Broker v. Broker

I think that is absurd. I am sure the property owner would be pretty pissed if their broker was turning away bids. That said, I am sure the seller's broker will support bids from non-represented buyers more to capture the whole commission. I don't think they have any basis to refuse to show you the property. If you have the address, contact the seller directly and tell them you are trying to see the apt.

Can always find out who owns the apartment and contact him or her directly.
Ways to do so:
Property records
Doormen
Neighbors
If you can visit the apartment, use the phone there for Caller ID, or just look for some paperwork.

This sounds very unethical to me unless there is something in the seller's contract with its broker which says that they will not show to a buyer represented by a broker -- and in NYC where it is the norm rather than the exeception for buyers to be represented by their own broker who on earth would agree to that???

It is indeed unethical, but we have had it happen to us more than once, which is why I raised the question. Wondered if anyone else had experienced the same issue.

I have not come across this issue. Is that what your broker is telling you? Maybe it is your broker?

I contacted a listing agent last week for some of the buildings that the developer built.
The listing agent took us to a few apartments on Sunday and we saw some units that we were quite interested in.
We decided to bring in a buyer's agent for a second viewing and have our buyer's agent to contact listing agent to schedule the viewing.
The listing agent called me and told me that since she was not aware that I worked with an agent before she showed me the listing on Sunday, we will have to pay for our agent's commission now that we decide to bring the agent in.

if you have proof of this I would fire the broker immediately!

hj1022 - the situation you describe is normal but I believe not the situation marthamedia is referring to. Believe she is referring to a situation where there has been no prior contact and she wants to see a property and her broker has contacted other broker to schedule and been told no.

marthamedia, I've only heard of this once. I was told that refusing to co-broke was illegal, but it was a broker who told me, so who knows. The broker has probably agreed to a low commission and refuses to share. The upside is that the unit is not being circulated to other brokers, and is probably just relying on a NY Times ad for exposure (good luck with that now). That could severely reduce traffic and create a better setting for negotiation for you, if you're comfortable going it without a broker.

it happened to me as well. i attended several OH's late last year. once the seller's broker asked me if i worked with a broker. and ofcourse, i replied yes. i was almost immediately dismissed. unfortunately, that's the way it is. hence, i posted a few days back asking to recommendation for an ethical and honest agents.

For it's worth, if it was me, I would go directly to the broker's office in person, demand to see the broker's supervisor/office director, and demand an explanation. I would not call, either, and I would be very, very noisy about it.

I noticed that Park Columbus has buyer sign a form during the initial visit that says that the buyer broker will only be paid if the he accompanies the buyer during that initial visit. Not sure if other devs do that too.

Chatham 44 did.

It's definitely not our broker, he's been very upfront with us. He is a friend as well and is the reason we are so aware of the games other brokers are playing. Have had many experiences at OHs like that of LookinginChelsea, where they refuse to co-broke and immediately become dismissive if our broker is there or we mention him. This past weekend our broker sent an email to an agent who was having an OH on Sunday, telling him that we were his clients and would be attending the OH, but that he would be unable to join us that day. This was the response: "if you are not in my open house you're buyer will be our buyers .. we don't work like that." Nice of him to make that decision for us, isn't it? Oy.

hsw9001 - why would someone sign anything just for the right to view an apartment?

Never sign anything until there is a contract with a meeting of the minds.

starfish/verain: Contacting sellers has definitely crossed my mind. If I were in their shoes I would want to know that this is going on! However, none of the properties appears to be so exciting that I've felt compelled to pursue it any further. Our broker is not standing in the way of us doing so, but frankly, there are enough fish in the sea these days that I'm not interested in jumping into a tank full of pirahnas to fight over a measly scrap of lunchmeat. I'll hold out for something better.

100% the right attitude Marthaomnimedia

haha! Thanks, verain. Darn that Stewart-lady for one-upping my domain!

Guys, what this is most indicative of is a dead real-estate market, with agents and brokers trying to hog commissions for themselves. They've probably reduced their commissions so they don't want to share.

But there's nothing unethical about it, beyond the fact that the real-estate commission system is as a whole unethical: since the seller pays the full commission, the "buyer's agent" actually works for the seller, so the buyer is never properly represented. Unless the buyer hires his own agent and pays for him out of his own pocket, and not as a percentage but as a flat fee, since any time a percentage is paid it would mean that it would be in the agent's interest to have a higher price whereas it would be in the buyer's interest to have a lower price.

This structure has been done away with for stock brokers, mutual funds, insurance brokers, etc. Real estate seems to be the last bastion of unethicalness.

