Agents second guess phantom bid regs

by Jordan Maxwell19 Jun 2015

Regulations to curb phantom bids have received praise from many agents over the last few weeks, however not everyone is gung ho about the changes.

“I agree that fines should be imposed on agents who break the rules, but RECO still needs to improve the complaint process for consumers,” Lesley Moll, a broker of record with Karma Realty Inc., told REP. “A client of mine reported a newspaper ad that did not include the proper information.

“A copy of the ad was scanned and emailed with the date and publication information. RECO had a very onerous process that was required, so my client gave up. Fines are great, but enforcement needs to be actually implemented by RECO without onerous impact on the reporting party.”

The comments highlight a larger issue as many agents applaud new regulations in recent weeks. The new rules, which force agents to keep a physical record of every bid made on a listing, will come into effect on July 1.

While RECO said the change is an effort to force better record-keeping among agents, many sales reps believe it's really an effort to curb the use of illegal phantom offers.

Dianne Beaman, a real estate agent with iPro Realty, said as much in a recent interview with REP.

“I had a number of clients who this has happened to where the offers have eventually disappeared and they ended up paying a significantly higher amount down the line,” Beaman said. “It’s a dangerous game some of these agents are playing. I also believe there will be a housing correction in the future so protections will be important and agents need to be prepared for whatever may come.”

Agents who value their real estate licenses will avoid engaging in that unethical behaviour, she added. Those who persist, they argue, will ultimately fall to the wayside.

“(It will) make people think, ‘I value my real estate license for the next 50 years,” David Fleming, a Toronto-based agent, told REP. It’s not worth misrepresenting someone today to sacrifice the dollars down the line.’”

COMMENTS

  • by Peter B. Realtor 6/19/2015 12:39:40 PM

    Tighten the rules to prevent Phantom Bids. Good.
    Refuse to make it illegal for an agent to post a pre-sold property on the MLS as a "no further showings and no escape". No good.
    Bandage one toe and shoot the other. I think RECO has to open its eyes a bit more , worry less about consumer impressions and more about what ethical Realtors have been telling them them to fix.
    Same for the Toronto Board.

  • by Josie Carrillo 6/19/2015 1:11:42 PM

    I would love to see what they do with these records. Will they be available to other agents. For example, I presented an offer last night for a CRE property in Waterfront Community between King and Adelaide. I was told there were 11 offers! I don't doubt there were multiple offers, but Im curious to see the actual number and what the offers looked like in comparison to mine. We went over the asking price of $800,000 by $200,000 and still lost to a higher bidder! They did not even keep a copy of my offer! Im sure they didnt keep any of them. How can they prove they had 11 offers? On another residential property we went over $50,000 and we won to a "supposed" number of 7 bidders! On the other hand, if Im the listing agent, do I really want to keep 11 offers? Most people come in with 1 copy. I guess after July 1, 2015, we all better request 2 copies or request that all offers be sent by email first! One for us to keep and one to return to Buyer Broker agent. Either way, I like the new rule, maybe it will keep more agents honest.

  • by Peter B. Realtor 6/19/2015 1:39:06 PM

    Yea, keeping umpteen copies of failed offers seems cumbersome and just plain dumb. All a listing agent should be required to do is keep a signed registry of all offers. Signed by the co-operating-submitting agent. No specific details to gum up the ambiguous notion of privacy, just an acknowledged list off all agents and their respective brokerages. Don't need the buyers names, amounts, details, just the agent registering the offer. What more proof would be needed and simple to attach to the deal file for future reference. Instead we get this mish-mash of rules.

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