So, as we do, let’s talk Real Estate, let’s talk CO-BROKING…
WHAT IS CO-BROKING?
It is essentially when two agents work together—one representing the buyer, and the other representing the seller (or, in the case of a rental, the landlord)—to complete a deal. The commission is split between the two agents. (Definition via BrickUnderground).
Another, less common, form of co-broking tends to happen with more expensive properties. In this instance a seller may hire two brokerages to work together to sell their property.
Now here is the thing, a listing agent does not always have to co-broke with you or pay you a fee. If they can find a buyer on their own, they can act under dual agency, as long as all parties agree.
WHAT PREVENTS EVERY LISTING AGENT FROM WORKING EVERY DEAL BY THEMSELF?
Many MLS groups protect their members by already having a co-brokerage agreement in place when someone joins their MLS. Terms and conditions always vary depending on the MLS you join, but many of them require a 50/50 split between buyer’s & seller’s agents. For example, REBNY (NYC MLS) technically requires ALL of their agents to co-broke and not just work with unrepresented buyers or renters. Co-broking is most beneficial for buyers because it allows someone to act in their best interest. The listing agent will always have a fiduciary responsibility to the seller so you really do want to make sure that both parties are being represented fairly.
NOW HOW HAVE I RUN INTO THIS RECENTLY?
Okay so back to my story I had started out with – I was trying to help a woman find a rental ASAP. The parameters were limited and there was not much on the market. I had seen a couple of places online but it looked like they were already being advertised by another agent, and in every instance when I reached out to the “listing” agent, they had made it seem like this was their exclusive listing. Unfortunately, in the area this client wanted to live, I could not tell if that was true or not because our MLS only had a few listings in this zip code. Every single one of these agents would say to me “I am not going to co-broke” and then hang up, or worse, ignore every single one of my calls or texts. At first I was so confused, so naturally, I did some digging. TURNS OUT, MOST of these agents did NOT have an exclusive listing for this apartment, they were just advertising it, hoping a renter would be looking for it, and then have this renter pay them a broker’s fee. So when they said they did not want to co-broke they were meaning they did not want to split MY renter’s broker’s fee.
LESSON LEARNED HERE
If you see an apartment being advertised on sites like Zillow or StreetEasy, find out who owns or manages the property, and reach out to see if they have signed an exclusive listing agreement. Often times, they have NOT. In that case, where there is NOT an exclusive agreement, you can work with the owner / property manager to set up a time to go and tour the property with your client ON YOUR OWN, without that original “listing” agent.
To you new agents out there, like myself, do not fall victim to these false Zillow / StreetEasy / other non MLS direct sites – there are a TON of fake “exclusives” out there.
**Full disclosure – I have nothing against sites like Zillow or StreetEasy, they can be very helpful, but it appears as though agents are able to post fake or not fully truthful ads on there. I ALSO want to clearly state that I do not promote trying to work around other agents. Do your research first and then do what needs to be done to meet your clients needs. My career goal is to ALWAYS be a fair and reasonable person here – that is all.**
WHAT ARE MY THOUGHTS ON CO-BROKING?
Well I will start off with I do not have enough experience to speak from truly BUT in my opinion, why would you not do whatever you need to in order to get the deal done? Even if that means co-broking?
Experienced agents – tell us your thoughts!!
Feel free to comment on the blog post HERE and let us know what YOU think!
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