"no broker" - on a broker's site? Need clarification

Is it a major brokerage or small fry (no insult to the boutiques)? I would guess the later. I've been told (by a successful broker at one of the majors) that the law in New York states that refusing to co-broke is illegal. If front_porch, urbandigs or johnrealestate would like to clarify, please do.

The broker likely has a deal with the seller for a low commission, like 3%, and therefore can't afford to split it. So yes, other brokers are not welcome. I remember one particular sleazeball, Mike Crespo from Citadel, stating that the buyer would be responsible for the buy-side broker's commission. I was told this is a definite no no.

front_porch has talked about this being murkier outside of Manhattan; not sure if the legality is different or just the enforcement (I think the later). Again, any clarification would be great, and I'd also like to know what the best remedy is, since, sorry, I have no idea what to suggest you do. Assuming I'm right, a complaint to the NAR may be appropriate, but I'm not sure it will help with the unit you're currently considering.

Anyone else enjoy Summer Streets today? Perfect day for a ride around the city.

It depends on what the listing agreement states that the seller signed with the broker. If its a typical co-broke, the listing broker has 24 hours, I believe as they just changed it from 72 hours, to SHARE the listing with the brokerage community.

However, if its an open listing OR the seller agreed in the listing agreement to give the exclusive broker firm a set time period to market it on their own W/OUT the brokerage community, maybe to try to save some commission would be my guess, then its OK. Clearly, by stating NO BROKERS, its either an open listing or the listing broker was :

1) given exclusive permission to do so because of a pre-determined deal with the listing broker
2) the broker is trying to minimize outside brokers, yet could be still sharing the listing on central systems
3) the broker is trying to minimize outside brokers + is not sharing the listing; in which case is a violation

Greedy sellers in this case, usually will not negotiate off their price. Buyers should think this way.

tandare, I forgot one other thing. It could be a buy-side broker fishing for clients with the a sell-side broker's listing. They're hoping you'll call them to "show you the unit," which means they'll bring you to the seller's broker and collect half the commission for representing you. I would avoid these folks in every case, as you can usually do a little detective work and find the real listing, then decide if you want to use a broker at all or bring someone of your choosing (such as urbandigs). How do you know if it's a fishing listing? The surest sign is the lack of an address, as the broker doing the fishing doesn't want you going straight to the seller or his/her broker.

Digs, thanks for the quick response.

So, in an open listing, the broker isn't THE broker, just A broker? I suppose in that case it's fine for the buyer or a buyer's broker to contact the seller directly (assuming it's not a fishing listing and the address and unit are known)?

An agreement between the seller and a sell-side broker can get around the co-broke rule? (I guess it's not actually a rule, then) I never thought of that, but I guess it explains a broker like Saulo Scheve (nice guy w/ listings on Craigslist), who always has listings in HDFC buildings, won't co-broke and probably takes much less than 6%.

And in your case 2, "no brokers" in the listing is actually just hopeful BS? In that case I guess the buyer's broker should give it a shot.

The fishing brokers are easy to avoid. If it's not that, any thoughts on how to determine if it's a non-co-broke exclusive deal, open agreement or broker BS?

it is in no way "illegal" to refuse to co-broke. It is however *actionable* for a licensed real estate broker to sell to a buyer brought to him/her by a licensed real estate broker and refuse to co-broker. There is no law requiring a broker or any other person to honor buyers with brokers, period.

Thank you Tenemental, Urbandigs, Totallyanonymous for the helpful clarification!

I am wondering, as Tenemental did - any further thoughts on how to determine the reason behind the no-broker rule....

Totallyanonymous -- This seems not legal somehow to refuse to co-broke or not sell to someone with a buyer's broker (wouldn't that be discrimination on some level?)

The unit in question is not 'fishing', or at least I don't think so since the address is clearly posted for an open house. Yes, it is outside of Manhattan. And yes I have a buyer's broker who is working with us. Can there be any harm in me going to the open house, signing in with my broker's name and seeing what happens? Or are they going to freak out on me while I'm there?

Also for our friendly real estate brokers and experts - is there a source for NY State regulations or REBNY info about co-broker / no broker stuff - that the general public can read/keep as a reference?

