Manipulating the Multiple Listing Service
February 14, 2019 |
There is a growing trend in real estate where listing agents are taking their fledgling listings off of the market as “Withdrawn With Release”. They then immediately put them back on the market as “Active”. Along with this, there’s a new Multiple Listing Service number, sometimes a new property description, and possibly new photos. But there is always a price reduction. To the consumer, the house now appears to be a brand-new listing and soars to the top of the real estate websites. Why would an agent use this deceitful tactic? Maybe the agent priced the listing too high, succumbed to what the seller felt the home was worth, or simply disregarded the comparables in his/her eagerness to obtain the listing.
Section One of the Canons of Ethics deals with General Duties to the Public And Industry, Article 1 states being a real estate agent indicates the agent is an expert in their field and will seek to avoid any appearance of impropriety. Article 2 states agents should endeavor to eliminate any practices damaging to the integrity of real estate. The agents who use the Multiple Listing Service to manipulate their ill-priced listings violate the Canons of Ethics without shame.
Let’s listen in on a conversation between a seller and his friend:
Seller: Get this! My real estate agent has a gimmick. If my house isn’t under contract within a few weeks, she’s going to have me sign a “Withdraw With Release”, then sign a new listing agreement and put it right back on the market for sale.
Friend: Why? What’s the point?
Seller: My house will go straight to the top of the real estate websites as if it is brand new on the market. It will fool consumers into believing the house has never been on the market before! Isn’t that a great plan?
This tactic skews the Comparative Market Analysis when agents need to determine accurate home values in any particular neighborhood. The house in question was on the market at one price for a limited time then, weeks later, the same house is on the market for fifteen thousand dollars less. Which home value is the true value? This tactic also makes agents look like they have to resort to “smoke and mirrors” to sell properties. Integrity and honesty are out the door. Realtors who take this approach give the community the distinct impression they are nothing more than participants on the game show “The Price Is Right”.
If a Realtor is going to list a house, then he/she needs to run current and accurate comparisons and tell the seller the listing price with confidence. If the house fails to generate an acceptable contract within a prescribed period of time, then the listing agent needs to reevaluate the confirmed sales in the area and be prepared to tell the seller a price reduction is in order. There’s no shame in revamping a game plan.