Is it legal for a real estate firm to “list” a house then buy it themselves without having made the listing public or available to other realtors?

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Is it legal for a real estate firm to “list” a house then buy it themselves without having made the listing public or available to other realtors?

This practice seems to be a terrible conflict of interest as the seller is relying on the agent for pricing advice. These listings have not been available on the agency’s web page. They never even reach the market, yet when they are sold, they are shown as a sold listing by the agency.

Asked on August 18, 2012 under Real Estate Law, North Carolina

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 8 years ago | Contributor

I can surely understand your concnerns here but are you sure that the price that they list the property for is not the fair market value?  If you can prove that then you may have a case.  But if they are buying it for the FMV and the seller accepts the price then you are fine.  I would speak with another agennt and get a list of "comprables" in the area.  Good luck.


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