In New Jersey, a waiver is available to home sellers that allows listing brokers to bar other brokers from showing a for-sale home. This waiver provides, “The listing broker is hereby directed not to cooperate with any other broker.” The waiver also provides that exclusive properties cannot be published in any multiple listing service.
Pamela Bell, a real estate broker at Buyer’s Advisors in Bayonne, N.J., has a problem with that. Bell, who represents buyers in Northern New Jersey, said she believes this practice of using waivers to restrict access to listed homes is unfair to those buyers who are working with agents, as their agents are not permitted to show them these homes.
“Here an exclusive listing means no access to anyone else. I haven’t heard of any other state where that’s the case,” Bell said. The practice of exclusive listings is “widespread,” she said, and not specific to any one broker. “There are so many…some do it more than others.” Some companies offer a reduced commission to sellers in exchange for exclusive listings, she said.
In neighboring New York, the Department of State adopted a policy in 1999 stating that listing brokers must make properties available to buyer’s brokers whether or not the property is an exclusive listing. Bell said she plans to raise this issue with the New Jersey Real Estate Commission and the National Association of Realtors in hopes that New Jersey will revise its policy to contain a similar provision.
The New York policy does not specifically provide for any compensation to be paid to the buyer’s broker in the real estate transaction, though. Howard W. Goldson, a lawyer who wrote about New York’s policy for the Multiple Listing Service of Long Island, said in his analysis of the rule, “There is no obligation for the listing broker to in any way share their compensation with a buyer’s broker. Whether or not a listing broker does so is totally voluntary. All that the Department of State is saying is that the listing broker must make the property available to real estate brokers who represent buyers.”
Joseph Hottendorf, executive officer for the Liberty Board of Realtors Inc. in Secaucus, N.J., said there hasn’t been an “enormous increase” in the number of exclusive listings, and the growth in this type of listing is relative to the growth in standard listings. Hottendorf said that he has seen a trend in the number of exclusive, non-published listings that become general, published listings within 30-40 days.
“An enormous amount of those items are being pulled out of our (non-published) files and put into the database. That is a trend we never had before,” he said. Exclusive listings are typically used for business and investment-type properties, he added, “where they didn’t want the common public to know – they had business reasons to keep it discreet.”
Bell said that buyers might see exclusive listings on a Web site or a for-sale sign in their neighborhood, though it isn’t always obvious that the properties are exclusive. “I have to call the (listing) office,” she said. “For the buyer to call every office and say, ‘Is there an exclusive listing?’ isn’t really manageable.”
There was one instance in which Bell said she contacted the listing agent in an exclusive listing and asked to see the property. She explained to the listing agent that a buyer had signed an agency agreement with her, and that it was her duty to represent the buyer. “I have a contract with the buyer. (The buyer) can’t buy without me,” she said.
Joyce Andreoli, executive officer for the New Jersey Association of Realtors, said there are various reasons why sellers may choose exclusive listings. She suggested that sellers may not want a lot of agent traffic in their home, for example.
Andreoli and Hottendorf noted that there is a potential tradeoff, in entering into an exclusive listing agreement, that the homes may not fetch as many offers or as high a price as they may have if they were published on an MLS. The waiver itself reads, “I understand that cooperation amongst brokers produces wider exposure of my property and may result in it being sold or leased sooner and at a higher price than would be the case were my broker not to cooperate with other brokers.” But, Hottendorf said, “People still sign (the waiver),” and it’s their right.
Send tips or a Letter to the Editor to firstname.lastname@example.org or call (510) 658-9252, ext. 137.