The listing broker is obligated to show the apartment to all who show interest - otherwise he/she cannot fulfill their listing agreement with the seller. The listing agreement states the broker will represent their interests and market the apt. in a manner that will get the highest price the market will bear. Having said that, it is unrealistic for a buyers broker to expect a commission when he is not accompanying you to the OH's. It gets too complicated - and why should a seller's broker split a commission with someone who never even bothered to show up with their client. Your broker is not doing his job- he needs to be there for the initial viewing. Further, he SHOULD be there so he can give you his feedback on whether the unit is priced correctly, answer your questions and perhaps "pump" the other broker for info. that you might not be able to get.

But that seems unrealistic, stealth1. How can a buyer broker be there for EVERY client EVERY time? Particularly in an OH situation where if we are genuinely interested we will want to see it a second time anyway?

If no commission to the buyer's broker, the buyer should negotiate the sale price down 3% and ensure that the seller (independent of the seller's broker) understands the math behind it.

As for what is ethical or not, stevejhx, I agree with much of what you say. In my (admittedly) cynical view we unfortunately live in a world where being ethically and morally upright is far less important than making a profit and that is true for more industries than just RE.

verain - the commission percentage is set in stone and written into the listing agreement - whether that 5 or 6% goes to 1 broker or is split between 2 is the only open question. I have purchased 3 times in NYC and on the last 2 purchases I used a buyers broker - I went with Douglas Elliman who will do a "knock out" job on your board application. My broker was with me at the few OH's I attended but I must admit most of my viewing was done by appointment.

Stealth1, you are discussing a different matter: the obligation to show the apartment to all interested, vs. the obligation to share a listing. There is an obligation to show the apartment to all interested - not violated in marthamedia's case - but there is no obligation in NYS for brokerages to share listings. In fact, there is such a thing as the:

Exclusive Right-to-Sell Listing

An exclusive right-to-sell listing is the most commonly utilized instrument. It gives the broker the EXCLUSIVE right to earn a commission by representing the owner and bringing a buyer, either through another brokerage or directly. The owner pays both the listing and selling broker fees. The owner cannot sell the property herself without paying a commission, unless an exception is noted in the contract.

Being exclusive, there is no obligation to share unless it's written into the contract. In fact, since there's no MLS in Manhattan, in effect listings aren't shared.

NYS law allows for buyers' agents, sellers' agents, and:

DUAL AGENTS

A real estate broker may represent both the buyer and the seller if both the buyer and seller give their informed consent in writing. In such a dual agency situation, the agent will not be able to provide the full range of fiduciary duties to the buyer and seller. The obligations of an agent are also subject to any specific provisions set forth in an agreement between the agent, and the buyer and seller. An agent acting as a dual agent must explain carefully to both the buyer and seller that the agent is acting for the other party as well. The agent should also explain the possible effects of dual representation, including that by consenting to the dual agency relationship the buyer and seller are giving up their right to undivided loyalty. A buyer or seller should carefully consider the possible consequences of a dual agency relationship before agreeing to such representation.

While agencies need not share their listings, they must procure written permission to represent both parties. In New York the buyer is forced to sign a document consenting to this.

Marthamedia should check with her agent to see if the brokerage has a signed agreement with the listing agency to share listings. If it does, that would probably supersede the listing agreement.

And in this market, you should knock the price down by a lot more than 3%.

Stevejhx--you are mistaken. Rebny brokers are obligated to cobroke their exclusive listings with other Rebny brokers. Furthermore, most exclusive agreement explicitly state that the listing will be shared with the brokerage community as one of the marketing points. I am surprised at the frquency with which many posters seem to have encountered this. There are occasionally cases where a broker cannot cobroke but it is not the norm.

nyg, I'm not wrong. I agree with what you say, which is why I told marthamedia to check with her agent to see if there is a listing sharing agreement, rebny or otherwise. She doesn't mention who either broker was, so we can't be sure.

I also agree that MOST exclusive agreements say what you say; my point is that there is no requirement that they do, which is what stealth1 said.

I'm not at all surprised that agents are doing this: Judging by how fast listings are adding up on this website - +1,000 in the past 4 weeks - and how many "old" listings become "no longer available" only to show up again in a week as a "new" listing, it seems to me that the market is dead and agencies are trying to do whatever they can to a) keep the full commissions themselves; and b) manipulate the inventory statistics.

Furthermore, about rebny, the Cooperator magazine has this to say:

"Unlike other cities and states, New York City does not have a comprehensive multiple listing service (MLS) where all firms can see and share all available listings. The Manhattan Association of Realtors (MANAR) has been operating the Manhattan MLS since October 2002, and REBNY, according to Spinola, has its own listing service. More than 280 firms contribute listings to REBNY—listings, which must be co-brokered and shared for 72 hours with all REBNY member firms."

"Co-brokered and shared for 72 hours" is the requirement.

