What Is An Exclusive Listing?
Often times, from the outside, everyone’s perception of a realtor can seem very glamorous and sometimes, a laid-back career choice. I’m talking driving around all day in fancy cars, sporting pencil skirts and swanky suits, working flexible hours and enjoying the “splendour” of being your own boss.
Sure, I’ll admit, the promise of some of these luxuries was something that enticed me as well. But, once you actually start your career, you realize that perception is fleeting. A few years in the business can really do a number on that youthful optimism and glow. Then, you begin to develop what I like to call “spidey-senses” that can protect your clients’ best interest and help you see through the B.S. A realtor is privy to all the behind-the-scenes craziness, disorganization and misrepresentation that some agents display all the time. And, it is in these moments that we put our spidey-senses to work in full speed.
Being on the lease listing end of the transaction, in particular, is often where you experience the full-on I-can’t-believe-this-scenario-right-now-how-did-I-end-up-here type situations. One of our latest interactions was no exception.
Recently, we listed a small studio in the west end that generated a good amount of interest and elicited a strong oﬀer in the first week it went to Market. Our team initiated a thorough due-diligence process on the candidate: a mature single male in his 50’s, working in the construction industry. Sounds good right?
First, we reviewed the applicant’s full Equifax credit report – a near perfect score! Next, we did our due diligence in checking his:
Lastly, seeming like the perfect fit, both myself, the landlord, and the agent representing the tenant (the co-operating agent) confidently proceeded with the oﬀer. From here, we signed our acceptance and sent it back to the agent.
Being a vacant unit, the new tenant wanted to move in immediately. This is not uncommon in a competitive rental market. Working with the cooperating agent (who will remain nameless), we arranged for his client to meet us at the property for the key and cheque exchange. However, he instead insisted to send “his client’s assistant” to retrieve the keys from our office as his client was “very busy”. Fair enough. At this point, I began to raise suspicions but wanted to remain objective.
We agreed and within the hour, a tall, thin woman, in a scantily-clad outfit timidly walked into our office. With a confused look, she asked for the keys. When I met the young lady, I found her hesitation and apprehension to be suspect. Because of this, I asked her to confirm her name and show ID and a business card to confirm the information the cooperating agent provided to me. She presented her ID and provided the tenant’s 12 post-dated cheques, proof of insurance, and proof of hydro – all in good order. So, I handed her the keys and she drove oﬀ in a shiny new BMW 6-series.
The next day, the property closed without issue. Two days after that, I received an email from the co-operating agent stating, “my client has abruptly left the country for an emergency and needs to get out of his lease right away. Please return all of his cheques and I will give you back the keys”.
Typically, if there are any issues with a lease after close, especially of this calibre, the tenant would reach out to the landlord (ideally in advance of leaving the country) to let them know and try to find a resolve. There was no phone call, further explanation, or details on where this tenant had moved to, nor how we could reach him. We were only informed that the cooperating agent had the keys and is backing out of the agreement on his client’s behalf. At this point, our spidey senses were going oﬀ like a 12-alarm fire. I could hear the piercing bells in my ear as a beacon for suspicion. This story just did not add up!
Unable to reach the co-op agent for discussion at this point, I pow-wowed with my team and our Broker of Record. We immediately headed to the suite to ensure everything (and everyone) was okay. You can’t imagine the possible scenarios that were playing through our heads as we rushed through traﬃc to get to the property.
Assisted by the concierge, one of our courageous team leaders knocked on the door before accessing the property. Guess who answers? Standing meagerly in front of a backdrop of beer bottles and cigarette butts was the scantily clad “assistant” from the key exchange. Just from seeing the property, it was evident that this was a bait-and-switch type scenario. The true tenant voluntarily put his name on the lease for this unknown woman. We explained to the now frightened woman that she had two hours to pack her things and leave as she had no interest in the property or right to use it. In fact, her name was mentioned nowhere in the agreement or application, to which she understood and obliged.
Why was the tenant’s “assistant” living in the suite? Why did they suddenly want to get out of the lease? Because, we all knew the tenant did not just leave the country without contact.
As it turns out, the agent representing the tenant never actually showed the property to his client. Later, he also admitted his client was under the impression that it was a one-bedroom and not a studio – which is why he tried to back out of the deal after close. By failing to properly inform the client on what he was signing for, what he was agreeing to, and the consequences of breaching same, he did not protect his client’s best interest. The tenant lost their first and last month’s rent deposit. He also had to begin his search from scratch, only further losing time and money in the process.
Furthermore, by representing a client who had no intention of living in the property (whether he was aware or not) and then perpetuating a lie to get out of the agreement, broke the trust of other agents. This in turn, hinders the success of that agent’s future clients. Any agent with a similar experience in the past will automatically be suspicious about representation for future dealings. The fiduciary duty of a realtor should not apply exclusively to their respective clients, but to other agents as well. The purpose is to maintain a high quality of standards both morally and ethically.
Why did the tenant choose to put his name on a lease that he had no intention of using? And why did he allow someone else to live there without the landlord’s consent? Well, we can only surmise and draw our own conclusions. But, the truth is, we will never be certain.
Thinking on our feet and moving quickly, we successfully received vacant possession of the suite. We also negotiated with the co-operating agent to retain a reasonable sum of money in damages for the tenant’s breach of contract – all without the involvement of lawyers.
From here, the property was professionally cleaned and re-listed within 24 hours. Then, we called all the agents from the original showing to inform them of the listing availability. We elicited three new candidates by the end of the week! During this process, we included an in-person interview and required a signed waiver acknowledging having seen the property and accepting it as-is! The property is now being leased to a young designer, who is as lovely in person as he is on paper. He is so appreciative to be in the suite. After a walk-through inspection, we are thrilled to see the property being maintained wonderfully by its rightful tenant. The landlord thanked us for being so intent on delivering maximum value. And, we can now move forward knowing their property is well looked after. In the end, our client did not lose any money or pay additional fees with the quick turnover of tenants. And, with the damage concessions they received from the first fiasco, they actually made a little money too!
The truth is, when it comes to tenants, you can never be too sure. You can only perceive their application package and behaviour as indicators of whether they are good fit or not. And, you must do so without judgement and remove any emotional attachment to the vetting process. It is always a risk. But, through proper due diligence, proactiveness and sound problem-solving skills, you can minimize these situations. And, you do so while protecting all parties.
True success is hardly gauged by an agent’s fancy suit or the model of their car. Rather, it’s a measurement of how well they represent their client’s best interest. It’s a question of whether they uphold their integrity to remain morally and ethically sound.
It is so important to comport yourself with professionalism and honesty throughout every interaction. Because, being an agent isn’t about looking great on billboard or showing million dollar homes all day. It takes hard work, it takes balls, and it takes a high level of integrity. It’s all about having a core set of values to truly be successful as a realtor.
If you are considering hiring a realtor to list your next property or represent you in a future transaction, I urge you to interview them. Ask them the tough questions to ensure you have representation in your very best light.
Note: This article is based on a true story. For confidentiality purposes, information has been slightly altered, with facts changed.
This article is written by Urban enthusiast and food/travel junkie, Jessica Elizabeth Spillas. As the firm’s multi-talented Business Development Manager and Sales Representative, she is able to pair her passionate approach to buying, selling and investing in Toronto Real Estate with her flair for design and digital marketing. With this in mind, Jessica delivers unparalleled service with every interaction and works hard to keep her clients and colleagues organized and working at top-notch efficiency.