Open Letter to the real estate community regarding contingent rental listings
With the rental market getting progressively more intense in Chicago, it is time the Real Estate community paid more attention to the wild wild west of unregulated rental listings in ConnectMLS.
I would like to suggest starting by requiring agents to mark their listings as temporarily unavailable if they are refusing to show them to the public, regardless of if they have anything in writing from their prospective tenant or not.
I would add that the timeframe for marking the listing contingent should be far less than the 72 hours required for sales contracts. Given how fast the rental market moves on a regular basis - a search generally wraps in no more than a week - the timeframe should be more like 24 hours maximum to pull down a rental listing that's headed to lease.
Normally in a sales situation, once a written offer is accepted the listing can be marked as "Contingent" or "Pending" until such time as the deal closes so that other potential agents and buyers know that the property is no longer available for consideration and no longer accepting offers.
Leases can sometimes take up to a week to negotiate without anything in writing. With the rules in their current format, an agent is able to continue posting their advertisement to all of the publicly syndicated sites as a bait-and-switch tactic by keeping it valid in Connect even though they have no intention of showing it to any additional renters.
When a client has to call agent after agent only to be told that their first choice of listing has been unavailable for 6-7 days already, it is disappointing to the client and does nothing to improve the image of Realtors who are already fighting an uphill battle. Here in Chicago, Realtors who are dedicated to the rental market are surrounded by rental locator services who do not always license their agents. We are dealing with leases that often require major legal review in order to bring them in line with city ordinance. In many cases we are pushing back to legitimize rentals within offices that have never before seen them as a viable income stream. We are trying valiantly to educate our clients about the values of exclusive listings in a city fully dominated by non-exclusive and portfolio-only listings. We do not need anything or anyone working against us.
The negative effect upon the public is amplified in the rental market as so many prospective tenants are unrepresented and therefore more vulnerable to bait & switch. It makes me sad to know that the first question I will always get from a prospective tenant is "Is the property still available?"
Rental-focused Realtors are often the first introduction that many of these future home buyers and sellers have to the real estate industry. Agents working rentals are usually the newest of the new, or sometimes inexperienced in rentals despite years of practice in the sales market. They need the most guidance and support to help this next generation to understand the real estate market, but instead they're left with little enforcement, scant tools and very little supervision.
I realize that many agents make a considerable profit by leveraging this gap in the rules. However, I would encourage you to consider the best needs of the public and our mandate to provide our clients AND our customers with care and accountability.
Landlords, you can help to fix this issue by instructing the agents who represent you to take down the listing once you've accepted an application. Renters, you can help by providing earnest money with your application on the condition that the apartment be removed from all public listings for however long it takes to run the background check, draw up the lease and get it signed. Realtors, you can help by amplifying this request to MRED if you find it pertinent.
A copy of this request was sent by email to MRED, LLC, the company behind the MLS, on March 1, 2012. The response from MRED was that they would submit my request to a committee, consisting of Illinois Realtors. They did not give a timeframe for action. I have no doubt that this problem will continue to plague landlords and tenants for the next year at least. However, a greater number of voices speaking for the consumer in this situation could help to speed the process. The email address to add your voice to this request is email@example.com.
Thank you for your patience. Stay tuned for some great pointers on teaching kids to save money coming this Wednesday!