Real estate agent tactic legal or not

[jack2016]

Hi I thought of a couple of scenarios for a while and was wondering if it is done and if it is legal. I presume at least one of them is legal.

1. -a By negotiation; - b Deadline sale or tender: after receiving all offers, agent picks 2-3 people, rings them up and say to them hey you are about to miss out, could you modify your offer eg more money or less conditions, then A, B, C comes back with more.

2. Agent doesn't stop there after getting back revised offers, goes again and does the same and gets more and so on ...

[Nick G]

Theoretically no...

1a. I think you're describing a multi-offer situation. If we have two buyers for example, we give them a 24 hr deadline to present their best offer. It doesn't become an open auction where people see what the other side is bidding. The vendor can refuse the offers still and make a counter etc.

1b. Offers are placed in a closed envelope and delivered together. Many selling agents could be bringing in offers and they won't disclose them because they don't want the other agents to tip their buyers. I've missed out on tenders and the agent couldn't even say by how much.

2. If the vendor does not accept any of the offers the agent/s are then free to ask for new offers, they cannot disclose what anyone else has on the table. It happens quite frequently when an auction or tender fails to sell. In practice the top offer gets first crack at negotiation.

More on 1b, it can get pretty brutal. We had a buyer lining up a bid for a deadline, our selling agent had been told deadline was noon on Monday. On Saturday we drove past the listing and it had a sign on it. He had been lied to by the listing agent in order to get the full commission. In theory we (our client) could have lodged a complaint but we left that with our selling agent to, if he wanted. It was quite embarrassing for him.

[jack2016]

Wow didn't realise it's agent vs agent as well.

Ok good to know, I've heard of a top agent around here doing 1a, ie disclosing the highest offer in a multi offer situation and then going back and forth between A and B like an auction. I cannot verify so let's assume in good faith he didn't. But if he happens to do it on me I'll know what to tell him.

[Nick G]

I think it depends on agency policy (although I could be wrong). When you go into a multi you should be given a 1-pager to sign that lays out the situation and gets your signed acknowledgement. For example, ours includes in a lengthy list of items under "I acknowledge that"...

That the vendor has the right to counter offer and/or negotiate with one prospective purchaser to the exclusion of other purchasers

and

That I/we might not have any further opportunity to submit a higher or better offer to the vendor

and

That the terms and conditions of my/our offer will remain confidential to me/us, the salesperson drafting the offer, and management. The offer will be presented to the vendor directly

If you are being egged on to up your number because a higher offer is on the table ask to see their multi-offer policy. They have no right or obligation to show you other offers so that certainly sounds like dubious behaviour.

[Nick G]

As for agent vs agent - in most vendor agencies commission is split between the listing agent and selling agent. Agents will maintain their own buyers lists.

If you list a property, you get your name on the advertising, however any agent in your office (or in Barfoots case, in Auckland) can solicit offers from buyers.

[jack2016]

understood, but didn't realise the competitive behaviour between agents, but then I never paid attention to that before

[Davo36]

understood, but didn't realise the competitive behaviour between agents, but then I never paid attention to that before

Yep it's between agenices and between agents in the same office. It's their livelihood.

Can get quite 'animated' between sales staff at times.

NickG, this paragraph makes no sense to me, not sure what you're trying to convey, can you expand on this?

More on 1b, it can get pretty brutal. We had a buyer lining up a bid for a deadline, our selling agent had been told deadline was noon on Monday. On Saturday we drove past the listing and it had a sign on it. He had been lied to by the listing agent in order to get the full commission. In theory we (our client) could have lodged a complaint but we left that with our selling agent to, if he wanted. It was quite embarrassing for him.

[jack2016]

Deadline was brought forward by agent A without telling anyone (agent B).

[Bobsyouruncle]

If agent A was listing agent then bad behaviour but not breaching any rules?

[jack2016]

Especially if it's "Deadline sale unless sold prior"

[jack2016]

But definitely working for himself rather than the client. Although the buyer would have no complains!

[Davo36]

Oh say he was saying the listing agent lied to the selling agent about the deadline, so the selling agent missed out on getting his offer in?

If that actually happened, then the listing agent should be fired by the agency.

[Nick G]

It was after an auction passed in. The listing agent was in my opinion in breach of the act because he deliberately misled others in order to prevent competing offers, which goes against his fiduciary duty to his client.

[Davo36]

It was after an auction passed in. The listing agent was in my opinion in breach of the act because he deliberately misled others in order to prevent competing offers, which goes against his fiduciary duty to his client.

Yep, if he did that, it definitely goes against the fiduciaty duty to his client. And he should actually go before the REAA for that.

I used to be an agent and hate this sort of thing when it happens.

[jack2016]

As for my scenario I had a very conversation with a vague colleague who thought her agent did "1-a" ... and she thought that was a bit sneaky. He is a top agent by "total sales ever" around, so ... hmm ...