When a Huntsville REALTOR® lists their own home or one of a relative, Alabama law requires the disclosure of this information. …Um …Why is this?
Well it should be obvious when giving some thought to this unique situation. The listing agent in question is in a very biased position with a large portion of their own financial welfare at stake. Thus to protect and inform consumers this information is made available in our Huntsville MLS listing details.
Some recent unsavory experiences shared on our local City Data website, also highlights another situation which is equally biased, but nonetheless a very popular tactic deployed by many buyers in today’s market. The tactic is to forego representation in contract negotiation and deal directly with the listing agent in hopes of getting a better price due to the lack of a buyer’s agent commission which is customarily paid by the homeowner.
Many listing agents will of course assist these unrepresented buyers in pulling comparables (CMA), crafting an offer and contract, and then presenting it to their client for consideration and this is of course ethical. However, some listing agents uncomfortable with this biased situation may also refer the consumer to a reputable buyer’s agent to represent their interests.
The important thing to remember, if deploying this tactic, is that the listing agent owes fiduciary duties to their client, the seller, and not to you as the buyer. Also remember that a Comparative Market Analysis (CMA) is not a simple button pushed by any agent that will always generate the same results. There is an element of subjectivity when pulling comparable sales and it is the duty of the listing agent to present their clients home in the most favorable yet ethical light.
Another point to keep in mind is that the seller has already contracted to pay a buyer’s agent fee and the lack of a buyer’s agent in contract negotiation does not necessarily mean a proportional discount of price. Remember the listing agent still owes their client a wholehearted effort to get the highest possible price for their home. Moreover an additional element of bias should not be overlooked: instead of discounting to the lowest possible price, the listing agent’s potential income in this situation has now doubled and they are likely to try and keep as much of this double commission on the table as possible.
Having said all of this, this tactic can be effective for knowledgeable buyers with ready access to detailed information; however it may also be a detrimental situation for many buyers, especially if they have formed an emotional attachment to a particular home. Therefore we suggest keeping your cool, consider using a buyer’s agent at least for your contract negotiation phase, and as always try and have fun out there.