The Friday Rant: Can You Bully YOURSELF?

No, I don’t mean make fun of yourself, push yourself around, call yourself names, and maybe even do some physical harm.

I mean, “Can you bully your own real estate listing?”

If you’re holding back offers on a property you have listed, can you then submit a “bully offer” on behalf of your own buyer client?

Oh, it happens, believe it or not…

BullyYourself

There has GOT to be a rule against it.

But then again, when you’re playing a game that has very few rules, you can’t really critique the few rules you do have, can you?

How in the world can a listing agent be allowed to submit a bully offer on his or her own listing?

It just makes no sense to me.

Having said that, a very experienced and forthright agent told me earlier this week, “It’s my listing, I can do whatever the f*** I want with it, and there’s nobody who’s going to tell me otherwise.”

Perhaps.

But then why do we have the “Multiple Listing Service,” where the underlying theme is that we share listings, and cooperate with one another?

I’m not naive enough to suggest that a little bit of backroom-dealing doesn’t go on in organized real estate, or in basically any industry out there today.  But if you submitted a bully offer on your own listing, and sold it to your own buyer out from under dozens of other buyers then we don’t really “cooperate” with “cooperating agents,” do we?

Over the last few years, I’ve cast a light on many bad practices in the industry, but there are two of these practices that some brokers openly admit to:

1) Office Double-Enders, With Help!

When a brokerage has a listing for sale, that listing generates multiple offers, and that brokerage is representing a buyer with one of the offers, some brokers will come right out and say, “Of course I’m going to help my own agent, it’s our listing!  Why wouldn’t I?”

When we see the same companies “double-ending” their listings in multiple offers, over and over, we all know what’s really going on.  But several of these brokerages freely admit that they “push” their offer to the top of the pack, ie. they review eight offers, then “review” the 9th offer, which is their own, and add $2,000, and “win.”

2) Not Re-Listing Higher.

When a seller has his or her property listed for sale at $499,900, and turns down an offer of $505,000, that seller MUST re-list the property at $505,001, otherwise be guilty of false advertising.  One very well-known brokerage out there has told our brokerage multiple times, “I simply disagree,” and continues to advertise prices falsely.

Well as the topic of discussion today might suggest, I’d like to add a third “accepted bad practice” to the list:

3) Bullying Your Own Listing

I have a problem with the whole “bully offer” idea in the first place, which I’ve made clear on this blog a couple of times this year.

If you say you’re going to review offers on March 9th at 7:30pm, at the house, with the seller, and ask agents to please register their offers by 5:30pm at the latest, and be on time to present, then why sell the house on March 2nd?

Earlier in the spring, the bully offers were out of control.  You’d see two listings come out on a Tuesday, with offer apparently being reviewed the following Wednesday, but you knew you had to see them that night, since they could get a bully offer and sell out from under you.

Then you had all the novice (or lazy, carefree, and unafraid) listing agents accepting a bully offer but failing to inform other agents who had shown the property that there was a registered offer!

It was absolute mayhem, and I hated every minute of it.

But what if you were to combine #1 and #3 on this list?

Take two bad real estate practices, and turn them into one?

So here’s the situation:

Bob the listing agent puts out 123 Fake Street on Thursday, July 3rd, at $799,900.

Offers are scheduled to be reviewed on Wednesday, July 9th at 7:00pm, at the listing brokerage.

On Thursday and Friday, there are 25 showings from “cooperating agents,” and a lot of agents email Bob and ask for the home inspection, ask what the sellers’ preferred closing date is, and tell Bob to “keep them in the loop.”

On Saturday morning, Bob shows the house to a client of his own, and the client says, “I want to buy this house, let me know what it will take, and I’ll pay it.”

Bob then drafts an offer for $910,000, brings it to his sellers, and the seller accepts.

Bob changes the MLS listing to reflect the property is no longer “available” and now “sold,” and reports the $910,000 sale price.

Is that okay with you?

Because it is NOT okay with me.

And the worst part is: there’s nothing in the two-page virtual “organized real estate rule book” to prevent Bob from doing that.

Oh I’m sure there’s a rule a, and a rule b, and a rule c, all of which might loosely apply.

But there’s nothing specifically relevant to this situation under REBBA, 2002, and there’s no real repercussions for Bob.

Bob doesn’t really have to answer to anybody, either.  When Bob gets calls from “cooperating agents,” who ask, “What happened to the July 9th offer date?  Why didn’t you call me?  I told you to keep me in the loop!  My buyers are pissed!”  All Bob has to do is say, “My seller elected to look at the offer, and subsequently he accepted it.  He was not interested in attempting to solicit other offers.”

And that’s that.

So f*** everybody then?

Is that the takeaway from this story?  Should agents just do as they please, and damn the consequences?

I know dozens, or perhaps a couple hundred really impressive, professional, friendly, and honest Realtors that I tell at the end of a transaction, “I really, really enjoyed working with you, and I mean that.”

