Hi group. Hoping you can help. We are 2 Canadians who went to Florida to recently buy a vacation home. We looked at mostly foreclosures. The agent we had working with us told us about a home that had just come onto the market since we arrived. Our agent told us the listing agent was her friend. The price was $44,900. We viewed the home and decided to put in an offer. When we made up our offer, our agent told us there were two other offers already over asking price according to the listing agent. Based on that info, we decided to make our offer $55,000. As this was on a weekend, we were told we would find out Monday or Tuesday whether our offer was successful. We were told Tuesday our offer was not accepted but that it was "very close". After a few requests to our agent to find out what the property went for, I finally called the listing agent and asked her. She told us it sold for $55,100.

Maybe it is just a big coincidence that the winning offer was $100 over ours - but it sounds like someone pulled a fast one on us. Is this just sour grapes - if the two other offers were already submitted prior to ours (which they were) what is the likelihood that one of them was $55,100 from the beginning?

Any comments would be much appreciated. Thanks in advance.

Most likely, another buyer put an "escalation clause" into their offer. It basically says, "we'll pay $100 more than the highest offer." It sucks for you, but is entirely legal. I don't use them with my buyers, because there is no way to tell if there are really the other offers to back it up, and too many times I see buyers pay way too much for something by getting caught up in the whole Ebay effect of it all.

Not sure about Florida but in North Carolina the listing agent can reveal other offers to buyers with consent of the seller only. Not sure if it must be revealed to all byers or not but just as you describbed it does sound like the other buyer had some information that you did not have given to you. Did the listing agent tell you who the selling agent was? Could this have been double sidded by the listing agent?

I had that happen recently on one of my listings. Seller had called for highest and best offer from all parties. The two highest offers were $100 apart without any "inside" information. So yes it can happen.

I'm kind of surprised that they revealed the amount of the offer. Typically that is considered confidential until the property closes and becomes public record.
Waht you shoukd have asked is "what is the source of the accepted offer - co-broke or in house" Since Florida does not allow dual agency, both parties (buyer and seller) would have to be customers for transaction brokerage purposes if it was in-house.

You thought you were the only one with inside information. You were wrong. The listing agent had lots of friends and told them all what all the offers were, including your offer.

I don't see where you were scammed. What would have been unfair is if you were the only one being informed of what the other offers were.

To Bigtoe - and everyone else.

Thank you very much for your input. Much appreciated. To Bigtoe - knowing that there are two offers over asking isn't inside information. IMO inside information would have been knowing the amount of the other offers, so that I could plop another $100 on to seal the deal.

SPECULATION - Pure Speculation and worth absolutely nothing to you or to anyone else.

ON THE OTHER HAND Anyone contemplating buying a home in Florida, would be well advised to research not only the local market, but also the local laws governing real estate transactions and the various types of agency relationships available between an agent and a consumer or a client. (there's a distinct and legal difference)

The most favourable relationship from a buyer's point of view,would be a contractual "fiduciary relationship" that compels the agent by law to fulfill all the elements of such a relationship and one of which is to act in the "best interest" of their client (not a customer) and another element is that they owe their client undivided loyalty.

Not all agents will enter into a fiduciary relationship as the agent can be held legally liable for errors and omissions and again in the event they fail to fulfill their fiduciary duties & obligations to their client.

In order to avoid liability, the real estate industry in some jurisdictions have adopted other types of relationships under various names, but with the sole purpose and intent of enabling agents to avoid liability, one type being that of a “Transaction Broker” with apparently no fiduciary obligations to a client and therefore no liability for same.

You would be wise to consider engaging the services of a knowledgeable professional, willing to enter a fiduciary relationship by way of a written agreement binding the agent to their fiduciary obligations to the client.

There are “Buyer Brokerage Firms” that specialize in the sole representation of buyers.

Note two proverbs: "Look carefully before you leap" and "Those who act in haste, repent in sorrow".

Important Notice: This information is provided as basic educational information by the author and is not a substitute for the advice of an expert and/or the advice of a lawyer. There is NO representation as to legality, accuracy, correctness of the herein information and the reader is strongly urged to consult a lawyer in the relevant jurisdiction to ensure accuracy before acting on this information .

Were you scammed? Possibly, but not necessarily true (or even likely). Anyway, I hope that it has not deterred you from purchasing elsewhere. I know here in Maui we enjoy a high influx of Canadian buyers (strong CAD) during the winter months.

It just depends. Sometimes REO brokers are paid a set fee regardless of the selling price or doing both sides. Other times say the listing commission percentage was 6 with the REO broker paying out 1 percent of that to the asset management company that assigned them this listing. So in that case they make 2 percent off of 50k which is 1,000 but if the buyer goes directly through them they stand to make 5 percent or 3,000.

This is assuming they are the head principal broker or else they would even get less commission after splitting with their broker.
So it's possible that listing agent told their buyer to submit 100 more so they would win and the agent would make double commission.

It could also be your offer had some financing and the other buyer was all cash buying as-is and waiving inspection. There are so many variables it is hard to see. You just need to move on as there will be other deals.

good luck

Sorry 5 percent or 2,500. I just worked out so my brain is dead!

I always find these $100 over winning bids fishy, especially when I just recently got bumped for $100 and the winning bid came from the listing office......