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  • San Diego, CA 92131
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“Are you working with an agent?”

To say that our local real estate market has been active lately is an understatement. We’ve taken a little trip to Crazy Town, that place where too few homes for sale and too many buyers collide — more often than not, in a deafening crescendo of multiple offers.

In Crazy Town, listing agents find themselves spending a sizeable slice of each day manning the phone banks.  From the moment we hit “submit” on any new property that is reasonably presented and priced, we start getting the calls from civilians and other agents alike. A listing agent is suddenly the most popular girl in town.

These calls all begin in much the same way. Before I can truly engage the caller in meaningful dialogue – before I can answer his questions about Homeowners’ fees, granite counter tops, and how much I stand to make and will I give him some of it – I need to know who it is I am talking to.

The first problem is that most of these calls come through our main office line. While I love our receptionist and she generally excels at redirecting calls, she is not a real estate agent. She still doesn’t quite know what we do or the right questions to ask. Consequently, each caller is introduced to me as “a potential new client.” It could be an appraiser, a termite inspector, one of our own agents, or my doctor calling to schedule that little bypass. They are all “potential new clients.” So I must first do some vetting.

Is this the party to whom I’m speaking?

Usually, the call begins like this.

“I am calling about your listing.” (Silence)

“Which listing?” I ask. Because, you see, we usually have more than one listing at a given moment. And while I am quite intuitive at times, I admittedly have yet to master utter clairvoyance.

Several minutes later, having together successfully mapped the home in question (“You know, the green one by that other street, I can’t remember the name, but it ends with ‘Road’”), we are finally getting somewhere. But I still have to dispense with one more bit of business.

“Are you an agent?” I ask sheepishly.

Perhaps because we have become accustomed to communicating in 140-character sound bites, it is rare when a caller introduces themselves by name, let alone job classification. This includes my colleagues.

Why does it matter? Well, if I am speaking with an agent, the conversation would necessarily move in a slightly different direction, since I really don’t care if they dream of having a pool some day — or have been preapproved for a loan.

So, you aren’t an agent. Are you working with one?

“Are you working with an agent?” we ask next.  That seems like a simple enough question, but it is one that is usually met with so many stutters and stammers that you would think I just asked them to explain the theory of relativity in Swahili. And usually, once they have regained their composure, the answer is “No.”

“No,” I have learned, can mean many things, including but not limited to:

  1. No.
  2. No, I am not working with an agent right now. Right now, I am eating a bowl of Grape Nuts and talking to you. I haven’t been working with an agent since this morning when my agent showed me twelve homes.
  3. No, I am not working with an agent right now. My agent is (on vacation, sitting an open house, not returning my calls, in traction) but I really want to see this house right now and it has to be right now because I am a busy, busy guy. Just open the darn door, already.
  4. No, I am not working with an agent per se. I will work with an agent when I find the house I want to buy, but only if that agent is the listing agent because I think I can cut a deal and I don’t need no stinking agent anyway.

Now, first let me go on record as saying the reason for my question is NOT ABOUT DUAL AGENCY. Yes, I just screamed. It’s not about dual agency. While I do not happen to subscribe to the theory that dual agency is the root of all evil, it is not something we seek out nor do we prefer it. Rather, the reason for my question has to do with the way agents work and are ultimately compensated.

The Offer of Compensation

When an agent takes a listing, the listing contract specifies a commission and how much of that commission will be shared with another broker in the event it is another agent that represents the buyer in a successful closing. When a listing is entered in our Sandicor Multiple Listing Service (MLS), the listing agent is making a “blanket unilateral contractual offer of compensation to the other MLS broker participants for their services in selling the property.”

If you are “working with an agent,” then, there is the expectation that your agent will perform certain agent-ish duties – like showing you the home, explaining the contracts, providing you with market data, and negotiating and closing your sale.

Notice I included showing the home among the list of buyer agent duties. “But as the listing agent, you owe it to your seller to promote the property and get people through!” you might challenge. Yes, I do indeed. I am happy to – I WANT to – take buyer calls, because I know more about this home than anyone else, and I am best prepared to answer questions and sell-sell-sell. But when a buyer is working with another agent, it is their agent who should be opening that door. Sorry. I know that sounds harsh.

