- “Coming Soon” sign riders and advertisement increase in number. In this kind of market, some real estate sales people do this with the hope that they will be able to sell it directly to an unrepresented buyer and thereby not have to “Cooperate” with another agent (and thus not have to share the commission).
- Cliques of agents form. They share listings only amongst themselves, so other REALTORS and the general public never know the houses are available until they show up on MLS “Pending.” This is an “I’ll scratch your back if you’ll scratch my back” arrangement that may seem innocent enough, but can lead to some unsavory practices.
- Developers and their agents may form their own “Cartels” – A veritable army of people who might focus on one AO (Area of Operation) that is particularly ripe for development/gentrification. These folks will work door-to-door to convince home owners to sell NOW to these FAST, CASH, NO HASSLE buyers. Again on the surface, this looks benign . . . but are they paying “Market Price?”
- Internet trolling – This does not apply to most agents out there . . . but BEWARE! Some unscrupulous agents will post “Phantom Listings” on internet sites (Trulia and Zillow) with the sole purpose of capturing leads with “Bait and Switch” . . . “THAT house is no longer available, but I can help you find another!”
- For Sale By Owner – “listings” are on the increase often fueled by the Siren call of inaccurate Zestimates. Home owners who believe that if it’s on the internet, it must be true can find plenty of justification for inflated pricing for their house . . . Which they paradoxically “List By Owner” . . . and then wonder why they can’t get it sold.
REALLY? There’s a real estate “Black Market?”
There are some interesting things going on which (I believe) compromise the Seller’s best interest for the benefit of Developers, Builders and REALTORS.
When the housing inventory gets low, the Black Market THRIVES.
For some, this is a good and lucrative thing . . . For others, NOT!
Here are some kernels to consider:
I’m sure this Real Estate Black market is manifesting in other ways that I could not even dream in my wildest dreams . . . It’s the kind of thing that happens when the inventory gets tight and Buyer DEMAND is on the rise (descriptive of the housing market here in Middle Tennessee).
I am, in no way, bashing real estate sales professionals because most of the participants are primarily guilty of failing to think things through before taking action.
Having said all of the above, there’s a common denominator worth noting:
In all of the above scenarios, none of the houses/sellers have the benefit of being exposed to the OPEN Marketplace before selling.
I wonder how many tens (or hundreds) of Thousands of dollars are unclaimed by naive and unsuspecting Home Sellers?
We’ll never know the real statistic and real impact, but that doesn’t mean we have to endorse this Black Market.
This kind of “Limited/Exclusive marketing” has huge potential for Sellers selling their houses “short” (for less money than being exposed to full open market).
These practices frustrate Buyers and are are close cousins to “Self-Dealing” at the expense of the Seller.
Wrong in so many ways.
I’m not expecting this post to popular among Real Estate Sales Professionals, but I think it needs to be said.
Play fair and don’t forgot whom you REALLY represent.