Real Estate Agency Relationships Not Disclosed Early On

A recent post at the Los Angeles Times titled Real Estate agents; They aren’t all the same, real estate agency was not disclosed early in the process more times than not.

According to the Assn. of Realtors’ 2008 Profile of Home Buyers and Sellers, less than one-third of all buyers are told whom their agents represent at their first meeting. One in four others are told, but not until they make an offer on a house, and the rest are told “some other time” — if at all.

When you consider that the issue of agent representation can have a major effect on the price a buyer pays, that’s just unacceptable. Indeed, National Assn. of Realtors general counsel Laurie Janik has been quoted as saying that her members need to take their agency-disclosure requirements more seriously.

The article goes on to say the importance of a clear understanding of real estate agency relationships.

“Clear, consistent and transparent real estate agency disclosure will help consumers better understand that there are many types of real estate agents, each of whom have responsibilities to different parties,” Sullivan said. “Consumers need to have all the facts in hand in order to make informed decisions.”

Consider the following:

Most would-be buyers weren’t aware of that. Sometimes, lookers became so friendly with the agent who was helping them find a house that, in the course of their conversations, they disclosed important information the seller could use against them.

For example, if the would-be buyer wrote an offer for “x” but divulged that he could go as high as “y,” the agent had a duty to disclose that material fact to the seller. And knowing that the other side was willing to pay more, the seller could play hardball by sticking to his price or countering with a price he now knew the buyer would pay.

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