Caveat emptor: On many, many occasions I have accommodated a represented buyer’s request for a showing. But on these occasions, I did so because either the agent begged for an assist (“I’m in traction!”), or because the agent was otherwise unavailable and there was a sense of urgency (like multiple offers on the table). We take our duties to our selling clients very seriously, and we want all interested buyers to have the opportunity to get it while the getting’s good, because this is in our client’s best interest.

The point is, be honest. It’s OK. We are not mean or lazy. In fact, we are quite reasonable people. But it is not unreasonable for you to expect your agent to do their job.

The Code of Ethics and Professional Courtesy

There is also a little matter of ethics. From the National Association of Realtor’s Code of Ethics:

Standard of Practice 16-13 All dealings … with buyer/tenants who are subject to an exclusive agreement shall be carried on with the client’s representative or broker, and not with the client, except with the consent of the client’s representative or broker or except where such dealings are initiated by the client.

Before providing substantive services (such as writing a purchase offer or presenting a CMA) to prospects, REALTORS® shall ask prospects whether they are a party to any exclusive representation agreement. REALTORS® shall not knowingly provide substantive services concerning a prospective transaction to prospects who are parties to exclusive representation agreements, except with the consent of the prospects’ exclusive representatives or at the direction of prospects. (Emphasis added.)

This section admittedly applies to situations where you have a Buyer-Broker agreement with your agent – an agreement in which you have professed your undying loyalty to your agent in writing. While we don’t personally use Buyer-Broker agreements, considering them a bit heavy-handed and preferring to earn our clients’ loyalty, a lot of agents do use these bad boys. And, if I don’t ask the question, I may end up providing “substantive services” unknowingly – like talking comps. Or showing the property.

Even absent a written exclusive agreement with your agent, I ask the question because I consider it a matter of professional courtesy. Sometimes a buyer gets a little anxious; I understand. They know their agent is out of pocket for the next 14 minutes and figure, “What the heck! I’ll just have the listing agent let me in.” But unless there is that true sense of urgency – like the seller is going to accept an offer in the next 13 minutes – I am much more comfortable with the buyer’s agent performing the agency duties for their client.

How We are Paid

This is obvious to agents and most, I think, non-agents, but some people truly don’t understand the nature of our jobs. We don’t make a plug nickel until our client closes escrow. In fact, we are a debt center until and if our client closes escrow. So, if I am spending my time showing homes – my listings or otherwise – to someone who knows that they will ultimately be having another agent write their offer, I am doing pro bono work. I am doing someone else’s work. Which leads us to…

A Case Study

The reason for this particular bee in my bonnet stems from a recent encounter we had with a buyer who was not “working with another agent.” He was calling on one of my own listings. As it turned out, he fell into Category #4, a listing agent-direct buyer. Unfortunately, as is so often the case, our psychic powers failed us this day, and we learned the truth too late.

Since I have already exceeded my self-imposed 4-million word limit, I’ll leave you with the high points:

  • Man calls about new listing
  • Man is “not working with an agent”
  • Man wants to see home but has only two time slots
  • These time slots are already spoken for on my own dance card
  • I suggest that another agent from our office, one who in infinitely familiar with and has sold many homes in this development, could show him instead. This makes unrepresented man very happy.
  • Agent meets man, at which point man treats agent with general contempt and informs him that he will be having any future discussions about this property with only the listing agent.
  • Man vaporizes over a period of three days during which time listing agent receives multiple offers and seller accepts one.
  • Unrepresented man calls four hours after property is placed in pending status, proudly announcing that he is “ready to write an offer!” Presumably he was also ready to negotiate a portion of my commission, but I will never know. We didn’t get that far.

This, of course, was a bummer all the way around. While the gentleman no doubt thought that, by being disingenuous, he was simply employing a clever business strategy, using people is not cool. Not only did he strategize himself out of a home, he showed disrespect for another individual who dropped everything to work for free this day.

Or maybe he truly didn’t understand how we work and are compensated. Now he does.

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Office Location

  • San Diego Castles Realty
  • 10636 Scripps Summit Court, Suite 153
  • San Diego, CA 92131
  • P: 858.530.2374
  • F: 858.876.1701
  • E: info (at) sandiegocastles.com
  • CA BRE# 01853496

Broker Information

  • Kris Berg, Broker
  • CA BRE #01241572

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