You wouldn’t represent both spouses in a divorce case, so why can a Realtor represent both the Seller and the Buyer in a home sale? Like attorneys, Realtors have a written code of ethics that is issued by the National Association of Realtors (Code of Ethics and Standard of Practice under Article 1). Unfortunately, for parties selling a property, the code of ethics for Realtors is not nearly as stringent as the ethics rules by which you, as a lawyer, abide.
Many attorneys are surprised to learn that Realtors are allowed to “double-end” deals. According to real estate industry publication Inman News, in all but eight states (Colorado being one of the 8), Realtors are allowed to represent both a buyer and seller in a transaction with fiduciary duties to both (referred to as “dual agency.”) Attorneys are precluded from this practice, and for good reason! How do you zealously advocate for two adversarial clients?!
Family law attorneys also expect that a Realtor selling the home is advocating for the highest price for their clients. We believe “the market” is deciding this price by listing the house for a value based on comparables in the area, and then allowing competitive bids from the public. However, Realtors who represent an investor as the Buyer may dissuade other competitive offers by not listing the property on the Multiple Listing Service (MLS), or placing it on the MLS with minimal photographs and information, and for only a short period. Many Realtors like representing investors because not only do they earn the entire commission on your listing, they often then represent the investor on the next sale.
You may see “For Sale” signs with Coming Soon” attached. This is a clever way a Realtor markets the property for sale before it is placed on the multiple listing service in an attempt to secure a Buyer and “double-end” the deal. There are also “pocket listings” where the property is not listed on the MLS and the Realtor markets the property to their own database to secure and represent the Buyer. This denies exposure and cooperative marketing with other Realtors.
A Certified Divorce Real Estate Expert (“CDRE”) will never exercise dual-agency in a divorce case where he or she is court-ordered to sell the property. They are “neutral” as between the two divorcing homeowners, but zealously advocate for those homeowners against a Buyer. CDRE’s are trained in lawyer’s ethics and take their fiduciary duties to the parties seriously.
© MARIE MORENO MYERS, Esq., CFLS and SHELLY JEAN JOHN, Esq., with the Divorce Real Estate Institute, Inc.
Katina Farrell, CDRE is an experienced Realtor & Managing Broker who specializes in real estate transactions, with expertise as a trained Certified Divorce Real Estate Expert and a Certified Negotiation Expert. She handles the sale of real property in family law cases as a neutral expert. To schedule a complimentary chat and discover more ways Katina can help you resolve the real estate challenges plaguing your divorce or divorce cases, call: 720-295-8848 or email: email@example.com