Case Study: The Imperative of Reporting All Purchase Offers
in Real Estate Transactions
In the Tokyo real estate market, the ethical and legal responsibilities of real estate agents are often tested in complex transactions.
A compelling example is a case involving the duty to report all purchase offers to a seller, even when these offers fall below the seller’s specified minimum price.
This case study provides vital insights into the professional obligations of real estate agents and the nuances of navigating client relationships.
This case study was created using an example published by the Real Estate Distribution Promotion Center, a public interest incorporated foundation.
Scenario: A Dilemma in Reporting Offers
Our real estate firm faced a challenging situation with a property listed for sale.
The seller, preparing for retirement, set a minimum sale price of 35 million yen for their 10-year-old single-family home, even though the asking price was slightly higher at 36 million yen.
The rationale was straightforward: the seller wanted to use the proceeds to partially repay the mortgage on their newly purchased condo.
The complexity arose when an offer came in at 34 million yen, facilitated by another agent.
In line with the seller’s initial instruction, we (agent) chose not to report this lower offer immediately.
This decision, made from a place of respect for the seller’s wishes, soon revealed itself to be a pivotal learning point.