Who's to blame for overpaying?

Under no circumstances should you trust any advice your agent gives you. Sure, you can ask them for data, but you should interpret it on your own, and perhaps even do your own research (gasp!)

She would have won if they were in a lower tax bracket and being foreclosed on.

I am glad she lost so hopefully this will set some sort of standard that at some point you are incharge of you.

I bet one day some one will sue McDonalds because of their weight, Oh wait, never mind.

Hello.... You go to a real estate agent to buy house. You go to a car salesman to buy a car. You don't trust either one.

I'm not as willing to let realtors off the hook with ready-made platitudes about personal responsibility.

I haven't, and won't, follow this particular court case.

But in general, there has been a big problem in all real estate professions. They have no fiduciary duty to a buyer. But they want you to think they do.

This is highly deceptive. In other professions, we realize a stockbroker is making a commission on our investments. But he is also compelled to know his customer, bound to a certain standard of fitness in the products he recommends--by law.

Realtors, mortgage brokers, and lenders have sought to create that same air of personal dedication to their buyers. But they are only after making a sale.

I think you're going to see some very, very funny postings in this thread. Realtors will insist all the responsibility belongs to the buyer, and they are not to be found near the scene of the accident.

Those same realtors have already posted in other threads, trumpeting the invaluable expertise and guidance of an experienced buyer's broker.

Really, too, too funny.

What is funny is the fact that none of you took the time to read the post in which the jury blamed the consumer, not the agent.

Good topic! I have heard of this case before and I am interested to see what everyone has to say. As for me, I believe the buyer agent should be required to disclose comps, among other things. I realize the ultimate decision lies with the buyer, but that does not excuse the buyer agent from fulfilling his fiduciary duty. After all, such service should be included in the hefty commission percentage generally awarded.

Sorry to digress, but this is precisely why I believe there is merit in changing the compensation model for agents. Agents should get paid for the actual service provided. As a result, an agent will get more money for providing ten hours of service compared to two hours of service. Such a change would seemingly provide incentive for the seller to price realistically and buyer offer realistically. Of course, the agent could be awarded extra for getting more (selling) or less (buying).

I look forward to seeing the posts.

The jury, made of of.....people..... who have brains.....who may even own a home.....and know how to think and make an educated decision, SIDED WITH THE AGENT. 'Nuf said. Do they (the homeowners) like the house? Are they enjoying living in it? They must have liked the house to buy it. So if they live there long enough, it "should" appreciate and they'll recoup their "PERCEIVED" overpayment.

Marcus,

I suggest you get a copy of a buyer's agency contract and read it.

You are making inaccurate comments about the duties and responsibilities of a licensed profession. Agents sign legal contracts with their clients and are bound by these contracts, as are the clients.

Here are some of the important tenets that buyer's agents must adhere to are:

Confidentiality. The agent you hire to represent you will not disclose confidential information regarding motivation, price and terms, or anything else of a personal nature to the seller or seller's agent without your permission to do so.

Loyalty. The buyer's agent must work in the buyer's best interest at all times, even if it is not in the agent's personal best interest to do so.

Full disclosure. The agent you hire to represent you will fully disclose any information gained from the seller or the seller's agent that could be used by you in the transaction.

I want to sue McDonald's for overpaying. 10 pieces chicken mcnuggets cost $3.75 at Chinatown while in the northshore it costs $4.20.

This is a joke. You don't buy something and then 3 years later decided that you had overpaid. I don't think the buyer will ever win in this case unless the buyer had proof that the RE Agent deliberately lied to them about multiple offers [bidding war] on the property they bought. Thus, consequently bit $150K over the asking price.

You mean that the real estate market actually fluctuates in price!? I thought it only followed a linear upward trend, like Internet stocks. Buy ! Buy ! Buy ! Unless it’s going to go down. Don't buy if it is going to go down. Only buy if you know for sure that the price will go up. That is my advice to all the consumers out there. Otherwise, do nothing because you do not have the maturity to deal with a free market system.

I think most real estate agents are fairly worthless. That said, my immediate instinct is that this decision is right.

Unless the real estate agent actually lied (fraud) then the buyers have the obligation and responsibility to make their own decision wisely. Trusting a real estate agent in most cases is just stupid. (Note, there are excellent real estate agents out there, but I'd say its well under 5% of the total)

Again, thank you to the Globe for giving readers another opportunity to mention how much they hate real estate agents.

Keep up the great work!

I knew agents would take offense to any comments supporting the couple that filed the suit. However, how can an agent honestly say that agents should not be responsible for identifying relevant comps? If so, how far can this be stretched? Can the agent simply refuse to identify comps, even if there are 5, 7 or maybe 10 comps? Even if the comps do not support a claim either way, the couple should have been given the information. I believe any good agent would admit that they should be required to identify comps.

And Sally, the agent is governed by the agency contract AND and state laws regarding fiduciary duty, which I argue, includes identifying comps. The question is, how many comps can be omitted, if any, to avoid a breach of that duty?

The debate continues....

Sally, thanks so much for your suggestion. I've read them already.

If you are a real estate agent, I hope you are not under the impression that you operate under the same standard of fiduciary care imposed on brokers or investment advisors. If you are, I suggest you sign up for a continuing education course at Arena.

