e-mail from my client,

Perfect pitch may hit the wrong chord of law

(Source: the U.S. National Archives)

The headline went like this:

“Can I Buy Your House, Pretty Please?”

In the Wall Street Journal, the article by Joann S. Lublin noted that the housing market has changed in some areas.  As the subheading observed:

With inventory tight and prices rising, buyers in competitive markets like Silicon Valley and Seattle are returning to a boom-era tactic: writing heartfelt letters to sellers explaining why they should win the house. Signing with a paw print.

The piece is accurate in pointing out that an emotionally charged letter from a buyer can sway a seller who is considering more than one offer.

Referring to the missives as “pitch letters” or “love letters,” Lublin correctly reported that

Brokers breaking law could face severe penalties

When I wrote about proposed new advertising rules for real estate brokers, I was unable to find specific penalties.

Now Whitney A. Clark of the Department of State has enlightened me with a response to my search for answers, and the good news is that virtually all violations of New York Real Property Law can produce the same costly punishments.

The High Road: ‘We have received several offers’

Take my offer, please! (Flickr photo by Kaptain Kobold)

Listing brokers and their clients like nothing more than receiving at least one offer.

Getting an acceptable offer can mean the end to open houses and diminishing anxieties about price, time on the market and that tired old kitchen.

Many brokers love to gin up the motivation of other prospective buyers by intoning the magic words, “We already have an offer.”  The hope, of course, is that providing the information will create buzz and generate even more offers, often better offers at or above the asking price with improved terms.

But

Can a broker submit offers for two buyers?

(Flickr photo by orangesparrow)

If a broker is representing a buyer, that broker has a fiduciary duty to that buyer.

What if a broker has two buyers who want to make offers on the same property?  Is it possible to fulfill a fiduciary duty to each of them?

Based on a ruling by an Ohio appeals court earlier this year, maybe not.

The case

State to tighten advertising rules for real estate

Few buyers and sellers of residential real estate believe everything in advertisements placed by brokers and agents.

Neither does New York’s Department of State (DOS), which is proposing to implement new rules as a consumer protection to replace its informal advertising guidelines.  In a notice about the change published on Oct. 24, it said:

After consulting with the New York State Board of Real Estate, however, it was determined that enforceable regulations were required in order to adequate protect the public from dishonest and misleading advertising practices.

Covered by the rule is

Thanks for sending that gift card, but. . .

How should I handle the gratitude another broker expressed to me not long ago.

I had referred to him a man who wanted to rent an apartment in Manhattan in the range of $4,000 a month.  It wasn’t the first such referral I had made to “Bruce,” but it was the first successful one.

There arrived in my mail a nice thank-you greeting card along with a $200 gift card for use in several restaurants.

The problem is

If it walks like a scam and talks like a scam. . .

When a proposal walks or talks like a scam, it ain’t a duck.

It’s a scam.

And scams rear their ugly heads all too often in the world of real estate.

Mortgage fraud won’t surprise you as one kind of scam.  In the good old days when lenders were all too happy to provide liar loans, few were the self-employed individuals and their lenders who didn’t inflate income.

Then there are the real estate brokers, lenders and appraisers who conspire

The High Road: Broker gets my goat

(Flickr photo by HeyThereSpaceman)

The apartment I went to check out took me 13 blocks from the previous open house on the Upper West Side and 14 from the next one on my itinerary a week ago Sunday.

When I arrived at the building, there was a note on its entrance to call the broker to see the place.  Common and fair enough.

Somebody already was on the phone, and I overheard him complaining to the individual on the other end

The High Road: Beware of pinball effect

One way to try and hoodwink buyers is for their broker representatives to provide a false reality check.

I hadn’t heard the phrase “pinballing” before reading in account of the tactic by Kenneth R. Harney in the Washington Post.  He defines it this way: