New York's Cooperative and Condominium Community
Not cynical at all, after 24+ years of review, interview and refinement of process we have found that the average agent is very average. However, the real issue here is perception. If you have to start creating caveats, recusal and conditions in order to try and make it appear 'correct' then you are ignoring the perception issue that you are in the middle of engineering. Transparency is part of it, but transparency loses out to perception every time. As I stated before, a well trained and knowledgeable Agent is a tremendous asset and assistance. We have found that there are many more who consider themselves to be than they actually are in practice. Selling Coops is a lot more than just listing and showing. There are potential problems with Agents that sell in the buildings they live in, so far we have run into shareholder resentment, pressure, door-stuffers (especially after a shareholder death), social issues, Agent resentment, non-resident agent assumptions and resentments, competing Agents who live in the same building. The Board can't rule out an Agent's right to work a building, that is interference in free trade etc. We just get hit with the problems 'in house' can create,e specially of the Agent is fluffing up in attempt to give the appearance of an 'unofficial exclusive right/privilege, even though none exist. There are some buildings that have given exclusive representation and listing rights to particular Agents or agencies as well. So, cynical? nope, realistic based on actual experiences over a couple of decades plus on Boards, yes.
Join the Conversation Comments (1)You've missed the point completely. You don't prohibit people from serving, you prohibit people from doing business with the corporation while they are serving. An Agent representing shareholders is, for all intents and purposes doing business with the building thru the shareholders, and profits by the approval of their work efforts. That can be viewed as collusion, self-dealing, using the friendship and working relationships with other Board members for unfair advantage in the review process, etc. There is no arm's distance relationship, no barrier, no wall. Recusal is nonsense really, as it obviates the existence of the personal relationships, and won't withstand the inherent skepticism of any affected party or the court. They can serve on a committee maybe, but on the Board while actively doing business in the Building, and inherently giving the impression, by virtue of their being a Board member that a shareholder selling will do better by using them, is an unfair, unspoken advantage. This isn't brain surgery. Appearances are a form of reality, and it automatically colors the other Board members in the process whether you like to admit it or not. Perception is always it's own special reality. There's a whole world of apt. buildings out there to make a living from, you don't need to be on a Board and do business in the same building. You can advise and consult without that. Your advice might be invaluable, but being on the Board undermines the legitimacy of the service rendered. It leaves the Board and the Agent open to a level of questioning that is both unnecessary and destructive to the level of trust the work requires from everyone. No matter how small the Coop, there will always be a few who will question it. IT's the sad side of human nature, but too often isn't off the mark either. There are enough articles on self-dealing each year in Habitat to prove that otherwise. Regardless of the pride you have in your professionalism, integrity and character, it doesn't mean that someone, wrongly, will still question it anyway, just because of perception issues. Unless there aren't enough decent, qualified people to even fill the seats, one shouldn't undermine oneself that way. It diminishes the value of your contribution, and that would be a shame and a loss to the building.
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You make a good argument, but I don't agree simply because there can be rules of recusal as well as sanctions for misuse of authority, etc. Being familiar with the difficulty in finding good board members, it seems unbusiness like to have knowledgable people on the board and not allow them to do business therin with full disclosure and recusal. We are just not going to agree on this matter and I do not want to discourage willing people from serving. Going back to something I mentioned earlier though, if your community needed to buy millions of dollars worth of widgets and a board member, being in the widget business, could save the community a great deal of money, would you refuse to do business with her also? How would you handle that situation and why would it be any different from a real estate agent?
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If you prohibit a real estate licensee from serving, who else do you prohibit? Do you make a list of acceptable and unacceptable professions for board service? This is a big red flag for discrimination lawsuits. It seems much more workable to have guidelines on actions of the board, confidentiality and disclosure agreements that are signed by all members and not determine which professions are acceptable. Are you aware that "lawful occupation" is a covered class under fair housing and might be somehow the basis for legal action against a board. It might be far fetched and then again it might not.
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