Fire my Agent? Agent buys deal instead of closing for client

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Fire my Agent? Agent buys deal instead of closing for client

James G.
Rental Property Investor · Member since 2020 · 32 posts · 35 votes

When I asked about the status of a deal my agent was trying to line up for me, he (to his credit) told me he and his partners just put it under contract and that he would keep looking for a deal for me.

I’m new to rental investing, but not new to buying houses/dealing with agents... and this seems off to me. Understanding that there is always competition, I believe the Agent should have notified me that he and his partners were interested in this deal from the outset.

Thoughts?

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Bruce Lynn
Real Estate Broker · Coppell, TX · Member since 2011 · 5k+ posts · 4k+ votes
5y

I'd get a different agent.  I always tell my clients, I would never buy in front of them.  Now if they don't like it, can't buy it, won't buy it, I might buy it, but I always give them the chance first.   Buying in front of a client that has either alerted you to the property or one you sent them as a potential buy, is a great way to kill that relationship.   I also ask them to tell me pretty quickly if I see a nice deal while we are there looking.  I tell them straight up if they don't want it, I probably have another investor that does.  If they want it, I don't shop it around to other investors, but if you don't and it's a deal, I want some other client to get it.

I guess it kind of depends on where you were in the process, if you have financing together.  Not sure what lining up a deal means exactly.  Had you seen the house?  Had you made an offer?   Do you have your financing in place?   How many other homes have you seen with the agent?  Have you bought other homes with the agent?  

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  • Bruce Lynn
    Real Estate Broker · Coppell, TX · Member since 2011 · 5k+ posts · 4k+ votes
    5y

    I'd get a different agent.  I always tell my clients, I would never buy in front of them.  Now if they don't like it, can't buy it, won't buy it, I might buy it, but I always give them the chance first.   Buying in front of a client that has either alerted you to the property or one you sent them as a potential buy, is a great way to kill that relationship.   I also ask them to tell me pretty quickly if I see a nice deal while we are there looking.  I tell them straight up if they don't want it, I probably have another investor that does.  If they want it, I don't shop it around to other investors, but if you don't and it's a deal, I want some other client to get it.

    I guess it kind of depends on where you were in the process, if you have financing together.  Not sure what lining up a deal means exactly.  Had you seen the house?  Had you made an offer?   Do you have your financing in place?   How many other homes have you seen with the agent?  Have you bought other homes with the agent?  

    22Reply
  • Dalyn Hazell
    Rental Property Investor · Springfield, MO · Member since 2020 · 120 posts · 96 votes
    5y

    @James G. How far along were you in the process? Had you made an offer on that property?

    If you hadn’t made an offer yet, and were just looking into the property, you may decide not to fire the agent, but just tell him/her that you want better communication in the future.

    However, if you had made an offer on the property already, then I’m sorry your agent did that to you. I would fire him/her and get a new one. An agent that doesn’t respect their fiduciary duty to serve you isn’t worth your business anyway.

    That’s the issue with agents that also invest sometimes. Some might “compete” with their clients in this hot market.

    5Reply
  • Inessa Stysis
    Real Estate Agent · Los Angeles, CA · Member since 2019 · 49 posts · 42 votes
    5y

    @James G. I would say it depends on the timeline of everything. Did you tour this property with your agent and then he wrapped it up for himself? Then yes, fire him and that could potentially be a violation of his license.

    If you didn’t have any relationship with him before and just reached out to him with an interest in this property, he wouldn’t have technically owed you the duty of loyalty but still should have said something.

    6Reply
  • James G.
    OP
    Rental Property Investor · Member since 2020 · 32 posts · 35 votes
    5y

    @Bruce Lynn

    @Dalyn Hazell

    @Inessa Stysis

    I was not far into the process. I have seen a number of properties with this agent so far. Prior to Christmas he told me about this property and that he thinks that he’s convinced the owner to sell. At that point he told me that if I couldn’t buy it that he’d have someone else lined up anyway. He went to the property and took some photos and sent them to me, indicating that after Xmas I could go and see it. This week, I asked him about it and he told me he was meeting them the next day and to give him the time to confirm if they would be selling. I waited, then asked how it went. He then called me to tell me that he and his partners bought it.

    I certainly see a failure in communication. He should have given me the full picture.

