I love open houses. It’s where buyers come through and detox, all over me. And that’s fine, because then I can tell them how to avoid making the same mistake twice. For instance, Susie and Joe, who bought their last home directly from the listing agent.
“Man, did we get !@#$%ed over,” they said. Here’s what they found out after moving in:
- They might have paid less. (“What?! We should have been shown comparable sales?!”)
- They weren’t told the implications of the lot’s slope. (“They gave us a geological report and the house wasn’t in a flood zone.”)
- They didn’t know there was a drug dealer down the street. He lived in a very nice house with his mother and didn’t have a “Drug Store” sign hanging in the window, but it was common knowledge. (“Really, you would have taken us door-to-door and asked the neighbors if there were any issues?”)
And why didn’t they discover all this before closing escrow? Well…because…even though the listing agent has a fiduciary duty of “honest and fair dealing and good faith” to both the buyer and the seller,* there are some things that neither a listing nor a selling agent is actually, verbatim, legally, required to do. And realistically (speaking from my observation deck in the real world)—who became the listing agent’s BFF first? (And paid his commission?)
A strictly buyer’s agent is held to a higher standard of fiduciary duty to the buyer. He’s supposed to think (think), “What could go wrong, and how should I advise my client about it?”
But, you say, “The listing agent told us that if we had her represent us the seller would be more inclined to accept our offer.” And this was the house of their dreams, and, and, and.
Here’s how you score the touchdown. A listing agent is required by law to present ALL offers to the seller. So you just run right over to your own agent, have him write up the offer and email it to the listing agent (with a receipt for delivery). Yes, it will highly annoy the listing agent because she will have to at least tell her client that she has your offer and (should she forget her fiduciary duty to both parties) convince her client that your offer is Not Good, and that they should hang around waiting for her to produce a better one.
If you lose the skirmish and someone else gets the house, take heart in knowing that over half the lawsuits in California result from the listing agent representing both sides in a transaction. It’s called dual agency, and it is Very Bad.
Know that you were spared. And that good things come to those who wait.
If this is confusing, or you want to debate, or you just want to vent, feel free to comment below or email me at firstname.lastname@example.org and put “Blog” in the subject line. I care.
*California Civil Code
Cathy Turney has been a licensed California real estate broker (#01056789) since 1988, state-certified appraiser (#AR008672, emeritus), and wrote the American Business Association Stevie Award winning book, Laugh Your Way to Real Estate Sales Success.