Given that rebny lists 3,413 open listings, whereas this site lists over 7,000, and at the end of March Miller Samuel gave the 6,194 open listings (similar to what was on streeteasy at the time) I wouldn't put much stock in rebny: it's a voluntary organization that as far as I know does not police itself.

"cobrokered and shared for 72 hours" is a typo. The rule is that the listing must be cobroked with the community within 72 hours

nyg is correct.

kewl, I only know what I read. I tried to confirm it within the website, but the info wasn't available that I could find. If that is a fact, it is a fact.

However, their website doesn't contain all available listings, and the organization does not police, which means they can do what they like with impunity.

A few points:

1) The New York State Department of State, which regulates these things (yes, believe it or not, broker conduct is regulated) states that buyers can be represented by who they want to be represented by.

Many, many agents have been educated that representation must be declared at first point of contact -- usually an open house sign in. The easiest way to do this is to sign in your agent's name and phone number at any open houses you go to.

HOWEVER, technically, according to DOS, where the representation gets declared is at the offer. You actually have the right to visit an apartment multiple times, chat up the listing agent, and then bring in a buyer's agent to make the offer.

Since this is obviously going to hack off the listing agent, in Manhattan this causes a fight, which your buyer's agent will usually win. It is, however, a messy fight. For protocol's sake, please tell the listing agent at the first point of contact that you have representation -- even if you don't know who it is yet -- because no one likes to be surprised.

IME, Outside of Manhattan, declaring that you have buyer's representation tends to cause listings to be pulled. I was told by a Brooklyn agent just last month, "If you had called ahead and told us your client had representation we would have given the apartment to somebody else." This is one reason why many Manhattan agents, myself included, don't work the outer boroughs.

ANOTHER EXCEPTION is new developments, where the paperwork you sign at the point of contact generally includes a statement that you are ceding your rights to buyer's representation. When you are looking at new devs, you generally have to bring your agent with you.

FINALLY, REBNY does not have a 72-hour cobroke rule -- that got tossed last year. In an acknowledgment of the Internet age, we now have a 24-hour cobroke rule -- all new listings must be cobrokered to the community within 24 hours of being signed.

As far as listing stats, I have no idea where one would go to compile them, since obviously not everything that sells in Manhattan, let alone the other boroughs, is a REBNY listing. The New York Times can sometimes have many duplicates -- I have seen four or five listings for the same apartment. And Streeteasy is an aggregator, but it does not automatically aggregate all the smaller brokers. I, for one, have to hand-enter my listings.

ali r.
{downtown broker, member, Real Estate Board of New York}

Yes you can be represented by whomever you want, but you can't force the listing broker to share the commission with that whomever.

NYTimes has lots of duplicates. I find the data here coincide with Miller Samuel pretty well.

But Manhattan is an opaque market, which real estate agents love.

There is no reason to sign a document in a new developer's office until you are ready to buy. Until then, you are just looking.

Furthermore, when you visit an open house, you are just visiting or looking.

When the buyer decides it is time to buy (or bid), he or she can involve a broker. There's no out to that for the selling broker.

There is no contract with the selling broker at all, and therefore the selling broker can't hold the buyer and the buyer's representative to anything.

This nonsense about protocol is just nonsense.

So, if I don't have a buyer's broker, am I ok having the seller's broker make an offer
and do a board package for me?

mea culpa about the 24 hour rule which I stated as still being 72. Trying to give up caffeine. Clearly NOT a wise plan :)

JMGJAG, I asked the question "am I ok having the seller's broker do a board package for me?" recently and the consensus was basically, yes, it's in the seller's broker's interest to assist w/ the board package, but you have to hope they're competent, since you of course had no hand in choosing them.

A clarification perhaps for some and a recommendation JMGJAG: to quote the NYState DOS Agency Disclosure Form, "A seller's agent ... acts solely on behalf of the seller." and "A buyer's agent acts solely on behalf of the buyer." It is NOT true that a buyer's agent represents the interests of the seller even though the commission is split. While there are trustworthy agents and brokers so that it isn't necessary in EVERY case to be represented as a buyer, unless you know the listing agent/broker it is riskier because no matter how warm, friendly and competent they may be, they are contracted to represent the interests of the seller ONLY. Therefore it is strongly recommended that as a buyer you choose to be represented and it does not cost you one penny. Agent/brokers' experience in negotiating can also be extremely helpful. NYS DOS also recommends to owners, by the way, that they sign Exclusive listing agreements because these receive the most advertising over the broadest market. Additionally, owners should know, and not all agent/brokers make this clear, that no matter what a particular exclusive contract says, an owner can cancel it at any time with a signed and letter.

... signed and dated letter ;-)