This bit from RedFin (tipped by FoREM) reads to me like a dual agency lawsuit waiting to happen.
Why?
Because RedFin is paying an extra incentive for its buyer clients to purchase a home from its seller client before the seller’s home is MLS-listed. RedFin would surely argue that no agency has been created, but in fact what they have is a pocket listing — an exclusive — and they are representing the seller as soon as they seller decides they are. I’m not crazy about the idea of implied agency, but that’s almost certainly the way the gavel will drop if this comes before a judge.
What would be the seller’s beef? By inducing him to sell without putting his home to the full test of the marketplace, by means of an MLS listing, RedFin may be cheating him of proceeds his home might have earned for him. An exclusive listing sold in-house stinks to high heaven — and if it smells bad to a jury, it doesn’t matter how it smells to anyone else.
Say what you will about Help-U-Sell, Assist-2-Sell and all the other limited-service brokerages, at least they have experience in the real estate business…
Technorati Tags: blogging, disintermediation, dual agency, real estate, real estate marketing
Harvey says:
but the seller still has to agree to the sale, if he agrees to sell at the price offered, then redfin can’t be held legally accountable because he (the seller) chose not to actively market his property
August 17, 2006 — 12:24 pm
Greg Swann says:
Real estate lawsuits are normally brought by parties who consented at the time to what they later decided were injurious actions by the broker. The argument, not without merit, is that the broker should have protected the client from consenting to an arrangement that was, in fact, to the client’s disadvantage. Even if RedFin were not also representing the buyer — creating a dual agency in Arizona but possibly not in Washington State — encouraging or facillitating the sale without the full test of the marketplace puts them on thin ice.
August 17, 2006 — 12:38 pm