The Boulder Property Coming Soon Sign
Ever seen Boulder real estate with a Coming Soon sign out front? Me too. How about all those times you read the listing description of a Boulder property in the MLS and it says “showings begin [insert date that isn’t this week!]?
Yes, here I am trolling the neighborhood with ready, willing and very able buyers and “house candy” is being dangled in front of us, but we can’t get in to see it (yet).
Is the house not show ready yet?
Work is being done and it’s unsafe to enter?
Or… Does the listing agent just want the chance to show it to their buyers (or the ones they hope to snag from the sign in the yard) first?
Is a Boulder property Coming Soon sign disadvantaging my client?
This is a good question and a valid concern. Could this tactic also be used to lure my new buyer away from me and into the enthusiastic arms of the only broker who can show them their dream house… The listing agent?
Let’s cut to the chase and review what the Colorado Real Estate Commission (CREC) says about “coming soon” signs. All else is speculation… And yes, I’ll be the first to admit that if my Buyers actually leave me to work with someone else, I need to ask myself if I was providing them with enough value, before I lodge a complaint!
The Colorado Real Estate Commission admits they have received a lot of inquiries and complaints about brokers advertising properties as “Coming Soon”. Mostly it is believed that the listing agent is limiting showings/exposure in order to “double end the deal” – work with both the buyer and the seller. Why? Because the listing agent notifies parties that are interested that the property is already under contract by the time it’s given full market exposure. Hmmm… Does sound a bit suspicious.
The Commission Position Statement (CPS) requires the broker engaged by the seller to “exercise reasonable skill and care for the seller” and to “promote the interests of the seller with utmost good faith, loyalty and fidelity”.
IE: The broker is required to advise the seller “of any material benefits or risks of a transaction which are actually known by the broker”. This is to be done DURING THE NEGOTIATION OF THE LISTING CONTRACT and includes limiting exposure by delaying access to showings or an open house. Or limiting the amount of time the seller will consider offers.
The CREC goes on to say in their position statement (CP-44, adopted June 3rd, 2014) that the motivation for limiting exposure should be carefully considered and it is advisable to only use “Coming Soon” legitimately – like when the seller is still getting a house ready to sell.
Limiting exposure with the intention of trying to “double end the deal” is a VIOLATION OF LICENSE LAW because it lacks “reasonable skill and care”. This can be viewed by the CREC as failing to promote the best interests of the seller with utmost good faith, loyalty and fidelity.
Sellers choice to market Boulder Property “Coming Soon”
Ultimately it is the sellers choice on how to market the property, where and when. But the broker must advise the seller of risks/benefits associated with the choices OR the broker risks being disciplined by the CREC. (The CREC will discipline especially when there is financial loss to the seller/buyer.)
In short – Your broker must advise you, Seller. Then your decision about the marketing of the property must go into the listing contract.
Ok… I know you love my true stories and of course I have one that suits this occasion! 🙂
I was contacted by a client and asked to help sell her house in Longmont. We discussed price and the market etc. Then I asked her about doing an open house. “Yes” she said. “The first weekend it goes on the MLS.”
The house was still mid-renovation at this point. A bathroom was being added and it was currently a blank room with pipes in various parts of the walls and floors. No fixtures, no tile, no paint… not even a door.
The seller instructed me not to put the house on the MLS yet, or to put a sign in the front yard until it was in showing condition. I had advised her that a “coming soon” sign might create a little buzz, giving us a bunch more showings and a busy open house when it was ready. She said “No thanks, I don’t want the neighbors to know yet.”
A week or so later, I acquired a buyer who was looking for this type of property, this price range and in this location. I asked the seller if I could show her house to the buyer and she said yes. She was (I would even go so far to say) excited about possibly putting together a deal without showings, open house or yard signs. In her mind, a perfect deal involved a buyer who would love the house like she did. It didn’t matter to her if the house never went ACTIVE on the MLS, if she got the price she needed.
I went on to remind her the benefits of floating the house on the open market included but were not limited to the possibility of competitive offers and a higher contract price and also getting a buyer who might be more financially qualified.
Then we discussed what the benefits were for me, the broker, in either scenario. Lay it ALL out on the table… that’s what I say!!
1. Financially: Actually I had agreed to reduce the total commission paid by the seller if I double ended the deal. (I won’t go into details here, but it’s my policy and I’d be happy to discuss that in person with you.)
If I sold her house to a buyer who was otherwise represented, the seller would have paid more commission overall… And assuming I took my buyer to someone else’s listing, I would have been paid more overall (most likely).
NET LOSS to me for double ending this deal.
2. Duties and Responsibilities: They stay the same, but I’m obliged to act responsibly for two parties not one. And in no one parties best interests, over the other.
NET NO LOSS/NO GAIN for me to double end this deal.
3. Brain damage: I’m a control freak! I like to be kept in the loop and I hate last minute surprises. Working with both parties feeds my need for communication and gives me more control over the deal.
NET GAIN to me for double ending this deal.
Overall… I give up money for control and call it good! 🙂
All’s well that end’s well. The buyer went on to complete the purchase and is living happily ever after in the house as I type.