Interesting, but not Surprising...

I just read an interesting article in the NY Times (gee, how often do I start posts like that?).  The article focused on how realtors were being sued by homebuyer that felt that they had been misled.  Agents that were supposed to be representings the purchaser were withholding information, such as what similar properties in the area were selling for, out of fear that the purchaser would back out and they would loose their commission.

I find this interesting for two reasons.  1) We saw this first hand when our knucklehead realtor tried to force us to settle on the townhouse even though there were huge HVAC issues.....  2) I work in a business that is full of these conflicts of interest.  Research Analyst's got burned big time after the internet bubble exploded for keeping buy-ratings on stocks to generate investment banking business for their firms (and HUGE bonuses for the analysts) at the sake of the "mom & pop" investors that didn't know any better and bought shares.  That make sense?

I think it will be interesting to see if these lawsuits have a large impact on the way realtors get paid.  In the case of Research Analysts, we have infinitely more disclosures and legal barriers than we did when I started in 2002.  The way that we are paid (bonuses primarily) is much more focused on servicing the client and picking stocks correctly and not directly tied to investment banking which was prone to lots of conflicts of interest.