Pocket Listings Vs. Exclusive Agency…with held from MLS.
What is the difference and when should you choose to represent either one?
Here is the dilemma we will all face at one time or another in our agency forms, requirements, and the ethical decisions we will make related to our clients and the other local Realtors we engage in our market place.
Choosing an Exclusive agency over an Exclusive listing agreement.
Giving up the possibility to collect on your hard work and efforts to market a property, when the seller retains the right to sell to a party self generated. No one likes this agreement and will avoid entering into one like the plague. But from time to time a seller will say he/she has given a family member or an abutter the right to purchase if ever the property comes to market (not a recorded first right of refusal..a hand shake).
If you don’t place this listing in the MLS, your colleagues will accuse you of taking a pocket listing and keeping it for yourself. But if you publish the property and everyone wants to show it…get disclosures…deeds…right of ways…review zoning laws…check the title or any number of things, and then the seller’s inside guy steps up, you are an S.O.B. The up side of publishing the listing is it creates activity…and defines the fee being offered. Our fiduciary duty to the client is to produce the highest and best offer; competition will clearly offer a higher likelihood of better offers. And in my experience produce a price that even after commissions will be a higher net that the sellers hand shake among family members. But what of the promise to sell to Cousin Connie or Auntie Anna too bad so sad not enough cash? Does more money trump the abutter that purchased his site from you years ago and expected to own it all when you were ready? Or the relative that would other wise have no shot at ownership without the family discount?
I will come up with my market value, and ask the seller for the names of those (few) that will be considered “procured through the sellers sole efforts”, and make it known anyone outside of this list no matter the relationship…will be fair game.
1) Take the E.A. agreement…and keep it off MLS
2) Take the E.A. agreement …and put it on MLS
3) Refuse the listing agreement, due to the possibility of work with little pay.
4) Insist on an Exclusive right agreement and make all buyers equal no matter if they are friend or foe to the seller.
Not an option taking the listing and having the private sale comes with no compensation for my firm. In past agreements, we have done the paperwork for the sellers “procured customer” for a significantly reduced fee, and acted as a buyer facilitator to ensure the proper paper work was done, as protection for the seller.
1.Take the listing?
2.Do the CMA so the seller can use you?
3.Expect all sellers to be honorable in their intentions?
4.Pocket the listing?
5.Put it in MLS and let the chips fall where they may?
One last questions...does it matter if the property was a unique waterfront piece?
Who Would be interested in a pocked listing...with no published commission split?