The only reason I don't support the couple is that the wife is a complete whack job!

I don't know if her interview on NBC hit YouTube, but if it did, it would be worth five minutes of your time.

If I was the buyer's agent on this one, not only would I defend myself, I'd hire 24-hour security to stand outside my home and watch out for her.

There's no debate, Eric141313422452. Yes, the buyer's agent has a responsibility to show comps. The jury presumably knew all about this, and decided that the agent had done his job, even though he didn't include that other home.

While the buyer in this case may have been a "nut case" I can't see this boding well for Realtors(r) in general. If buyers do not believe that their buyers agent is or can be held responsible for a lack of information or direction their value is severely diminished and there will be a backlash.

As it is, recently sold information is widely available for free(!) with a little research and an attorney can and should be hired to protect the buyers interest in real estate contract negotiations for much less than it costs the seller to pay the other 3% of a 6% fee anyway.

Ja,

The buyer's attorney has nothing to do with the seller's contract with their broker.

The seller contracts with their selling broker to sell the property and the commission is part of that contract. The amount of the commission agreed is paid to the seller's agent upon closing. If there was a cooperating broker for the buyer, the selling broker pays a percentage to them. If there is no cooperating broker, the seller's agent keeps the whole commission. So no one saves any money by NOT using a buyer's broker.

No real estate attorneys I know will agree to do the work of an agent. Their job in a real estate transaction is to do a title search and go over the purchase and sale agreement, which is usually drafted by the seller's attorney. The attorney doesn't help the buyer determine an offering price by drawing up comps or do any negotiating, or scheduling appointments or stay with the transaction step by step until closing. Those are the agent's jobs.

Sally said: "If there is no cooperating broker, the seller's agent keeps the whole commission. So no one saves any money by NOT using a buyer's broker."

You need to brush up on the changes that will be sweeping through your industry soon. For example, in my upcoming home purchase I will be using Redfin. They refund 2/3 of the buyer's agent fee to *me*, the buyer. That's around $12,000 I will be saving. Note that they are full-service, just not full-price.

I will, not, *ever* in my lifetime pay for a full-price (i.e. overpriced) agent. Most of my friends in my demographic (yuppie dinks in their early 30's) say the same thing. Get used to it.

Sally,

The point of the suit as I understand it, was that the agent *didn't* help the buyer determine a fair offer price and it's not the first time it's been said - rather the first time it's been in court.

You might want to speak with a few more real estate attorneys that work on behalf of buyers, because they most definitely do much more than you are presupposing. I know, I hired one and my "buyer broker" was not happy at the extra work he had her doing to protect *my* interests. Still, she did get her 3% from the sellers broker.

Again, comps are not that difficult to get with a little research and ultimately due diligence falls to the BUYER anyway. Surely you're not suggesting 3% commission is due for setting viewing appointments and driving to those houses...or are you?

Sellers broker keeps whole commission? I don't think so. Think falling commissions.

bikes2work,

Well, first, congratulations on your new home. I hope you realize you are one of the fortunate ones in life and maybe you'll use some of that money you've saved to worthy cause.

I do know about Redfin and it's a useful service for some buyers but not all. Redfin has limits: they don't work with multi-family, short sale, or FSBO properties. Amount of home tour time with a Redfin agent is very limited and is free for a while and then they charge. As in any service industry, some clients need full support and service and some are more independent. Redfin would work well for buyers who are very independent and are looking for a property within Redfin's limits.

The buyer and sellers that work with me, of any generation, do so because they want the personalized service.

Ja,

I've never heard of a real estate transaction where the seller's agency doesn't keep the entire commission if there is no co-broke. If a buyer comes in without an agent, the seller's agent becomes a duel agent or a designated agent. They then end up doing more work. And believe me they keep the whole commission!

I have heard of some agencies advertising they will take a lower commission if there is no cooperating broker but it is rare.

Also, most commissions are 5% these days not 6%. And so I get 2.5% for doing my job, setting up a custom search for my buyer, setting appointments, helping first time buyers determine what they can afford, going on tours, writing up the offer, negotiating the offer, and moving my buyer along in the process. By the way, I must split that 2.5% with my broker.........

One important service many good agents provide is to help a buyer focus on what they really want and what they really can afford. many buyers appreciate help in this area.

I think the fault lies with the buyer. You offered the price and later are pissed you paid too much??? I think buyers need to be educated that the selling broker is an agent of the seller, not the buyer. I think all Buyers should hire a "true buyers agent" to assist them and give them valid advice. As for the comment about attys helping with the offer, that never happens. They usually get the offer a day or two after it has been signed. Buyer should do their due diligence and take responsibility.

Talk about doing your due diligence...Binyamin Appelbaum didn't really do his homework before posting this. If he had, he would have included more details. Such as, the homes weren't comparable. They were comparable in square footage, but there's more to a house than that.

Reasons why the other two houses sold for less? One of them had a lap pool. A pool can decrease value because not everyone wants one, it cuts down on/replaces yard space, and is a huge liability. Also, it was a lap pool, which decreases whatever attraction is inherent in having a pool. All you can do is...laps. The other house, the owners had negotiated a 2-year leaseback.

These situations aren't comparable at all! No wonder they sold for less, and why the jury found in favor of the agent.