Agency
A real estate agent who suggests a listing price that is unrealistically high to induce a seller to sign a listing agreement is engaging in:
APuffery, which is legally permissible
BOverpricing strategy, which is a valid negotiating tool
CIntentional misrepresentation or 'buying the listing'✓ Correct
DA legal method of maximizing seller expectations
Explanation
'Buying the listing' by suggesting an inflated price to secure a listing agreement, with no reasonable basis for that price, constitutes misrepresentation. It harms the seller by leading to extended market time, eventual price reductions, and a stigmatized listing.
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Key Terms to Know
Listing Agreement
A contract between a property owner and a real estate broker that authorizes the broker to market and sell the property.
Adjustable-Rate Mortgage (ARM)A mortgage with an interest rate that changes periodically based on a financial index, usually after an initial fixed-rate period.
AgencyA legal relationship in which a licensee (agent) acts on behalf of a principal (buyer or seller) in a real estate transaction.
Dual AgencyA situation where a single real estate agent or brokerage represents both the buyer and the seller in the same transaction.
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