    1Reply
  • James G.
    OP
    Rental Property Investor · Member since 2020 · 32 posts · 35 votes
    5y

    @Bruce Lynn thanks

    0Reply
  • James G.
    OP
    Rental Property Investor · Member since 2020 · 32 posts · 35 votes
    5y

    @Dalyn Hazell thanks. Communication for sure.

    1Reply
  • Cody Benedetto
    Member since 2021 · 67 posts · 52 votes
    5y

    That's odd, are they typically a wholesaler? Seems like odd behavior and a quick way to build bad blood with clients. 

    2Reply
  • Joe S.Pro Member
    Investor · San Antonio · Member since 2020 · 3k+ posts · 3k+ votes
    5y
    Originally posted by @James G.:

    @Bruce Lynn

    @Dalyn Hazell

    @Inessa Stysis

    I was not far into the process. I have seen a number of properties with this agent so far. Prior to Christmas he told me about this property and that he thinks that he’s convinced the owner to sell. At that point he told me that if I couldn’t buy it that he’d have someone else lined up anyway. He went to the property and took some photos and sent them to me, indicating that after Xmas I could go and see it. This week, I asked him about it and he told me he was meeting them the next day and to give him the time to confirm if they would be selling. I waited, then asked how it went. He then called me to tell me that he and his partners bought it.

    I certainly see a failure in communication. He should have given me the full picture.

     What you’re describing is a little bit of gray area. The agent is obviously Hustling deals for himself/partners as well. In this particular instance it appeared that he would probably have made more money by  grabbing the deal himself than the commission he would make off of you. 
    Have you ever closed a deal with that agent? If you have never closed a deal with that agent he basically seen the opportunity that was good enough to bag for himself and did not leave it hanging out there for time to kill. If the agent was the one that mentioned the deal to start with it was not like you brought him the deal and then he swiped it from you. In the event you ever brought a property to an agent’s attention for you to buy and then they went and made an offer on it for themselves then I would think that would be pure rotten on their behalf. Now if you brought a property to an agents attention and they showed you the property and you did not make an offer on it and then they made an offer on it that’s a little different story. I have known people that  didn’t want to pull the trigger on a house,  but didn’t want anybody else to have it either. 

    3Reply
  • Jimmy Cantave
    Miami, FL · Member since 2015 · 154 posts · 38 votes
    5y

    Hey  sounds like a communication error or he probably flip the deal. 

    1Reply
  • James G.
    OP
    Rental Property Investor · Member since 2020 · 32 posts · 35 votes
    5y

    @Joe S. no deals yet. Where I am is pretty competitive at the moment. He brought the deal to me, but made it seem like I was the priority.

    It seems communication is the missing part.

    1Reply
  • Michael C.
    New to Real Estate · Denver · Member since 2020 · 75 posts · 81 votes
    5y

    Sounds like he was able to negotiate a really good deal and then didn’t want to give it up. 
    When he spoke to sellers they must have offered a better deal than he was expecting, then deal swaps from you to him. 

    Sounds crappy, I don’t know if I’d continue to work with him.  I usually believe there are enough people in any industry that if you burn me I’m moving on.  Unless he has something really special to offer there are 1,000 more agents waiting for your business. 

    6Reply
  • Tony Savage
    Real Estate Broker · San Diego, CA · Member since 2016 · 187 posts · 117 votes
    5y

    Your agent is very unethical, you should report him to his local Realtor Association!  Agents should always put their clients interest first, above and beyond their own interest. He could of at least partnered with you on the deal! Totally unacceptable!

    13Reply
  • Theresa HarrisPro Member
    Member since 2019 · 15k+ posts · 11k+ votes
    5y

    I wouldn't work with them.  If they wanted the deal for themselves, they should never have shown it to you.  It is clear there is a conflict of interest and he's not going to represent you properly.

    7Reply
  • Cody Benedetto
    Member since 2021 · 67 posts · 52 votes
    5y

    That's odd, are they typically a wholesaler? Seems like odd behavior and a quick way to build bad blood with clients. 

    1Reply
  • Ruth A Lewis
    Real Estate Agent · Oro Valley, AZ · Member since 2021 · 1 post · 2 votes
    5y

    @James G.

    Yes, ethically they should have told you.

    2Reply
  • Zachary Beach
    Specialist · Los Angeles, CA · Member since 2018 · 291 posts · 231 votes
    5y

    @James G.