And then, there’s about 35,000 others…

It’s getting slimy out there, folks.  And the discount brokerages, which a small percentage of the population thinks is helping to offer “alternative business models,” are watering down the industry to the point where a monkey at the zoo could do a better job.

To be fair, I did say that a couple of well-known brokerages are guilty of items #2 and #3 on my list of accepted bad practices, but I’m seeing a lot of inexperienced and/or agents who are desperate to put food on the table and stay afloat in this business who are cutting corners and pulling off some shady moves.

Double-ending your own listing via bully offer, before the scheduled and posted offer date, when there’s a public open house on Saturday & Sunday, and when there have been 25 showings booked through your office, and two home inspections conducted by interested buyers, is NOT okay.

I simply refuse to accept otherwise.

16 Comments

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  1. World's Gone Crazy says:

    Awesome post @Amelia! Can’t even add anything else cause you said it all!

  2. Chroscklh says:

    When I move Canada, I get confuse – in my country, bully offer means u get shove to ground and offer pushed in mouth. Here it called bully offer but submit with “please” and “thank you.” what is meaning?

  3. Amelia says:

    I love it when people complain about real estate agents. Like fish at a poker table. Just screaming to be taken to the cleaners. Boo hoo … life isn’t fair. And real estate sales isn’t retail! It has always been the wild west. ALWAYS. Don’t bring a knife to a gun fight. You will lose every time.

    Your agent needs to be able to work with scummy people and come out clean on the other side – to your advantage! That’s what makes a realtor exceptionally good or not. If you hire scum – your fault. If you hire stupid – your fault. If you hire unethical – your fault. If you hire naïve – your fault. If you hire inexperienced – your fault. If you hire a criminal – your f’ing fault!!

    No regulator is going to make this profession fair. And it is a PROFESSION. Realtors are entrepreneurs that you contract to serve you. The consumer is 100% responsible for the choices they make. You’ve got more choice now than ever before. So why are you still blaming the agent? Stop hiring agents that don’t serve your interests. Simple as that. And for goodness sake, learn your rights. There are oodles of protections out there for the consumer of real estate services. Have you read REBBA? No?! Ok. Get on that. Stat.

    All you whiners are like women who date jerks and then complain that there are no good men out there. Yes there are! So many it’s laughable. A good agent is priceless and there are a many good ones. You just choose not to work with the good ones and then want some regulatory body to give you justice when it doesn’t work out. An ounce of prevention is worth a pound of cure. Man … I’m really churning out the idioms today. lol

    In the case that you are totally swindled by a fraud – get a lawyer – and preferably one you don’t choose yourself because you’ve already demonstrated that you can’t be trusted to serve your own best interests! Give me one example of a profession where there aren’t fraudsters! Give me one example of a profession where the consumer is protected from their own ignorance?

    /endrant

    1. Curious says:

      I love You! That was an awesome analogy, way to put it.

    2. JC says:

      Brava!

      I do agree with David that there are a large number of slime-balls working in this industry. It’s the part that bothers me so much about it – so much so that I’m working my way out. Professional courtesy means nothing to those that are rude and unprofessional. Throw greed in there and you’re fighting an uphill battle. Heck, my own Broker screwed me over once for work I did while he was away on vacation. My bad, I should have had an agreement in writing – lesson learned!

      So many industries are in a race to the bottom, and everyone wants as much as possible for the lowest price.

      More often than not, you get what you pay for.

      Millions of people shop at Walmart, buying cheap, made-in-China crap, because “the prices are so good!” and then wonder why there are so few manufacturing jobs in North America anymore. AND get mad at Walmart for selling cheaply made things when those bargains break after a week of use.

      Same goes for Realtors. “I’m not paying 5%. A guy from the Ernest E Smengy Brokerage will do it for 1%.” Then they get upset when that 1% was just the listing side and it was really 3.0% or more, and “they never helped, they yada yada yada”. If anyone suggests they take them to court, the first thing out of their mouths is “do you know a Lawyer that works cheap?”

      Too often I see people who refuse to pay commission to listing agents (and thus, buying agents) and then wonder why their house won’t sell. Or you give them advice, and because they watched an hour of HGTV or their second cousins boyfriends’ ex-wife watched a documentary on something on US TV, they completely ignore all of your advice and refuse to do what you suggest to sell their home as quickly as possible. Then its YOUR fault because the house didn’t sell. Ok, part of this may be the Realtors fault – not many Realtors I know will flat out refuse a listing.

      The fact that they wasted precious listing time going exclusive because they didn’t want the whole world knowing they were selling (?!), then increasing the list price when that failed (to make up for increased commissions), and all the while, refusing to fix known problems that several different home inspectors brought up – killing every single deal… yeah, that was the Realtors fault. (Not my clients… I refused the listing and have been watching from the sidelines)

      Someone upthread asked what the point was of licensing Realtors. Because it’s an industry and if Realtors weren’t licensed, all those groups that have their fingers in the pie (OREA, CREA, etc wouldn’t be getting the $ they get every year from every Realtor as part of “dues”.

