My house is on the market and as we have all heard, the market is generally not good. Some places in the US are doing alright and others are seriously hurting. I’d say my area is pretty much in the middle - slow but not desperate.

My realtor has not had much activity for my listing and after taking a recent seminar came to me with a recommendation.

Now, conventional wisdom says, if there has not been much activity on a listing it is one of location, price, or presentation.

One two separate “realtor tours” - where a group of realtors visit new listings to see for themselves - the consensus was a nice house that is more than they expected. I took that as good news.

However, the lack of buyer traffic means something is wrong with the three points of the triangle. Having seen the website listing for my house, I strongly feel the “presentation” is part of the problem. I took my realtor 5 weeks to clean that up. But I feel that damage has been done.

Here is the ethics question - my realtor, after having just completed the seminar, comes to me and says, “we need to create some energy around your house”. OK, I like the sound of that. He goes on to say, “We should drop the price of the house by $70,000″. I could see a $10,000 or even a $20,000 price change given the market but not $70,000. He explains, “The idea is to generate excitement and get multiple bid offers and then have the buyers bid the price back up to closer to what you expect.”

Now, I am very suspect to the idea that a number of bids will come in “instantly” from this activity and more likely we will get one or perhaps two offers below the radically lower asking price. Worse case is we get an offer *at* the asking price.

I do not believe it is ethical to list a product for a fixed price when there is no intention to actually sell if for that price. It’s false advertising and I believe it is illegal.

So, is the behavior of my realtor illegal ? Worse yet, is there a professional seminar being taught that recommends this unethical behavior ? The more I think about this situation, the more irritated I become. I also wonder what action I should or should not take.

I’ll need to work this one out for myself. I hope this is not common practice and I hope you don’t get faced with this type of behavior.

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Posted in Business, Ethics, Moving, Real Estate |

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