Real Estate Talk:
Brokers and the lockbox

Why do many brokers leave the selling of the property to someone who does not fully know the property?

By Joseph Marovitch

A selling broker calls your listing broker and requests a visit to your condominium the listing broker represents. The listing broker says, “sure you can bring your clients to visit. The lockbox with the key is located on the front door. Please provide me with feedback after the visit.”

The selling broker enters the condominium with his/her clients, stands in the middle of the room, lets the client look around, asks if there are any questions, and they all leave. Maybe the condo sells, maybe it does not. There is no effort on the part of the listing broker to sell the property and there may have been some effort on the part of the selling broker to sell the property, but nobody knows for sure.

The person who will have the most knowledge and information regarding a property is the listing broker, the broker hired to sell the property, not the selling broker who brings the buyer to the property.

There are many reasons why a seller will use a broker to sell their home. Aside from the broker’s knowledge of contract law, their ability to market the property, navigate between the inspector, mortgage broker and notary, solve every issue that can arise and every concern the seller may have, brokers are hired for their ability to sell the property.

Selling the property means attending visits and explaining the pros of the property to potential buyers. The person who will have the most knowledge and information regarding a property is the listing broker, the broker hired to sell the property, not the selling broker who brings the buyer to the property.

Therefore, why do many brokers leave a lockbox, containing a key to the house, for the selling broker, and then leave the selling of the property to someone who does not fully know the property? There are reasons to use a lockbox such as the property is located outside the city in a remote area, vacant and contains no items of value. Other than the reason just mentioned, a broker should attend all visits and do what they were hired to do.

Features the listing broker would know are structural issues that must be explained, what services, parks, schools, and transportation are nearby. The listing broker may have knowledge of the type of neighbours living around the property. Perhaps the property has a rich history that can be explained and can make the property more interesting and appealing.

‘There are reasons to use a lockbox such as the property is located outside the city in a remote area, vacant and contains no items of value. Other than the reason just mentioned, a broker should attend all visits and do what they were hired to do.’

Then there is the security issue. Many properties in the Laurentians, which are second homes, have valuable items on the premises. Because the properties are second homes, the owner may only be there on the weekends. There are thousands of brokers in Quebec and many more buyers for each broker. Items can go missing. Theft can occur even if the listing broker attends the visit, but the risk is reduced significantly.

In a city, even if the property is vacant and empty, there is no reason the listing broker cannot attend the visit and perform a selling job.

Should you have questions or comments, please refer to the comments section at the bottom of the page. As well, to view past articles, click here.

Next article: Shopping with a broker vs. shopping without a broker

State of the market

According to the Teranet-National Bank Composite House price index, Canadian home prices rose slightly in July. However, it is also stated that the rise in prices was the lowest in 15 years. The authors of the index state this is evidence that the housing market is beginning to slow down due to the pandemic’s effect of reduced income, higher unemployment, and physical distancing.

‘There will still be property for sale and interest rates will remain low, however, the amount of property for sale will be limited as sellers will have concerns about who enters their home and where they go if they sell.’

As mentioned in past articles, there has been a boost in sales over the summer as those in need of a home purchased as soon as the market re-opened. As September approaches, it appears the rush to buy may be tapering off. There will still be properties for sale and interest rates will remain low, however, the number of property for sale will be limited as sellers will have concerns about who enters their home and where to go if they sell. For those who are selling, this is a good market to be in as long as they have another place to live lined up.

Have a good week and stay safe.

Let’s not forget that people with cancer are vulnerable too!

You are invited to keep giving to the following organizations since it’s now more important than ever to support cancer research! Click on the logos below to find out how:

Image: Andrea Fistetto via StockPholio.com

Other articles by Joseph Marovitch