As you can imagine, when a listing says "No brokers", it usually comes down to the $$$ - whether posted by a FSBO or a broker.

The vast majority of Real Estate transactions have two broker firms - buyer and seller - and two agents. The Real Estate fee is shared between the two firms, and split again with the two agents. These are what are called "exclusive" listings, and are what you would typically think of when you think of a broker listing - the "exclusive" right to market and represent a property for a particular period of time, typically six months, though it could be less, or even more.

The other main flavor of listing is an "open" listing, where a seller agrees to pay a broker (or perhaps one of several) a reduced commission - typically half what one would expect to pay - if that broker brings a buyer that results in a sale. Since there is only $$$ for one side of the transaction, the broker is looking for buyers only, not buyers being represented by another broker. Whether or not open listings are, on the whole, advantageous to the seller, can be and has been debated on these Boards ad nauseum. The obvious advantage is that the seller pays, perhaps, 2.5% or 3.0% instead of, for example, 5.0 or 6.0%. The disadvantage is that he will have a much smaller pool of buyers looking at his apartment. And, as the theory goes, MANY buyers from MANY brokers will lead to a quicker sale and most likely a higher price. The other downside is that unless a broker has the exclusive, he is not very likely to commit much in the way of time or resources to selling that apartment.

It gets a little complicated because of the REBNY (Real Estate Board of New York) rules. Real Estate firms that belong to REBNY are required, by rule, to share (co-broke) their EXCLUSIVE listings with other REBNY firms (much like an MLS, though REBNY technically is not an MLS). All the "name" firms, and most of the "no-name" firms, at least in Manhattan, belong to REBNY. The advantage is pretty clear, to the sellers, the buyers, and the brokers. If I'm looking for an apartment for my buyer, I have access to the thousands of co-broke listings in my database.

The non-REBNY firms are typically smaller firms that don't want to work with other brokers - which means they usually won't share their exclusive listings, and instead hope to find a buyer for their seller without reaching out to the broker community. In effect, they're working both sides of the transaction. And even though REBNY firms may also have both the buyer and seller for a particular transaction, it's by far the exception, not the rule.

There are no legal / discriminatory issues involved - save for the REBNY regulations that their broker members must co-broke their exclusives.

So... if you see a broker listing that says "No brokers", the likelihood is that it is an OPEN listing - advertised by either a REBNY or non-REBNY broker, for a seller that has agreed to pay that broker (or perhaps any one of several) a reduced commission to provide a buyer that leads to a sale.

Or-

Somewhat less likely, it is an exclusive listing by a non-REBNY member who plans / intends / hopes to find a buyer himself - or someone else within his firm -for his seller, and keep the more-or-less entire "typical" commission for his firm only.

Or-

I believe the seller can override the REBNY "exclusive" rule, by stating in writing that he / she does NOT want the listing agent to co-broke with other brokers, but that's clearly not in the seller's best interests.

Excellent explanation. Thanks.

tandare-

If you visit an Open House for a listing that says "No brokers", the expectation is that they do not plan to share any commission / fee with your broker. Of course you can ask, but that's what you should expect to hear.

Re broker regulations for you to reference, probably the two best sources are the NYS Department of State's website, the NY Real Estate Law section. And the Code of Ethics on the REBNY site. Yes, they're both pretty dry, but not terribly long.

tenemental-

re "buy-side broker fishing for clients" - pretty unlikely, since the listing broker would be p****d if he caught wind of someone advertising his exclusive. And I'm sure it's a violation of one regulation or another. This method / tactic is pretty much only used for open listings, and, as you mentioned, WITHOUT listing a complete address.

re Open listing, "A" broker vs "THE" broker - there will only be one broker in the transaction, not two - but the seller may have made an agreement with multiple brokers, to pay a "reduced" commission to the one who brings a buyer leading to a sale. But it gets down to which brokers would be interested in doing this, since a) the seller can sell by himself at any time; b) ANOTHER broker may bring a buyer at any time. Working with open listings is often a way for new agents to start out until they get listings of their own, but not a very productive use of an established agent's time and effort.

johnrealestate1, I should have made it clear that much of the fishing does indeed occur with FSBOs, where some time spent at the Times website and Craigslist would reveal the seller's own listing and either save the buyer money (I've seen the fishing ads increase the price to include the commission-there's one like that at Cohen Smith Chang for 165 Christopher St. adding 6%!), leave the buyer with more negotiation power (no commission for the seller to pay), or enable the buyer to bring in the broker he really wants. I guess these, like you said, are cases of open listings where the broker(s) reached out to the seller and were offered the non-exclusive for a smaller commission.

