Should a watchdog group with no real estate expertise pronounce on policy? In Part 1 of her two-part series, Florida-California broker Cara Ameer lays out why the Consumer Federation of America’s latest report on transaction brokerage in Florida is way off.

In this two-part series, I’m taking on the Consumer Federation of America’s (CFA) report that questions whether transaction brokerage serves the interest of buyers and sellers in Florida.  In the second part, I debunk their incorrect assumptions with regards to compensation, conducting due diligence, negotiation and confidentiality. 

The Consumer Federation of America’s (CFA) latest report on Does Transaction Brokerage in Florida Serve the Interest of Home Buyers and Sellers? stated consumers were harmed by this representation of being neutral facilitators, and author Stephen Brobeck gave a host of unfounded reasons for this. 

The report also went so far as to state that consumers were overcharged by agents functioning as transaction brokers, implying that they don’t have to put forth the same effort in a transaction as a broker for a single agent would.

This report is a grossly inaccurate assessment written on behalf of an organization that has never been in the trenches practicing real estate.  The end result is a misguided interpretation of what transaction brokerage means based on reviewing MLS listings of closed sales and some armchair commentary. 

I’m not sure that MLS sheets tell the entire story other than providing surface-level data for someone who is not a licensed agent in the first place. They certainly don’t reveal the entire backstory of the transaction and the process that was involved to get to closing. 

Neither the buyers and sellers involved in these transactions nor their agents or respective brokerages were interviewed.  This is sort of like me trying to interpret medical data of which I may make some dangerous assumptions and draw inaccurate conclusions because I have zero background in the medical field.  I don’t play a doctor on television or in real life and the CFA shouldn’t be playing real estate policymaker.

As a licensed broker associate in the state of Florida who’s been practicing real estate since late 2001, I was taken aback by the CFA’s interpretation of transaction brokerage.  I should also note that I am licensed as a sales associate in the state of California, where dual agency is allowed, so long as the buyer and seller consent.  Practicing in both of these states allows me to have a unique perspective.

Unfortunately, the CFA report is one more piece of misinformation to cause doubt in an already confused public about the role of a real estate agent.  It is a shame that in a profession that so many work tirelessly in with no guarantee of a paycheck, we have to devote entire PR campaigns to continually justify our worth and existence.

What does the Florida Transaction Brokerage Notice actually say?

First, let’s review what the Florida Transaction Brokerage Notice states:

1. Dealing honestly and fairly

2. Accounting for all funds

3. Using skill, care and diligence in the transaction

4. Disclosing all known facts that materially affect the value of residential real property and are not readily observable to the BUYER

5. Presenting all offers and counteroffers in a timely manner, unless a party has previously directed the licensee otherwise in writing

6. Limited confidentiality, unless waived in writing by a party. This limited confidentiality will prevent disclosure that the SELLER will accept a price less than the asking or listed price, that the BUYER will pay a price greater than the price submitted in a written offer, of the motivation of any party for selling or buying property, that a SELLER or BUYER will agree to financing terms other than those offered, or of any other information requested by party to remain confidential; and

7. Any additional duties that are entered into by this or by separate written agreement. Limited representation means that a BUYER or SELLER is not responsible for the acts of the licensee.  Additionally, parties are giving up their rights to the undivided loyalty of the licensee. This aspect of limited representation allows a licensee to facilitate a real estate transaction by assisting both the BUYER and the SELLER, but a licensee will not work to represent one party to the detriment of the other party when acting as a transaction broker to both parties.

Although the transaction brokerage disclosure is not required to be given, many brokerages require this to be provided to buyers as part of their company policy. I should also note that the transaction brokerage notice is part of the Florida Association of Realtors (FAR) Exclusive Right of Sale Listing Agreement and that of numerous local board listing agreements that tend to model their templates after the state forms. 

Similarly, a single-agency disclosure is made part of the FAR single agency listing agreement.  Regardless, this report claims that no disclosures are given to buyers or sellers in a transaction brokerage scenario at all.

