BIC TIP #1154: Selling a Property You Own as a Broker
Plenty of brokers invest in real estate. Maybe you are in an LLC with a few partners flipping a house, or you have a rental or two you are ready to sell. When a licensee sells property they have an interest in, Stephen Long says two things deserve attention: disclosing that you are licensed and understanding that you cannot represent a buyer on that property.
Disclosing Your License: Smart, Even If Not Required
Stephen notes that North Carolina license law does not require you to disclose that you hold a real estate license when you sell your own property. Even so, he considers it helpful to disclose.
Buyers may reasonably assume a licensee has more knowledge and experience than the average seller. Putting your license status on the table up front builds trust and heads off any later claim that something was hidden.
Owner Means No Buyer Representation
Here is the firm line. If you are the owner, or if you have even a partial ownership interest in a residential property, Stephen says you cannot represent a buyer on that property.
It is easy to see why. You cannot be working for the buyer to get the best price and terms while also standing to profit as the seller. Those interests point in opposite directions.
Let Someone Else Handle the Buyer
That does not mean the buyer goes without help. If the buyer wants representation, your firm may be able to refer them to someone else, with full disclosure of your ownership interest so everyone understands the relationships involved.
How your firm handles in-house situations like this is a question for your broker-in-charge. Get the plan in place before the property hits the market, not when the first buyer calls.
The Practical Takeaway
When you sell property you have an ownership interest in, disclose that you are licensed even though it is not required, and disclose your ownership interest. Do not represent any buyer on that residential property, even if you only own a piece of it. If a buyer needs representation, work with your broker-in-charge to refer them elsewhere with full transparency.
