Another reason agents come in handy.
There's an attitude out there, held by the more extreme critics of the real estate industry, that agents just gum up the works or worse. "Let the market be itself!" is their credo, although the mechanics of this unfettered marketplace are seldom if ever spelled out. Perhaps buyer and seller dealing with each other directly, without the irrelevant, pernicious and expensive interference of the agent? If so, what might this marketplace look like?
Two recent articles may give us a clue.
In a previous post, I told you about a Wall Street Journal reader nursing a grudge against her agent for having her do a "pre-listing" inspection of her home that turned up the need for a new roof. "Now he tells me I have to disclose this to buyers. Wouldn't I have been better off not knowing?" was the gist of her lament. To which the Journal's real estate reporter replied, "You betcha". Because not only is "seller ignorance means seller bliss" a fine way to sell a house, at least according to one real estate reporter, it sets the stage for a "clever" strategy I call gotcha: lull Buyer into getting emotionally and financially hooked on the house, and by the time his own inspector discovers that failing $11,000 roof, he's putty in Seller's hands. "Where do I sign to release my inspection contingency?" he mumbles, as if in a trance.
Not. Because as I pointed out, things don't work that way in the high-pressure flight-or-fight world of home buying. "Flight", as in Buyer walks. "Fight", as in Buyer gets mad and gets even. Neither is a good day for Seller. Worse yet for Seller is the buyer who doesn't do his own inspections and doesn't catch the roof, then wakes up two weeks after he moves in to find his roof leaking like a sieve. Because it's our old friend flight-or-fight again, except that this time flight isn't an option.
But at least we can say that, in the case of the WSJ reader, Seller, left to her own unsophisticated and buyer-beware but not necessarily villainous inclinations, would a) have never done a pre-listing inspection, and so b) never have found herself on the horns of a do-I-disclose-or-not dilemma. And in any case, the fact that Seller didn't know the roof was tired wouldn't necessarily have kept her out of court, because Buyer is capable of convincing himself that Seller did know, or should have known, and whether Seller did or should or didn't, Buyer is royally ticked.
Then not long ago I ran across an instance, in the September 1 issue of Inman News, in which Seller does know something that materially affects the value of her property: it's across the street from a landfill. And if the word "landfill" don't move you none, then mull over what a landfill used to be called: "the dump", or, in some circles, "the dumps". Yes, friends, Seller's house is across the street from the place where for years local residents dumped their, uh...stuff. Food scraps. Used diapers. Dead rats. And back in the day, the odd can or truckload of toxic waste.
All of which leaves Seller unmoved. "So what's the big deal?", she asks. The landfill "is not currently in operation", although "there are plans to reopen the facility". And besides, there's a "tree buffer" at the front of the landfill "so it is not apparent that it was a waste site". So everything's set for pulling a fast one on a buyer. Yet her kill-joy agent wants her to disclose the landfill anyway. "Since it is not currently in use, do you think we should disclose this to prospective buyers?"
Jeez, yet another deal-killing—or at least value-destroying—agent! What's up with these party poopers? Why can't they just let nature take its course? Don't agents, of all people, know that the real estate market is like an African watering hole, a place where the small and weak end up inside the stomachs of the large and strong? Don't agents, of all people, know that every transaction must have a winner and loser? Don't agents, of all people, know that for one side to win, the other must lose? That's what wheeling and dealing is all about. That's why I hire a wheeler-dealer agent, Seller grumbles. Cripes, I could do this better myself.
Inman's Barry Stone responds first by appealing to Seller's sense of fairness, citing the Golden Rule, as in "how would you like it if you had garbage trucks grinding up and down your street every day", and "how would you like it if your neighborhood became uninhabitable every time the wind shifted in your direction?" (Hey, I just thought of something: I wonder if that's why Seller is selling?)
Then, perhaps realizing that Seller wouldn't be asking this question if the Golden Rule guided her life, Stone asks Seller to "consider the possibility of a lawsuit from the buyers when they realize that you withheld" information. A lawsuit that could have just one result, with Seller guilty and paying Buyer's hundreds of thousands of dollars in legal fees.
When I see this kind of cagey seller thinking—when, for that matter, I read the kind of wacky skullduggery agents are accused of online, skullduggery that 99 percent of us could never even imagine, let alone execute, skullduggery, I say, that only a talented amateur rip-off could think of and seriously consider—I have to wonder what kind of Wild West Show the real estate marketplace would be without the detachment and relative sophistication most agents bring to it. My guess is it'd be the Earps and Clantons at the OK Corral all over again, but with attorneys instead of six-shooters.
What's ironic about this is that while real estate isn't the zero-sum game cagey sellers mistake it for, court is. Except that in court it's the cagey sellers who end up with zero.