It is important to note that several of the duties that agents owe consumers are dealing honestly and fairly, accounting for all funds, limited confidentiality and the disclosure of all facts materially known and unknown.  There is nothing in this disclosure that implies an agent is not providing any representation.  In fact, what this report failed to mention is that Florida has a disclosure specifically for “No Representation” that can be given if a buyer or seller does not wish to have any representation.  This disclosure states that an agent owes the following:

Dealing honestly and fairly

Disclosing all known facts that materially affect the value of residential real property which are not readily observable to the buyer

Accounting for all funds entrusted to the licensee

No representation could be given when an agent shows a buyer a home that is a for sale by owner (FSBO) and will not be providing any representation to the seller.  Perhaps a buyer has contacted a listing agent directly about the property and does not want representation.  Maybe they have bought and sold numerous properties on their own, are an investor, or have their real estate license but are not actively practicing or have been involved in a real estate-related business such as lending or appraisal. 

Throughout my 20 years of practicing in Florida and working equally with buyers and sellers, I am not existing just to put a deal together with no advice, insight and input.  I strategize with the buyer or seller regarding the process they are about to embark on. 

This requires proactively managing all aspects of the transaction and anticipating what could go wrong, working to prevent that and staying ahead of all timelines and potential obstacles.  As part of skill, care and diligence, I strongly recommend and encourage a buyer to obtain the necessary inspections and investigations to satisfy themselves of all concerns.  I also alert the buyers to the importance of things they need to be aware of, such as shopping for insurance early in the transaction. 

When a homeowner or condominium association is involved, I assist buyers with getting their questions answered, obtaining the appropriate documents, and other information they need.  Countless transaction brokerage agents in sales I’ve been involved with have done the same thing. 

One important clarification that the CFA report makes no reference to is that in Florida, condominium documents are required to be provided to the buyer as part of a resale or new construction transaction.  If a buyer does not receive these documents, they can void the transaction with no penalty, regardless of the representation involved. 

When looking at properties, of course I advise buyers on things they should be aware of.  This is especially important when buyers are coming to Florida from out of state and are unfamiliar with the territory and what to expect.  Most arrive with little to no knowledge of flood zones, insurance requirements, hurricanes, termites and all that goes along with buying a home in a hot, humid and wet climate. The kind of construction they are likely to encounter is also important.

The way the CFA’s piece was written implies that an agent functioning as a transaction broker doesn’t provide or should not be providing any input or insight into anything but to show homes, write an offer and whatever happens, happens.  To approach things this way would be a breach of using skill, care and diligence and disclosing all facts materially known that could affect the value of residential property.  

Agent experience and insight are what really matters

No matter the kind of representation is provided, we find some agents are more skilled and thorough than others.  Just like any profession – there are clearly some that are at the top of their game and others that are average or underwhelming.  

Dealing honestly and fairly, using skill, care and diligence and disclosing all known facts to the buyer are conducive to an agent providing insight, advice and expertise.  This insight, advice and expertise are things the buyer cannot find by going on consumer websites to surf listings.  The new listing alerts don’t tell them about a new highway being built, a new school that’s going in or that the neighborhood had a lot of flooding issues during the last hurricane.  

These kinds of activities fall under the transaction broker duties described above, all of which could prevent a buyer from making a costly mistake or at least make them aware of the kinds of issues they could encounter with their property search.   Transaction brokerage does not excuse this and enable the agent to look the other way.

In part two of this piece, I’ll debunk the CFA’s interpretation of compensation, due diligence, negotiating power and confidentiality as it relates to transaction brokerage.

Want to know more? Check out part two of this two-part series.

Cara Ameer is a broker associate and global luxury agent with Coldwell Banker Vanguard Realty in Ponte Vedra Beach, Florida. You can follow her on Facebook or Twitter.

Show Comments Hide Comments
Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription