Spring has sprung and real estate “For Sale” signs are popping out of the ground like tulips! Usually a real estate “For Sale” sign is pretty straightforward and announces that a house is for sale. However, with recent market conditions, there has been a trend across the country of “For Sale” signs having a sign rider attached that says, “Coming Soon”. The “Coming Soon” rider has been a source of confusion for the public and among real estate professionals.
What’s a “Coming Soon” Listing?
A “Coming Soon” listing, in its purest form, is a listing that will be making an appearance on the market in the near future. A legitimate “Coming Soon” property is not available for showing or sale until a future date. In most cases, the seller is getting the property ready for market by completing repairs and improvements, packing, and staging. The “Coming Soon” marketing, in this case, is a legitimate advertising effort to help create the greatest amount of interest in the property in anticipation of the home’s first day on the market.
Problems occur when a broker advertises “Coming Soon” listings through the sign or other media, and the broker’s goal is to restrict showings by other real estate brokers in an attempt to represent both the selling and buying sides of a transaction. In this example, the real estate broker may not be acting in the best interests of the seller by not exposing the property to the highest number of potential buyers.
Colorado Real Estate Commission Position on “Coming Soon” Listings
As the Colorado housing market has heated up, the Colorado Real Estate Commission has started to receive inquiries and complaints about the use of “Coming Soon” listings. On June 3, 2014, the Colorado Real Estate Commission adopted Commission Position 44 (CP-44), clarifying the use of “Coming Soon” marketing.
In CP-44, it is stated that the most common complaint received by the commission was that a real estate broker provided limited exposure of a house on the open market in an effort to handle both sides of the transaction. The second most common complaint was that once the property was listed in the MLS and ready for showings, the property was already under contract.
While the real estate commission does not impose limitations on the marketing of a property for sale or lease, a broker must still comply with the license law. A broker, whether a single real estate agent or transaction broker, is required to “exercise reasonable skill and care” to protect the client. Reasonable skill and care would include a discussion and memorialization in the listing contract of advantages and disadvantages of “Coming Soon” marketing.
Inquiring on a “Coming Soon” Listing
Any time there is interest in a property that has a “Coming Soon” sign rider on it, the potential buyer or buyer agent should inquire about the status from the listing agent. Complaints arise when the property is not actually listed and there has been no specific marketing plan agreed to by the seller.
Legitimate questions to ask are:
- Is the property actually listed for sale?
- What date will showings be allowed?
- Is there a deadline to submit an offer?
- When will the seller be considering offers?
As always, be sure to consult your Realtor® and/or your real estate attorney about your specific situation regarding any questions you might have.
About Duane Duggan: Duane Duggan has been a Realtor® for RE/MAX of Boulder in Colorado since 1982 and has facilitated over 2,500 transactions over his career, the vast majority from repeat and referred clients. He has been awarded two of the highest honors bestowed by RE/MAX International: the Lifetime Achievement Award and the Circle of Legends Award. Living the life of a Realtor and being immersed in real estate led to the inception of his book, REALTOR® for Life. Also see his video podcasts about real estate topics on RE/MAX of Boulder’s YouTube channel.
For questions, email Duane at DuaneDuggan@BoulderCo.com or call 303-441-5611