  4. GinaTO says:

    David, comment unrelated to this post, but about your “roommate” Pick 5: 700 King W is actually not suited for roommates: both bedrooms are inside bedrooms, and the walls do not go all the way up to the ceiling – it’s that loft thing were there is about a one-foot opening between wall and ceiling. So, when it comes to… sneezing… noises, that would be worse than side-by-side bedrooms, don’t you think? 😉

  5. R says:

    Wow. $10,000 fine but the agent still nets $14,000 commission after paying the the fine. And you wonder why the profession is filled with cheats and liers?

    The real estate game has no respect because it deserves none. Nobody “wants” to be a real estate agent when they grow up. It’s a back up career for everyone. Like security guards. The governing body has only it’s own interests in mind, not the people they serve. Just listen to any “get a realtor(tm)” ad. They think the public are idiots.

    I’ve been luck to have no personal bad experiences in real estate, but have heard plenty of bad ones both here on TRB and in person.

    I just wonder why licensed real estate agents even exist. You don’t have to be licensed to sell a car, a chair, a burger, why is real estate different? If we opened up the “profession” to the real free market I’m sure we’d quickly see everyone jumping in, but an eventual huge seperation from the amateur to the real pro…not to mention something better than MLS.

  6. Adam says:

    I wish I’d known that then, I was livid.

  7. Joe Q. says:

    Some time ago I posted a link (in comments to another article) about an agent who bullied his own listing without informing other agents who had expressed interest. The case ended up in a RECO tribunal and the agent was fined. I will try to dig up the link.

    1. Joe Q. says:

      Here we go: Agent bullies own listing, fails to update MLS or contact other interested agents, is taken to RECO tribunal by one other interested agent and is fined $10,000. The citation indicates that RECO found him guilty of not representing the best interests of his client, or some such.

      http://www.reco.on.ca/publicdocs/20121113_201100042.pdf

      1. ScottyP says:

        $10,000 is nothing. Yet another case of a RECO hand-slap.

        1. Kyle says:

          What gets me, is why are they protecting this guy’s identity? What is with this Brokerage A and Brokerage B garbage? RECO should flat out identify exactly which brokerage and city he works for, so that 1. Consumers know not to trust him and 2. Other honest Realtors who may happen to have the same name don’t get confused for this scammer.

  8. Adam says:

    When I used to be a Realtor I fell victim to #3. I called an agent and said I wanted to submit an offer on an apartment. He repeatedly told me that they were absolutely not accepting offers until a certain date. I should have just sent it to his broker but I was a little green then. I also told him we were going to submit at $3.2M. The following morning, and 4 days before submission date, it was sold by him for $3.1M. He was definitely not serving his clients best interests at all. I still track the MLS daily as I now work in another facet of commercial real estate. I see his listings pop up all the time with the same routine. surprise, surprise, you double ended another listing before the submission date.

  9. Kyle says:

    I find #1 really interesting, and i don’t think you’ve really written about it that much. I’ve always wondered about how much “inside information” is shared amongst agents within a brokerage, whether it be something relatively harmless, like letting agents in your office know of an upcoming listing before it hits the market, or something not so harmless like giving away how much a seller would be willing to accept or how much other buyers have offered.

    As far as agents bullying their own deal, i only see a problem with it if the listing agent is putting his own interest above the seller’s (i.e. if the agent could have gotten his client more by calling other interested parties to the table but failed to do so, because that could risk him not double-ending). Frankly i couldn’t care less about the feelings of buyers (and their agents) who didn’t move fast enough. To me those are not real arguments against bullying your own deal, those are simply gripes by people who aren’t accepting or responsive to current market conditions.

  10. Long Time Realtor says:

    Dear me David. Would you like some cheese with that whine?

    Here’s my suggestion. When you come across a “hot” new listing, I urge you to show it to your clients ASAP and prepare them to submit a bully offer of their own.

    In this market you can either be one of 25 agents presenting on offer day (odds are that you’ll lose out on the deal anyway), or bully your way to the top and make it happen for your clients.

    Don’t blame the listing agent for not playing nice. He / she doesn’t owe you or your clients anything.

    Nothing personal, it’s just business.

    1. @ LTR

      That’s fine, I deserve it. My piece was rather whiny…

      I’ve submitted bully offers of my own this year, and come to the conclusion that they are useless. But then I see properties selling via bully, so it makes it all the more confusing.

      Either way, I’d just like a set identifiable rules, that’s all. Then we KNOW what to expect.

      I don’t blame the agents for not playing nice, but I do blame them for looking after their own pocketbook first. I can speak from experience and say that if you treat your own clients, and fellow agents, with respect and courtesy, it will come back to you tenfold in the end. The corner-cutters might make extra money today, but they’ll be out of the business down the road.

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