Sunday, December 15, 2013

Ethics....Someone is asleep in the guard house.

Several times I've asked my real estate friends if they can justify charging percentage commissions - especially in higher prices.  Let's face it, the seller of a $400,000 home pays $10,000 to $12,000 more in most cases although "commissions are negotiable".  Double that for a $600,000 home and the numbers get crazier after that.  No one has been able to tell me what sellers get extra for the extra money they pay and make sense of it.

Now, if a real estate broker takes thousands of dollars from a seller without pre-listing disclosure or post listing accounting, is that ethical?  No.  No. and NO!  But this unethical activity occurs thousands of times daily and no one questions it.  Who's protecting the public?  It it the various Realtor organizations?  No, they represent the broker and agent members.  Is it state legislators?  Guess not.  How about the Real Estate Commissions around the country?  Nope, they're sitting on their duffs too!  And they SHOULD be protecting the consumers!

Think of this -- if one third of New Jersey owners who sold through the MLS's saved an average of $3500 (both conservative assumptions) it would amount to over ONE HUNDRED MILLION dollars each year.  And nationwide it would reach FIVE BILLION dollars.  How could this be?  How could the legislators and commissioners the public thinks is protecting  them do such a poor job?

Where is this covered  in the National Association of Realtors Code of Ethics?  Can anyone make sense of this one?