• 55°

Editorial: Realtor incentives — Concealing something?

The N.C. Real Estate commission did itself and the state’s real estate agents no favors this week when it tabled a proposal that would require agents to provide potential homebuyers with a written disclosure of any bonuses or extra incentives the seller is offering to the agent.
Most agents have nothing to conceal, but the commission’s action now makes it appear as if they do. It also makes it appear as if the commission ó composed mainly of industry professionals ó is more interested in protecting its own turf than in making sure consumers get full disclosure of information to which they are already entitled. Under existing regulations, agents are supposed to disclose any incentives beyond their conventional commission before the potential purchaser makes an offer. However, the agents or Realtors aren’t required to do so in writing, which makes it difficult to gauge compliance with the rule, as well as to enforce it.
Is there widespread abuse of the existing regulation? Probably not, although the lack of documentation makes it difficult to determine. The proposed change came about after a Charlotte Observer investigative report found that homebuilders were paying millions of dollars in bonuses to a Charlotte-area company that didn’t disclose the bonuses as required, in violation of state and federal law. In a subsequent investigation, the Real Estate Commission turned up other real estate companies that also haven’t followed the disclosure rules. The abuses appear concentrated among large homebuilders and agents in urban areas, not among the typical resales that make up the bulk of many agents’ livelihoods. Yet, as is the case with dishonest cops ó or unethical journalists ó the abuses of a few can easily spread suspicion among many. The best way to allay those suspicions is to make the process as transparent as possible.
The real estate and mortgage industries are already among the most heavily regulated areas of commerce. Even so, the recent revelation of widespread abuses in the sub-prime mortgage market, including bogus credit reports and inflated home appraisals, shows that there’s room for improvement ó and for better consumer protection. Prospective homebuyers are already jittery enough about the purchase process, without having to wonder whether an agent has a hidden incentive to steer a buyer toward a particular house or neighborhood. Although the commission backed away from the proposal, it left open the possibility of revisiting the issue in the future. That’s what it should do. Documented disclosure doesn’t just help protect consumers; it’s also helps protect all those agents who already follow the regulations and have nothing to hide.

Comments

Comments closed.

News

Man killed by deputy recalled as storyteller, jokester

News

Rowan’s Sen. Ford backs ‘Election Integrity Act’ to move up absentee ballot deadlines

Business

Salisbury earns ranking on national list of best small cities to start a business

Crime

Supreme Court makes it easier to give minors convicted of murder a life sentence

Local

Quotes of the week

Local

Salisbury Human Relations Council offering online Racial Wealth Gap Simulation

News

Bill seeking permanent daylight saving clears NC House

News

Friends describe Elizabeth City man killed by deputy

Business

With second hobbit house now complete, Cherry Treesort looks toward future expansion

College

Catawba Sports: 2021 Hall of Fame class announced

Crime

Supreme Court makes it easier to sentence minors convicted of murder to life in prison

Local

Overton dedicates tree to longtime volunteer Leon Zimmerman

Coronavirus

First dose COVID-19 vaccinations up to 24% in Rowan County

Crime

Blotter: April 22

Crime

Lawsuit: Salisbury Police, Rowan Sheriff’s Office tore woman’s shoulder during traffic stop

Business

‘Believe me, they’ll be fresh’: Patterson Farm welcomes strawberry crop

Local

City appoints more members to boards, commissions, with 9 seats left to be filled

News

Virtual play groups the new norm at Smart Start

Local

City meets in closed session to consult with attorney on two ongoing litigation cases

Education

Summit takes art out of the classroom, into the student’s home

Education

Education briefs: Gene Haas Foundation donates $12,500 to RCCC

Business

County’s restaurant grant program dishes out funding to eight local eateries

High School

High school football: Yow out as South head coach

Education

Shoutouts