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Real Estate Practices You Should Avoid

By Brian Kline | October 27, 2015

Both the buyer and seller face huge disadvantages when it comes to most real estate transactions. Both the seller's realtor and the buyer's realtor are professionals in the industry while the buyer and seller only get into these major transactions a few times in their entire life. There are some critical aspects of these deals that both buyers and sellers need to be aware of to protect their interests in any real estate transaction.


  1. Avoid dual agency in all cases. The buyer and the seller should never be represented by the same realtor. Nor should they be represented by two different realtors from the same office. A single realtor cannot serve two masters. There is no possible way of negotiating both the highest and lowest selling price when a realtor represents both the buyer and the seller. The natural tendency is to find the highest price the buyer is willing to pay in order to maximize the realtor's commission. Dual agency is particularly bad for the buyer.
  2. Another practice that buyers need to be aware of is realtors that only show their own listings or the listings held by their office. This is nothing more than a manipulative maneuver for the agent(s) to obtain the dual agency mention above.
  3. Pocket listings often work against the buyer and for the realtor. Pocket listings are typically marketed as a "sneak peak". The realtor enters into a deal with the seller to show the house before it's entered into the MLS. Only the listing agent and maybe other agents in the listing office are aware the property is for sale. This is another maneuver to create a dual agency scenario that buyers want to avoid.
  4. Seller's want to avoid realtors that don't market the listing as widely as possible. In today's technology age this can be nothing more that a lack of understanding of the technology available. But more often, it is an attempt to keep listing off of popular third party websites. The more a realtor can keep the listing in-house, the better the opportunity to create the dual agency opportunity. Sellers should insist the property be broadly marketed and included on third party websites sites such as, Zillow, Trulia, MSN RealEstate, Yahoo Real Estate,, and others.
  5. Open houses do more for the realtor holding it than it does for the home seller. While the realtor will sell the home to a prospect that stops by an open house (creating a dual agency scenario), the realtor is just as likely to offer showing the prospect any house that is currently for sale. Specifically, other houses listed with their agency. If a buyer is interested in making an offer they find through an open house, the buyer needs to insist the offer be presented by a realtor independent from the selling office.
  6. Referrals made by realtors and real estate attorneys. Referrals are common in the real estate industry because buyers and sellers don't typically know the right professionals to match with their cost and representation needs. These referrals might be from a realtor to an attorney. Or an attorney to a title company or any other referral. The problem with referrals is there is often a referral fee involved. That means the referral is not unbiased. The referring professional is making the referral for the fee instead of in the best interest of the client. Buyers and sellers alike should insist the realtor and attorney disclose all fees and payments he or she will receive in the transaction. And then shop around for the services they need.
  7. Standard real estate forms are designed by the industry to best serve the industry. Rather than maximizing the buyer and seller's negotiating power, the industry forms are designed to limit that ability and to close the deal as quickly as possible with the least amount of work required by the realtors involved. These are not mandatory forms. The buyer and seller can and should eliminate clauses that don't serve their needs and write in clauses that do serve their needs.

In no way is this list of bad practices intended to imply that the majority of realtors engage in bad practices. It's only intended to inform buyers and sellers of potential bad practices that exist in a high monetary transaction that consumers seldom engage in. There are many exceptions to these rules for the professional investor. Investors are professionals in the industry as well. As long as they are aware of all relationships, commissions, and fees in a transaction, investors are able to make informed decisions.

Please leave a comment if this article was helpful or if you have a question.

BioAuthor bio: Brian Kline has been investing in real estate for more than 35 years and writing about real estate investing for seven years. He also draws upon 30 plus years of business experience including 12 years as a manager at Boeing Aircraft Company. Brian currently lives at Lake Cushman, Washington. A vacation destination, a few short miles from a national forest. in the Olympic Mountains with the Pacific Ocean a couple of miles in the opposite direction.

Brian Kline has been investing in real estate for more than 30 years and writing about real estate investing for seven years with articles listed on Yahoo Finance, Benzinga, and uRBN. Brian is a regular contributor at Realty Biz News
  • 4 comments on “Real Estate Practices You Should Avoid”

    1. Unfortunately you are incorrect on most everything you wrote about. It appears you haven't worked in the industry long enough to find good reputable agents .
      Unfortunately the Internet allows just about anyone to make comments that are derogatory and unfounded. Most agents can and do serve clients fairly. And when practicing dual agency no one not even a highly intelligent person as yourself knows the bottom line price for a seller or how much a buyer would be willing to pay. If your disappointed in the industry find another avenue to express yourself. This is why people are so skeptical about sales people in general.

    2. Hi Brian - I would challenge you on your position on Pocket Listings. In practice, Realtors are not restricting it to agents in their office. Normally they do this for about a week to allow their team mates to have an opportunity to bring a qualified buyer to the table. However, generally most Realtors then start exposing their listing to their Realtor network through their various Realtor communities, including through, The Private Real Estate Agent Network. Should insufficient qualified buyers not arise after an in-brokerage and in-agent-network search, then broad exposure through the MLS is naturally the next step. There is little harm to the buyer with this process as it still exposes the home to a good number of buyers and in our experience, sellers are still getting market rate or above.

      On hand if you'd like to talk further about our experiences with agents through our network.


      James Bohan-Pitt, CEO & Founder
      HipPocket Inc. | Smart Lead Generation for Real Estate Agents™

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