I also see a ton of this in new construction, where the pictures and descriptions (and sometime floorplans) from the sell side are used by the fishers but the address is left out. In these cases there are definitely both sell and buy-side brokers involved, but perhaps the fishing isn't so offensive because the sell-side brokers aren't on straight commission?

Though I'm sure it's frowned upon and probably a violation, I do see fishing happening on what look like exclusives. One off the top of my head: 645 E. 11th Street Apt 4B. NestSeekers (one of the senior brokers) has been running open houses and listings w/ full info for ages, so I assume it's an exclusive, but Century 21 has been running an ad sans address in the Times continuously as well (w/ no broker name attached). Unless it's an open and NestSeekers is just risking a ton of time and expense. Another is 203 Spring St. It's a Corcoran listing, so I'd imagine it's exclusive, but I see other listings of a numberless "Spring St." apt that's clearly the same unit in the pics. 50 King St. is another, with Corcoran listing it w/ address and Bond listing it without.

tenemental-

That's one of the big problems when brokers advertise a FSBO listing, when FSBO's and the broker(s) are advertising the same apartment in the same venue at different prices. It's tough to present a listing to a buyer at an "inflated" price, when they can see the same listing for themselves, maybe three pages back, at a different (lower) price. While most buyers understand the buyer agent provides value to the transaction, seeing the same listing for, say, 330K (FSBO), or 339K (broker), which would you pick?

I don't do much new construction - pretty much Co-op resales - but it's a different animal. In the case of working with management companies, that's the typical "open" listing, where they'll pay a buyer broker 2.0, 2.5, or 3.0% of the transaction. Since ANY broker can bring a buyer, you may see the same apartment being advertised in the NY Times by five different companies, and maybe 10 different agents. You'll see this often in the case of vacant sponsor apartments. In the case of a brokerage firm (maybe a Douglas Elliman) representing new construction, I believe they usually work with buyer agents, but since they are the "exclusive" broker, I can't imagine they'd like other brokers advertising their listings.

I hear what you're saying regarding those three examples, but don't gave a good answer for you. Those three listings have been under exclusives by the two firms you mention (though I show 645 East 11th - 4B is off the market as of 8/6/8), and I don't know why firms would advertise another firm's exclusives. Agents have been known to advertise very "generic" listings, in the hope of generating phone calls - but that happens more in the rental world, where info is usually sketchy, anyhow. With sales, you need photos and a floorplan - which means having access to the apartment, or stealing the listing agent's photos / floorplan - usually not a good idea.

It's not that unusual for a lazy / busy agent (you pick) to use some form of "stock" photo to get his listing up, and hopefully update it as time permits. The strange part would be this happening between companies. Again, not really sure what's happening here.

"In the case of a brokerage firm (maybe a Douglas Elliman) representing new construction, I believe they usually work with buyer agents, but since they are the "exclusive" broker, I can't imagine they'd like other brokers advertising their listings."

I does seem questionable, but there's plenty of it in new construction from brokerages like NYLS, Homestead, Hercules, etc. I've seen Craigslist ads with pictures straight out of the developer's advertising, but they'll only mention the neighborhood and amenities. Julie Hoffman from TREGNY, for example, has been using a floorplan and mid-construction photos to run multiple listings in the Times for 21 Ludlow St. for many months. Speaking of Elliman, someone advertises the River Ridge condo, which they are marketing, on Craigslist using the rendering of the building that's here at StreetEasy. They even have their own web address for the development in the listing.

REBNY code of ethics

http://www.rebny.com/pdf_files/CodeOfEthics11_07.pdf

Brilliant! Thanks for the clarifications.

As for 'fishing' I've seen tons of listings and I have wondered what the deal is with that.

It is an open listing - so the broker cannot co-broke the listing. The broker either has owners permission to advertise or doesn't and is doing it anyway. He is fishing for customers and to try to sell the place since he probably has no listings on his own.