“If they do it often, it isn’t a mistake;
it’s just their behavior.” – Dr. Steve Maraboli
This week, there has been a series of reports in the media concerning real estate companies on the Mainland that encouraged agents to engage in the practice called “shadow flipping” and to think about the commissions involved rather than the best interests of their clients. Shadow flipping is real estate practice that has not been seen in Nanaimo and area, but has become quite common in parts of Vancouver as prices skyrocket beyond the income levels of residents, creating a schism between those who live and work in Vancouver and those who invest and safeguard their money in real estate, and then allow properties to sit vacant and literally rot until they are no longer livable. When a seller lists a home for sale, a buyer will immediately make an offer to purchase the home and then sell the contract of purchase to another buyer, often with the services of real estate agents willing to garner additional commissions.
One such company that has been the focus of recent investigations is New Coast Realty which has over 440 active agents in the Vancouver area. After a scathing report by the Globe and Mail, the Real Estate Council of BC stepped in and instituted several conditions for the company to continue to engage in real estate contracts. I feel that home buyers and home sellers should be more protected from what I consider to be criminal practices as a person’s home is often the largest investment they have. Any business, including real estate, that knowingly deceives, lies or outright commits fraud should not be allowed to be in business. It is that simple. For many years, I have been a strong advocate for tougher consequences for agents who “go rogue” as it impacts the public’s perception of our real estate industry.
The Province newspaper published an article yesterday that detailed several websites that are based in Shanghai that is allowing buyers overseas to view details on properties BEFORE buyers viewing listings in English on realtor.ca. Although it can be a great selling tool for home owners, home buyers should be able to access the same information regardless of language. It gives an unfair advantage to a segment of buyers and our real estate community should remain steadfast in ensuring local buyers are also protected. The website, vanfun.com, provides this service as well as emphasizing the benefit of BC homes as investment, not for immigration purposes. Currently, the Real Estate Board of Greater Vancouver is reviewing this website as they recently became aware of it.
Our McCullough Team offers narrated virtual tours in several languages, but ensure that these tours are released at the same time, and that our website – www.mmshomes.com publishes our listings when they hit MLS automatically. We certainly do not discourage out-of-town buyers to view or make an offer on our listings, but offer the same opportunities to local buyers. Often times, local buyers will see the FOR SALE sign installed and sign calls are quite common. We recently sold one of our listings to a buyer who had sold their home on the Mainland and was relocating to the Island. They saw the listing online and contacted us to arrange a viewing, and subsequently made an offer which was accepted by the seller.
After 37+ years as a real estate professional and former Director of the Northern Lights Real Estate Board in Dawson Creek, I feel that the only things you have in business is the respect and trust of others. Realtors who conduct themselves outside the accepted guidelines should lose their license to operate as a real estate professional. Simply giving a $1000 fine when these agents are earning tens of thousands of dollars in bogus dealings does not make sense. Much like a doctor who faces malpractice lawsuits, if they are found guilty of charges, they should not be allowed to practice medicine. It is as simple as that. If you send a strong message to unprofessional agents, you will see them leave the industry because they won’t be allowed to profit from their behavior any longer.
When you are considering purchasing or selling a property, ask potential agents how long they have been in the business and if they have ever had their license suspended. Ask them if they have ever been involved in a “shadow flip” and how they market to out-of-town buyers. Asking the tough questions will help steer you away from the unprofessional agents. If you are considering purchasing or selling on Vancouver Island, contact our McCullough Team and let us help get you moving in the right direction today at 250-751-1223.