I remember my days and nights as a real estate instructor and the lengthy discussions about taking overpriced listings. Florida Realtors are members of the National Association of Realtors, and therefore are required under Article 2 of the Code of Ethics to refrain from exaggeration, misrepresentation or concealment of pertinent facts related to property or transactions. I believe that overpriced listings fall within the parameters of Article 2.
When you combine the ethics requirements with the license law - Chapter 475, Florida Statutes, overpriced listings could be construed as misrepresentation, in fact, material misrepresentation. Surprisingly, it seems some associations of Realtors tend to turn the cheek the other way regarding this issue. And since I am out of the legal loop, I cannot comment about any prior or pending cases involving this type of misrepresentation.
There appears to be some unwritten doctrine among Realtors, that if they cannot get the property priced correctly during a listing appointment, someone else will come in behind them and take the listing anyway. Unfortunately, this happens more often than not. If everyone in this business were truly professional, this would be a moot discussion. Perhaps the disciplinary boards should revisit these violations and impose substantial sanctions to deter Realtors from being so reckless. Walking out without the listing exudes confidence, self-respect, and true professionalism.
If we demonstrated more professionalism and took a firmer stand on what is right, I believe the problem would go away. To take listings for the sake of taking listings does nothing but stroke egos without regard for the best interest of the customer. Taking a listing for the sake of getting your sign on the property is nothing more than instant gratification. All that is accomplished by taking overpriced listings is helping to sell the rest of the inventory in the neighborhood. And if they believe by some miracle the property will sell at that high price, they are delusional.
How do you explain to the seller 30, 60, or 90 days into the listing that the price has to be reduced? As the professional, you told the seller that you believed the property would sell somewhere near the asking price, and now you are retracting your own assessment. Pricing property to cause it to sell in a reasonable amount of time is not rocket science. When I see listings that have been on the market beyond 365 days, it is disturbing.
Wouldn't it be wonderful to explain to the seller that you are prohibited by law and a strong code of ethics from overpricing their property?
Mario D'Artagnan is a broker associate at Para-dise Realty, specializing in domestic and European clientele. He is a former investigator for the Florida Real Estate Commission. He is also a former real estate instructor. He is a published author and has been a keynote speaker on the subject of agency law. Mario is also a veteran of the U.S. Air Force. For questions or comments contact him at: email@example.com or call 239-565-4445.