The Good Old Boy Network

In the real estate community it is a regular practice for an agent to call an agent with a listing and ask to be notified if any offers come in. Or they might ask are there any offers? There seems to be this thought that the listing agent owes the other agent "insider information".

The fact is that giving that information out can sometimes hurt the seller. Here is why; If the buyer knows there is another offer, they may take the position that they do not want to get into a bidding war, and so they do not make an offer and keep looking. Meanwhile the offer you had dies for one reason or aother. Or maybe it never gets accepted. So you call the other buyer and his agent says we already found another property and made an offer on it.

So if the listing agent simply says "The property is available" then the buyer might decide to make an offer. The fact that there is another offer means nothing. An offer is only an offer, and is not a deal. The property is available until there is a fully signed around purchase & sale agreement delivered to both buyer and seller.

Example: The listing agent and seller get offer number one. It is 20% below asking price with unpleasant terms. The agent tells the second buyer's agent that the property is available. Second buyer makes a better offer and the seller accepts it happily.

If the listing agent had told the buyer's agent that another offer was being considered, and the buyer went and bought something else, then the seller was harmed. And the agent's job is to do no harm.

Thus it is the listing agent's responsibility to discuss with the seller whether or not information about offers should be given out. And the agent needs to explain all the above to his/her seller so the seller can make their own decisions about what to divulge and when, knowing what the possible concequenses are.

Often I find other agents upset with me for refusing to divulge this kind of information or call them when another offer comes in. It is part of the "good old boy network rules" that you give this information out. In this, I choose not to participate in the good old boy network, and to represent the best interests of my sellers instead.

My first post ever to my Blog

Today marks the beginning of a new experiment in blogging with my new blog for making real estate less scary to the general public and people thinking about buying or selling real estate. I have no idea where this blog will go but am terribly excited to make a contribution to the Internet and public discourse on real estate.

Real estate ownership is the essence of the American Dream, and I am honored to be a part of the community of people who help make this dream possible for our fellow Americans in this greatest country on God's green earth.

Any who arrive here may post here as long as they are not abusive or negative. They may ask questions, answer questions, or give personal not legal opinions. My own opinions as expressed here are my personal opinions and not legal opinions. I am a real estate agent and Realtor, not an attorney.

My first opinion is about the direction of the real estate business in the 21st century. Very briefly, it is my opinion that the Internet, Virtual tours, and Staging as taught by Barb Schwarz of StagedHomes.com are the services that will set the 21st century Realtor apart from the old time agents who operated out of an MLS "book" and the seat of their pants. Open Houses are for getting buyers, not for selling homes. The agent of the future will find ways to multiply the exposure of their listings via the shrewd use of the Internet, and other creative ways to make their properties stand out from the crowd.

Thank you for checking in to my blog. Your comments are welcome!

David