Are Realtors Doing Their Due Diligence?
I haven't talked about this issue in quite some time but thought I would mention it given some research I was doing for clients on HOAs. My clients were wondering about HOAs' flexibility with a particular requirement he has. As part of the research, I placed calls to the HOAs for the communities the clients were interested in.
To identify the HOAs, I used the listing information completed by other Realtors. However, this is where the question comes in. For a handful of the properties where I looked for specific HOA name and contact information, several didn't have the information. It was then that I decided I needed to talk about this and perform a little test.
Testing in MLS
I performed two basic limited tests on property listing information.
- Test A - Chandler Real Estate - I pulled lising information for homes with Homeowners Associations from $200,000 to $225,000. The first 20 properties were reviewed.
- Test B: Scottsdale Real Estate - I pulled listing information for homes with Homeowners Associations from $800,000 to $900,000. The first 20 properties were reviewed. I went higher in price here based on an assumption that Realtors would take more time with a more expensive listings than a less expensive one.
Test Results
Here are the results to the testing:
- Test A: Of the 20 properties, 60% or 12 Chandler homes lacked the HOA name and contact information on the listing.
- Test B: Of the 20 properties, 40% or 8 Scottsdale homes lacked the HOA name and contact information on the listing.
Are the Realtors Performing Their Due Diligence?
Based on this, it's clear that Realtors aren't performing the due diligence in terms of capturing correct and complete information here when listing a home. The testing results lead into other questions.
If Realtors are indicating what is covered by the Homeowners Associations as part of the fees paid for a property they are listing, how is it they know this if they haven't even included the information in the listing itself?
Taking this further, if the Realtors didn't contact the HOA directly or inquire with the homeowner aside from how much they pay per month, then did the Realtor research the correct school districting information, perform room measurements, and verify all information they were indicating in the property listing?
Due Diligence is Important - The Information Has to be Right
The issue here can be summed up in terms of seriousness and professionalism. If you look at the responsibilities of a Realtor from a professional standpoint then you understand that proper due diligence is critical at all times. It's not okay to assume that the listing information is correct. To not take the steps to make sure the information here is correct begs the question as to whether other information has been missed or omitted.
It also raises the question of whether your Realtor is doing a professional job for you or not.
Due diligence is being thorough and it's critical to perform.
Just thought I would share.
By the way, if you need someone to list your home and get your HOA information correct, just Contact Us.
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