    I’m going to be a bit harsh here. I thought I was going to say your agent was really unethical from the first part but honestly after ready what you said it sounds like (no offense) that he is a closer and you are not. You didn’t move on the deal given plenty of time and with warning from him that he had another buyer lined up if you didn’t jump. Did you want him to do nothing and lose the deal HE FOUND and you didn’t act on? If I was him to probably would have handed it a bit differently but it seems you had warning from him and choose to not act if you had asked him to write an offer or negotiate on your behalf it would be completely different and he would be very much in the wrong.

    My advice would be to jump you can’t wait for weeks to get great deals even if it is the holiday season.

    8Reply
  • James G.
    OP
    Rental Property Investor · Member since 2020 · 32 posts · 35 votes
    5y

    @Zachary Beach not harsh at all. I appreciate the different view. He is aware I’m looking to buy and am ready to pull the trigger. In this case I was under the impression that he was waiting for confirmation that the sell was willing to sell (naive of me maybe...probably). I asked a number of times for a viewing, and was told that he was confirming some things and would get back to me. When he did get back to me, he had bought it.

    2Reply
  • Brian Tome
    Attorney · Worton, MD · Member since 2014 · 274 posts · 195 votes
    5y

    Seems like you got the answer to your question and have a very well rounded assessment of your realtor's motivation/ethics.  My wife is a realtor and we have bought deals her clients passed on, or offered low on.  It is awkward, but we are very up front about it.  For example, we tell the investor that we are also interested and are willing to pay X.  If the investor is willing to pay X or more, we let them make the offer.

    It is also helpful that we are always willing to work on projects with her clients and very supportive.  Most of them are good friends as well as clients.

    4Reply
  • Steve K.
    Realtor · Boulder, CO · Member since 2016 · 3k+ posts · 5k+ votes
    5y

    @James G. Did you have an exclusive buyers agency agreement signed with the agent? If not, technically you’re a customer and not a client so there wouldn’t be the same fiduciary duty. I always give clients the first shot at any deals that come across my desk, though, whether we have an agency agreement or not as to me the relationship, my reputation, and the potential to do many more deals with somebody over time is more important than any single deal. I’ve been investing for a long time though and am still fairly new as an agent, so I’m less concerned with my own investing goals than I am about building my business up as an agent. Perhaps your agent is in a different place and is more interested in building their own portfolio than they are being an agent.

    8Reply
  • James G.
    OP
    Rental Property Investor · Member since 2020 · 32 posts · 35 votes
    5y

    @Steve K. Thanks for the points. His motivations and priorities are things I need to consider moving forward.

    0Reply
  • Russell BrazilBusiness Member
    Moderator
    Real Estate Agent · Washington, D.C. · Member since 2012 · 17k+ posts · 30k+ votes
    5y

    It sounds like he told you up front if you didnt want to buy it, hed have someone else buy it, then you waited. If you wanted it, you should have communicated, I want to see it when you go, or I want to make an offer on it....not have waited 2 weeks.  If I have a client who has been silent for a couple weeks on a property, Ive likely been shopping that property around to try to get it sold, or buying it myself too.

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    3Reply
  • James G.
    OP
    Rental Property Investor · Member since 2020 · 32 posts · 35 votes
    5y

    @Brian Tome thanks. I’m sure that being both an investor and a realtor can test one’s priorities at times. After reflecting on this and reading the comments I’ll clear things up with him

    And ensure better communication in future.

    0Reply
  • James G.
    OP
    Rental Property Investor · Member since 2020 · 32 posts · 35 votes
    5y

    @Russell Brazil I asked to see it up front. More than once in fact. He said to wait until he looked at it.

    2Reply
  • James G.
    OP
    Rental Property Investor · Member since 2020 · 32 posts · 35 votes
    5y

    @Russell Brazil I appreciate the comment though.

    0Reply
  • Alexandre Marques dos Santos
    Rental Property Investor · Member since 2020 · 215 posts · 137 votes
    5y

    @James G.

    As per what i saw it took a while to get back on the property ( xmas and only in Jan 7-8?). Then it seemed you were not interested. As you didnt show much of interest, agent did not front run you... BUT...

    He should have disclosed he also invest for himself, AND he should have disclosed PRIOR to make an offer to you, stating if you dont want to see he might have interest for himself, and ETHICALLY ask for your “permission”.

    I would not work with a guy like this.

    1Reply
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