Every industry has to deal with questions of law and issues of ethics. Real estate is no different. After reading a recent Realtor.com article, I found myself wondering, if a buyer can only make one offer at a time in a tight, low inventory environment, is it fair that a seller can wait and hold up responding to a buyers offer for the express purpose of soliciting multiple offers?
It’s certainly legal, maybe even a very successful marketing tactic, but why then are buyers expected, or sometimes even constrained by law to make only one offer at a time?
One case scenario –a Listing agent sets a low asking price for the express purpose of driving bids up artificially.
How ethical is that? It’s lawful, but is it ethical?
Usual scenario – two or more buyers see a house in any 24 hour period of time. During the reasonable time frame a buyer allows a seller to make their decision, the agent is informed of another or several other offers coming in.
Suddenly, the “fix” is in, the pressure is on and the original buyer finds themselves in a precarious situation. They saw the house first, they made the first offer, now they are stuck playing a guessing game of “who’s got the BEST offer?” This leaves a buyer possibly paying more than they really wanted to pay and maybe more than they SHOULD be paying! Many feel pressured into giving away their rights to home inspections, they are led to believe they’ve lost the ability to ask for closing cost help or for repairs to be made and essentially ending up purchasing “AS IS” for TOP DOLLAR!
Lawful, but is it ethical? What kind of response should agents have to this situation?