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January 28, 2013

11

Are Some Realtors Using Third-Party Sites To Game The System?

by mark mclean

scammerIt’s a popular term that you have probably heard before. If there is a way to beat the system, someone will find it. Not surprisingly, it applies to the business of real estate too. At first I was enthusiastic about those third-party sites like Craigslist and Kijiji. Hey, if I have a listing I will promote it on as many sites as I can to get the most exposure. That’s my job. But more and more I see some agents trying to game the system. It’s as if those agents said, ” I can use this un-policed site to make money”. Can you blame a guy (or gal) for trying? Over the last few months, the number of real estate scams I’ve seen on the web makes me shudder. Not to single out one site or another, but I wonder if third-party sites, not under some type of control, are turning our business back into the wild wild west. I can’t imagine the founders of these sites ever intended their sites to be used these ways.

We’ve heard this story a fair bit, but I finally heard it first hand from someone who had been scammed. This person was looking for a rental apartment. She saw an amazing place in her price range and the “owner” said it she could have it. She put down a deposit and went home. A week later she thought it might be a good idea to go check it out again. She phoned and emailed the “owner” but was unable to reach him. Finally she went to the apartment only to find that the current tenants weren’t planning on moving out. As it turns out, they were away the weekend the apartment was shown. Burned!

Equally, if not more distressing is the behavior of Realtors like this one; This agent logged into TREB found a couple of nice condos, used the pictures and descriptions to create a few ads and then post them as their own listings. Potential renters are calling and arranging showings presuming they are working directly with the owner or listing agents. So you might say, big deal. At the end of the day the apartment gets rented. Isn’t that the goal? I suppose you could make that argument but why should someone take advantage of the work I did to get the listing in the first place? I didn’t give that agent permission to advertise my listing. In this case, the scammer agent was working at a resort in Mexico when I contacted her about a rental. She offered to have someone in her office attend the showing. Poaching listings is rampant in our business and this example barely scratches the surface of the type of shenanigans that agents figure out. The DDF or Data Distribution Facility may take care of some of these problems, like the accuracy of the information, but…as one door closes another one is sure to open.

How about the agent who had a listing on MLS at one price and also advertised it on Craigslist at a different price with the proviso the buyer use him to purchase the house? The Craigslist ad also didn’t contain any of the required information that is required under our guidelines. Designation, brokerage, contact information.  Do you care? The internet is a big place.  I have to believe there are a lot of agents using third-party sites to rightfully promote their listings. That’s great. But what about the scammers and cheats who are playing the system? They know full well that RECO can’t patrol the internet, and most agents aren’t checking to see if people are poaching their listings. And if they do, are those agents going to launch a complaint knowing that it will take 8 months to get to a hearing? Years ago, organized real estate was established to protect the public. Rules and regulations were written to make sure real estate transactions were done fairly. Is that protection gone out the window?

Is the sharing of data, through IDX leveling the playing field or making the system easy to beat? If you are part of IDX your listings are shared on every other agent’s website. Honestly, I’m okay with that BUT I want the public to know that if they are on Joe Smith’s Website  the listing they are looking at is actually mine not Joe Smith’s. I want my name at the top, not buried somewhere in the bottom. Oh and while I’m on the subject, why can’t I brand my video tours? Argh, it makes me crazy!

Have you been scammed on a third-party site? Do you have an interesting story about an agent finding a creative way to beat the system? What can we do about it?

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11 Comments Post a comment
  1. Jan 28 2013

    There are also agents that try to work an OFFER, where the buyers / Tenants have not yet signed anything to get the best deal possible.

    Do you have anything in writing?

    Reply
    • Jan 28 2013

      For sure. There just aren’t enough people to police it all.

      Reply
  2. Jan 28 2013

    Hi mark. We had a different experience trying to sell my partners car. Scamming comes with the Internet territory. MlLS was created by realtors, for realtors. We should stick to the trusted sites just like we do in with on line banking
    Buyer beware has more punch in the vast vast World Wide Web.

    Reply
    • Jan 28 2013

      So true. I guess we need to better communicate how much value our work adds to the equation.

      Reply
  3. Jan 28 2013

    Buyer beware. The MLSwas created for realtors by realtors. It is a trusted site at best with the exception of mere postings.(another topic for another day). I had scam attempts when I posted personal items for sale on Craigslist and kijiji… We would not do our on line banking without the assurance of a trusted site. Just like any major purchase the public needs to be more selective and seek the services of a professional to assist them, whether its a car purchase or a rental. The reality of the World Wide Web is that it’s grand unknown entities are out there trolling…. The public and realtors need to stick to a system designed to sell their product. The is the MlLS

    Reply
  4. Jan 28 2013

    We put all our listings on Kijiji but are very careful to strictly adhere to the RECA advertising policies and make sure everything is disclosed. We only advertise our own listings. We have a fantastic response rate, 10x that of MLS. But I think it has to be done ethically and carefully. There is certainly the potential for abuse. However, I firmly believe that you can’t “legislate” ethics. The bad eggs will always find a way to scam. We just need to freeze them out somehow.

