Mastermind for March 28th Check The Facts on Those Listings and Bad Luck Closings
Happy Wednesday. Kind of a quiet Mastermind this morning. That’s ok. You can’t hit everyone out of the park. Thanks to Tom Bosley for coming by. It is always great to get his advise and listen to his years of experience on any topic. If you missed today’s Mastermind, you missed a great discussion on checking your listing and things breaking days before closing.
This week one of our agents told a story of how, with two days before closing, his client called to tell him that there was a leak in one of the bedrooms. They quickly sprung into action, called the roofer who arrived right away only to discover the leak was from a pipe and not the roof. Relief. After accessing the damage our agent called the Buyer Agent, explained the situation and agreed on a plan to get it fixed. A minor inconvenience at most but what was funny was that almost everyone had a story of things going wrong with houses within days of closing. We started to wonder if it was possible the house was somehow voicing its’ displeasure with the seller leaving. One agent told the story of a seller packing up the last box in his condo and deciding to do one last load of laundry. That, it turned out, was a costly mistake. unbeknownst to the seller, the washing machine would not stop filling. The water ended up flooding three floors down and he, having cancelled his insurance, was stuck with a $30,000 bill. Ouch. We also hears stories of broken pipes, leaky basements, sewer backups and broken appliances. It is kind of amazing just how often it happens. It seems clear that it is important to have full home and content insurance on a property right up to the moment of closing.
Next we talked about a recent case where the Selling Agent and the Buying Agent didn’t verify facts about a listing. It ended up costing them both $10,000. Double ouch! Here is the story. Agent Jones listed a home for $559,000 and stated on the listing that the house had a private driveway and a single parking spot. Agent Jones did not notice that NO curb cut existed, and in fact it was Agent Jones who had sold the property to the sellers just over a year ago. At that time, the MLS information sheet made no mention of a private driveway or parking. Along comes Agent Smith and his clients who end up buying the house. Agent Smith took the listing at Agent Jones’ word and did not inquire as to the legality of the parking. Shortly after the property closed, the Buyer got a parking ticket on his car. The Buyer contacted the area Councillor’s Office who verified that the parking spot was illegal and that there was a moratorium on granting future parking spaces. With little recourse, the Buyer complained to RECO. The outcome of the case placed the blame equally on both agents because both Jones and Smith didn’t ensure the accuracy of the representations made on the listing. There were a host of other charges under The Real Estate and Business Broker’s Act and The Code of Ethics and they were both fined substantially.
It seems clear that there is a substantial duty to verify all the facts on a listing and nothing should be left to chance. Our duty to our clients, particularly our buyer clients, is to verify the information on a listing. If you are listing a condo, even if the same unit has been sold five times, you have a responsibility to measure it yourself. Do not rely on the measurements of the previous agents. What seems open for great debate is how a discount company, that simply exists for mere postings purposes, is able to verify information provided by a seller. Our rules are pretty specific about a brokerage’s duty to provide accurate details on their listings. Food for thought.