Fiduciary Responsibility – Get the Picture?

I had a pretty busy weekend showing property. That’s a good sign, I think – there’s a different class of buyer out there now, the kind of folks who were sitting on the sidelines in ’04 and ’05, who thought the market was too high and that the values couldn’t be sustained, and they should wait a bit. Well, the waiting for many of these people, it seems, has come to an end. Sure, the market is still in the tank for the most part, but some keen people out there recognize this as being a great time to buy.

I spent a good number of hours on Sunday driving around, looking at low-end properties. There’s a lot of low-end real estate out there these days, and a lot of it happens to be (surprise) short sale and REO listings. There were a lot of properties on our list (a good dozen, which is a fair number to see on a property tour). Now, you’d think that in a market like this, where there’s so much competition in the low-end of the market, that the listing agent would pull out all the stops to get potential buyers in to sell the homes, right? You’d think.

When you’re out looking at properties, naturally you get to talking, and my client was telling me a bit about how he’d chosen the homes we were seeing today. And he said something which isn’t surprising at all, but is noteworthy: “I just skipped over all the ones that didn’t have pictures.”

Everyone wants to know…

The fact that he said that isn’t really surprising, not to me, anyway. Most people are like that. What IS surprising is that there are so many listings out there that have no pictures. Not even a single exterior shot. Nothing. Now, I can appreciate that many of these homes are not exactly beauties – but a lot of buyers aren’t expecting them to be, when they’re looking at the bottom of the market. However, if there’s no pictures at all, and many listings DO have pictures, and you have so many to choose from – which are you going to look at first? The ones where you have at least a bit of an idea what the house is like, visually.

What really gets me is that sometimes, there are no pictures and no remarks. Or, sometimes the remarks will be so brief and uninformative as to be useless, like for example: “Nice 3bd 2ba home.” Yeah, that’s really gonna lure in the buyers, especially when there’s so many of them with so many properties to choose from.

Out here in California, every real estate licensee has a fiduciary responsibility to their clients. As part of that fiduciary responsibility, agents must exercise “reasonable care and diligence” as they do the work for their clients. To quote from the California Department of Real Estate Summer 2007 Bulletin, the following is among the fiduciary duties imposed on California Real Estate licensees:

To diligently exercise reasonable care, diligence and skill in representing a client and in the performance of the responsibilities of the agency relationship. By reason of his or her licensure, a real estate agent is deemed to have specialized and professional expertise, knowledge and skill in real estate related matters superior to that of the average person.

I’m not a lawyer, so I will admit that I am not qualified to give any kind of legal opinion about whether or not omitting photographs and remarks from the MLS falls below the level of “reasonable care and diligence.” It does seem reasonable to me, though, that if you want to sell a property in today’s market, that you at least put up a picture and some remarks that would make a buyer at least want to drive by.

While I’m on the subject, I just have to wonder: how is it that sellers let their agents market their properties like this? Do sellers not even hop on the MLS and take a look to see how their home is being marketed to the 87% (or whatever) of the buying public that shops for real estate primarily on the Internet? Sheesh.

Well, that’s enough vitriol for one blog entry. Thanks for letting me vent!

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Seb Frey helps long-time Bay Area homeowners make their next move easily the next one yet. If you're looking for a minimum of hassle, maximum net cash on sale, and certain results, contact Seb today.