    Reply
    • Jan 28 2013

      I agree 100%. Thanks Christine and Happy New Year!

      Reply
  5. Mike Carson
    Jan 28 2013

    Mark, branding your videos is a policy decision of TREB, not CREA. Some boards allow it.

    Reply
    • Jan 28 2013

      Yeah, I hear you. I don’t quiet get the logic behind it. I’m going to get to the bottom of it though!

      Reply
  6. Feb 7 2013

    Mark,

    Great blog post! Though I had heard about similar scams, I had not heard one that went like that. Thanks for sharing.

    To answer a couple of questions from my knowledge of the regulatory environment within which you work:

    1) IDX listings must show the listing brokerage’s name, not the listing agent. This is because, technically, you don’t own your listings, your brokerage does. When you see a trademark attributed to Nike, for example, it’s not credited to the graphic artist who designed it as he or she designed it for Nike, whether as an employee or third-party design house. I know it’s not exactly the same, but it has helped my clients (I’m a marketing guy, not a REALTOR®) to understand this in the past. BUT… if the IDX is not showing your company name as “brokered by…”, THEN you have a case, which you would take to your board, not RECO. It will be up to the board to challenge the 3rd party website provider, which will likely move more swiftly that a RECO complaint.

    2) The unbranded virtual tour comes from a situation where agents would make a virtual tour with their branding, which may include 1% listings, buyer incentives etc. If you’re sitting in a deal / closing room with a client showing them listings on TREB or you send them the listings by email and your client clicks on the virtual tour link and finds a compelling marketing message from another seller, it can put undue pressure on you to defend your commission rate or service offering. So then you have to counter with an even more compelling value proposition. This can often lead to the “wild wild west” that you fear for this industry. What should happen, though, and I told TREB for years, that they should simply add a second field for a branded tour, and that field would be sent to portals (realtor.ca, third-party IDX systems etc) while the unbranded tour field stays in the TREB environment. Knowing both software and non-profits as I do, I know this is way more difficult than it sounds, but not so difficult that it couldn’t have been implemented in the 6 years since the rule was introduced, throughout which I had suggested it on several occasions.

    3) It’s too bad that a system was set up to take care of the consumer, the one who is least informed about the regulations, and not to protect the REALTOR®, the one whose supper table depends on his or her success, but it is a reality. To say that a complaint will take 8 months so I won’t bother filing a complaint, however, is not doing you, the public or the industry as a whole any justice. While I would not recommend taking one of your colleagues to task because they forgot to put “brokerage” or “Sales Representative” in the appropriate places in their marketing materials, I would recommend filing any grievance with RECO about scammers or deliberately-misleading real estate professionals (or unprofessionals), no matter how long it takes for a hearing. Otherwise, you are promoting such “indiscretions” by letting them slide and, in doing so, sending a message that it’s okay because it has not directly removed money from your pocket, at least that you can prove. If enough honourable sales professionals file complaints about these cowboys, eventually, it will be noticed and something will have to be done. If not, then you as an industry take all your emails and filings to the media as a group and something will eventually get done. We’ve all seen it happen.

    So I hope I’m not out of line in saying anything here, but much of concern affects the marketing world, which is the work in which I live, so I felt I should set the record straight.

    Thanks again for the post. Very interesting and thought-provoking.

    Kindly,
    Matthew

    Reply
    • Feb 7 2013

      Hey Matthew, thanks indeed for responding to my post. I like what you have to say. In 1. the IDX,I haven’t yet seen an agent NOT have “brokered by” yet (thankfully) but the reality is that that wording is soooo small that I can’t see how a member of the public, scanning through an agent’s website would even see it. If I had my way, I would want it in big bold letters right at the top, then, at least it is clear which company is brokering the listing. I think disguising it it small print isn’t doing anyone a favour. in 2, Lots of video companies will happily produce 2 videos, branded and unbranded, but it is still a giant hassle. Perhaps the rule should be, you can ONLY put the brokerage and agent name on the video. No website or promotions. Just a thought. 3. The whole RECO proceedure is flawed. If I’m a successful agent, working my tail off, I don’t want to be bogged down in some slow moving complaint process. Also, if I’m complaining against an agent that I may work with one day, I may not want to rock the boat so I might let certain stuff slide. Of course I will launch a complaint if it is really warranted but I probably won’t if it is something minor. I think an anonymous hot line could go a long way. Good professional agents would probably be calling it all the time for things like sign infractions, tricky or misleading advertising, craiglist scammers, etc. It might force everyone to really pull up their socks. Someone makes a complaint, the inspector does a little investigation then either sets a fine or gives a warning and follows up in 6 months. Just thinking it through…
      cheers.

      Reply

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