The low inventory housing market is creating a beast . . .
This beast is not always recognizable at first glance – A wolf in sheep’s clothing.
Unfortunately, (sadly) this beast looks, talks, and acts like most of us real estate sales professionals, but has a deep and dark ulterior motive . . . Which is, at the core, not more glamorous than GREED.
This GREED creates a THIRST which can only be quenched by selling more houses even it means compromising legal and/or ethical meanderings.
The “sheep” in this draconian tale are unsuspecting Home Buyers and Sellers who, in their naivety, fall prey to these predators as they find themselves reaching near desperation in search of a house.
Often, their enigma centers around the uncomfortable reality that they MUST sell their current home in order (financially) to be able to purchase the next house . . . and they know that if they were to put their current house for sale in this near-zero-inventory market, it would likely sell quickly . . . BUT finding the next house may bear trials and tribulations that have potential to overwhelm even the most stalwart – Frustrating Multiple Offer Scenarios, Unreasonable Sellers asking exorbitant prices and/or refusing to make much needed repairs, and mortgage lenders who sometimes make even the strongest buyers feel like alleged criminals as they wade through the sludge of loan underwriting.
Given all of these challenges, many of these Home buyers will stray from the flock and begin to look for a house in less conventional manners . . . alone and without the “protection” of their Exclusive Buyer Agent.
THESE are the Buyers the aforementioned beasts single out and capitalize on their physical, Mental, and emotional fatigue.
Ostensibly, the “beast” is a Real Estate Licensee who represents the Seller of a home (the Listing agent) . . . Either a resale, or (more probably) a new construction representative selling “Custom Builds” or existing speculative inventory. These listing agents have tremendous leverage because they have the only see-able inventory.
They offer HOPE!
They offer SOLUTIONS!
Their houses are NEW and SHINY, and the Buyer will be able to CHOOSE many of the finishes and features (Colors, Materials, Fixtures, Etc) and might even be able to select the lot.
This is SO exciting for the Buyer . . . a BRILLIANT ray of SUNSHINE in this world of house hunting desolation.
Predators LOVE vulnerable prey.
In this case, the “vulnerable prey” is the Buyer who stumbles into the beast’s lair without their Exclusive Buyer Representative.
Even after the Buyer has announced an agency relationship with an exclusive buyer’s agent, The Beast might:
- engage a high pressure sales tactic to coax the Buyer into signing something (A contract)
- Convince the Buyer to pay an unreasonably high “NONREFUNDABLE Earnest Money deposit” because of the need to sell the current home
- Tell the buyer that the builder will not agree to a Home sale contingency UNLESS the buyer lists the home with the Builder’s agent.
- Tell the Buyer the price will be lower if their agent is not involved in the deal
- I’m sure other REALTORS could sing along at this point and add their own stories.
These practices are NOT typical of Builder’s agents and other Listing agents, but they ALL ARE happening in my market, and I am certain virtually every other market . . . and they are WRONG!
When one of my clients slips into said lair, I’m VERY quick to growl and bark:
“HEY! That’s MY Client you’re messin’ with!”
There are potential multiple legal and ethical violations not to mention the damage to the reputation of all real estate professionals. the Buyers (Non-REALTORs) often emerge from these experiences having learned not to trust REALTORS.
In the beginning of this post, I called these “Wolves” “BEASTS” . . . That’s a strong statement, and I stand by it. These people are out there wreaking havoc on the reputation of our entire industry of professionals while the rest of us tirelessly uphold our fiduciary duties and ethical standards.
To all you Home Buyers and Sellers out there
MOST (but not all) Real Estate Sales Professionals will serve you legally and ethically . . . some are beasts . . . Your Home Buying and Selling experience will go MUCH smoother if you “arm Yourself” by engaging in an exclusive relationship with a REALTOR you know and trust before embarking on your journey.
There will be times of frustration due to market conditions . . . Don’t blame these on your REALTOR . . . Don’t stray from the flock.
PS . . . I am NOT making any of this up . . . I have witnessed every bit of it in my market in the past month . . . and I see more of it on the horizon.