Featuring real estate articles and information to help real estate buyers and sellers. The Nest features writings from Georges Benoliel and other real estate professionals. Georges is the Co-Founder of NestApple and has been working as an active real estate investor for over a decade.
Are you looking for a property to purchase in NYC? Then you probably hope the real estate agent selling the property communicates honestly and fairly. But they can also try to do things to help drive the price up or to get an offer in as quickly as possible. So we’re here to clear up one thing. Whether or not realtors in NYC can lie about having multiple offers.
In short, a realtor might lie about having multiple offers. They can exaggerate the level of interest they have in a property to drive the price up. The goal is to close the deal as quickly as possible.
But doing so isn’t exactly an ethical practice. Here’s what you need to know about the legal ramifications for the realtors if they lie.
We will discuss any regulations they must operate under in New York City. We’ll also include valuable tips and tricks to help you if a realtor lies about multiple offers.
A realtor would lie about having multiple offers on a property to help get the sale done quickly. The real estate agent may tell a potential buyer a variety of things to get them to make an offer ASAP.
Or they might outright lie that they have other offers. They hope that the buyer will feel the pressure and want to make an offer quickly.
Another reason for realtors to lie on a property is to get a higher bid out of buyers, which will earn realtors a higher commission. The real estate agent’s main advantage is that the seller will accept a higher offer.
Essentially lying about multiple offers is an attempt to get the sale done and put money in the realtor’s pocket. However, the realtor is not automatically lying when they tell you multiple offers are on a property.
Sometimes it is accurate. After all, NYC real estate is highly desirable, and you would be best if you used common sense. For example, you attended a packed open house. Well, multiple buyers will likely make offers.
But let’s assume the open house was mostly empty. If the realtor claims they’ve had multiple offers in the past few days, they’re possibly lying to you. Or, at the very least, they are embellishing the truth.
Now that you know why a realtor would lie about buyer interest in a home, the next step is to figure out if they can.
New York State licensed real estate agents are technically supposed to deal in good faith and act honestly at all times. But as you can imagine, enforcing this is tough. Therefore, not all agents will follow the state guidelines.
People from all walks of life — including real estate agents — can try to take advantage of every financial opportunity they have. So it won’t always be the case that you’ll be dealing with an honest realtor.
Realtors must deal fairly and in good faith. However, NYC has no laws that prevent a realtor from lying about multiple offers on a home. NYC real estate agents don’t have to disclose any information about the offers they’ve received.
If realtors choose to disclose offer information, they can decide how much to tell. They can choose to reveal what they wish about that information.
A realtor may exaggerate the truth about how many offers they’ve received or how much interest there’s been in a home. No laws effectively prevent them from doing so, and it’s more of a morality issue than a legal one.
However, laws aren’t the only things in NYC that govern realtors and their behavior, they may also follow other regulations from their local MLS and the NAR.
As alluded to above, realtors in NYC may also have stricter regulations to abide by than just legal ones. If the agent is a New York Association of Realtors member, they must follow the Association’s regulations and the Realtor Code of Ethics. Specifically, the issue of lying to buyers does come back up, as expected, in the Realtor Code of Ethics.
The Realtor Code of Ethics states that agents must disclose offers on the property to any other broker seeking cooperation. Realtors cannot lie to or hide information from another broker who is requesting information in an attempt to cooperate on the sale. This alone is why it’s usually a good idea to employ a realtor of your own, as they ethically have to be honest with one another.
According to the Code of Ethics, realtors in NYC must disclose offers and how they were obtained to prospective buyers or cooperating brokers. But only with approval from the seller. So if a seller authorizes to release of the information, the realtor must comply and disclose the information if asked.
If the buyer’s agent does not ask for the information, realtors do not have to be forthright and disclose them independently. So if you’re looking for a home and want to be sure you know all the details, ask the questions! Once requested, the realtor must disclose the information if the seller authorizes it.
As alluded to above, agents are ethically obligated to disclose the offer information on a property if the seller has authorized it. So if they have, and you ask for the information, the agent should tell you the truth. But remember that realtors who will lie in the first place may not follow the Code of Ethics. So even though they should disclose truthful information, they may not do so.
Getting attached to a specific property is a dream for the listing agent trying to make a sale. As soon as you tell them how much you love it, they will know they’ve got you. Once your love for the property blinds you, the agent can embellish all the interest they’ve earned and how there are multiple offers on the home, and you might happily put in a higher bid right away to ensure you get it.
Don’t let the listing agent know how much you love a single property, or you might end up paying more than you had to.