Brian Madigan LL.B., Broker
BRMadigan@iSourceRealEstate.com

RE/MAX West Realty Inc.,
Brokerage
Independently owned and operated

96 Rexdale Blvd. 
Toronto, Ontario 


Phone: 416-745-2300
Toll Free: 1-888-507-0817

 

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Two Buyers, One Brokerage: A Strategic Alliance

October 14, 2016 - Updated: October 14, 2016

Two Buyers, One Brokerage: A Strategic Alliance

 

A Brokerage may represent two different Buyers interested in the same property.

 

Rather than a problem, this could present an opportunity.

 

Imagine this scenario, Bob has been working with Mary, his real estate professional, and Henry has been working with Marco, his real estate professional.

 

They are both looking in the same price range in the same neighbourhood. With so much competition these days, they are frequently one of many potential buyers all participating in a bidding war.

 

Mary and Marco both work for ABC Realty Inc. a large Brokerage in the area which employs 700 representatives.

 

They both are interested in submitting an Offer on Mildred’s property which she has listed through David of XYZ Realty Inc., a Brokerage with about 25 representatives.

 

David recommends that the property be listed at $899,900.00 in order to attract buyers. It’s worth one million dollars.

 

For this particular property, we have two buyers, namely Bob and Henry and if they aligned themselves strategically they might be able to successfully negotiate something to the benefit of both of them.

 

The Strategy

 

·        First, they share information.

·        They agree upon the two Offers being submitted.

·        One will clearly be higher than the other.

·        The second Offer will be accepted since it is the most attractive.

·        Then, following acceptance, the flip a coin to determine who gets the property.

 

Alternative Strategies

 

There are some possibilities here:

 

·        One Offer might be extremely low

·        Both could be very, very close, and difficult to choose

·        One Offer might contain onerous conditions

·        Another Offer might have modest conditions

·        The Buyers could decide in advance, who gets the property

 

Disclosure of Multiple Representation

 

The ability of two Buyers with the same Brokerage to “team up” is one of the reasons why the disclosure of multiple representation is required.

 

Brian Madigan LL.B., Broker

www.iSourceRealEstate.com


Tagged with: two buyers dual agency strategy multiple representation disclosure ontario law
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Brian Madigan LL.B. Broker

RE/MAX West Realty Inc. Brokerage

Independently owned and operated

96 Rexdale Blvd. , Toronto Ontario,

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