Jackson Heights Life

Hello Jackson Heights Community,

I have been living in Jackson Heights for a number of years now. It's a neighborhood I wanted to live in since I first moved to NYC and started work on my Masters at Columbia. It's an amazingly vibrant community, and I love being a part of it!

From repeated conversations with friends and acquaintances around the community, I've been hearing time and time again that people are having difficulty finding and purchasing in JH, as well as selling their apartments.

This has left me puzzled.

For the past eight years, I've worked as a Real Estate Broker with the firm Cooper & Cooper.

It's a really great firm - all of the agents are articulate and well educated. I've made many life long friends through my work at the company.

While I've primarily worked in sales in both Manhattan & Brooklyn, I've recently started working with clients who are interested in Jackson Heights. The basic profile of these clients is similar. They are usually renting in Manhattan or Brooklyn and want to look in Jackson Heights to buy, as they can get more for their money here.  As a member of the community, I see this as a huge benefit and an exciting opportunity for our neighborhood to grow and improve.

However, in setting up tours to view properties in the neighborhood, I've been frustrated and displeased with the resistance by some listing agents here in Jackson Heights to work with cooperating brokers.  This is not common in most neighborhoods in New York City.  The vast majority of sales transactions in NYC are what we call a “Co-Broke”. For example, when a seller negotiates an exclusive contract with a sales agent, the commission paid to the listing broker upon completion of the sale is typically 6% of the sales price (although that can be negotiated in some cases).

In the case of most sales in NYC, that 6% commission will be split between the listing broker and the broker who brings the buyer (thus encouraging more buyers to see and bid on your property).  However, if a client comes and sees the apartment directly, with no broker representation, the listing broker is entitled to keep the entirety of that commission as the selling broker.  As you can imagine, the ability to collect the full commission on a “direct” deal (unrepresented buyer) becomes very attractive to a listing broker, but does not serve the client’s best interest at all!

As I mentioned above, in most cases interested clients looking to buy will come with their own broker, called a buyer’s broker. This agent represents them, not just helping them find an apartment, but also aiding them in negotiation, in contracts, finding a lawyer and mortgage broker, assembling the board package, etc.. The buyer’s broker will co-broke the commission with the listing agent, splitting it 50/50. So if the commission listed in the contract is 6%, the listing agent gets 3% and the buyer’s broker gets 3%.  This is also beneficial to the seller because the apartment is advertised without hesitation to the entire brokerage community, bringing more buyers to their property.  Additionally, represented buyers are often better qualified since they have been prepared and educated by the broker with whom they are working.  This reduces time lost with board turndowns, drawn out contract processes, etc.
 
If I was a seller, and I was paying a listing agent 6% of the sales price, I would be enraged that a well qualified client was unable to have representation of their own and see my property, because my agent refused to split the commission I was paying them. It does not matter that the listing agent's company splits their portion of the commission through their company. It's in fact, irrelevant. At my own company, we often have commission splits that extend between multiple agents. But we would never misrepresent our clients and/or not co-broke an apartment because of our commission split. That would be unethical and sometimes worse, illegal. 
 
That said, I understand that this is not only a “broker” issue in Jackson Heights.  I have heard of situations in which listing brokers are only offered 2-3% commission to represent an owner.  On the face of it, this seems like a great way to save some money on the sale of your home.  However, in reality this rarely benefits the seller for the same reason listed above.  If a seller is “forcing” a listing broker to accept a 2-3% commission, they are essentially ensuring that the listing broker can (and will) only show that property to unrepresented or direct purchasers.  Anyone working with a broker (which is the vast majority of buyers – especially those looking to move from one neighborhood to another) is completely shut out of the process.  You end up with lower purchase prices, more difficult deals, unqualified buyers and frustration with your representation (who’s hands are tied)..

In Jackson Heights specifically, I have been surprised to see that many brokerage firms will not co-broke with buyers agents.  As an owner, or potential buyer, this should not be allowed to continue in our community.

My hope is that this post will explain this concept of co-broking to unknowing apartment owners here in Jackson Heights.  I want to educate both brokers and sellers in order to make our neighborhood an attractive and accessible one to buyers and renters alike.

If anyone here has any questions regarding this and would like to reach out to me, please don't hesitate to!

I'm happy to be a resource and to help in any way that I can.

Best,
 
 
______________________________
Aram Bajakian
Senior Associate Broker
Cooper & Cooper Real Estate
Residential Sales & Rentals
341 West 38th Street, 10th Floor
New York, NY 10018

aram.bajakian@coopercooper.com
www.CooperCooper.com/AramBajakian

I was appalled by the listing practices here in Jackson Heights when I bought my unit.  It is such a disservice to sellers and buyers.  I wish the state would crack down on it, its an unethical business practice and should be done away with already.

I've been engaged in a discussion touching on this topic on another post:

http://www.jacksonheightslife.com/community/index.php?topic=8054.0

If it is true that some local listing brokers will not work with an outside buyer's broker, does anyone know which local brokers are doing this?

Also, what would be the advantage of doing so and does anyone have any experiences that they would like to share?

I did read Aram's initial post here and I am looking for additional viewpoints.

neigborhoods that are not transient are generally better served by brokers that are part of the community and not merely high-volume turnover specialists. areas like jackson heights, forest hills, midwood, certain parts of outer brooklyn are all places where people settle, not places where they hang out fora few years before packing up the family and moving to the 'burbs (which is the case for many parts of town).

these areas tend to attract brokers that know and live in  -- and in some cases, grew up in --the neigborhood. they take greater care, do a better job, and tend not to bring in co-brokers from other boroughs or other states. i prefer that feel. the broker i worked with on the home my ex and i owned back in the mid90s and the apartment i bought about ten years ago falls into that category and i recommend her highly. she knows the area, knows how to act as a mediator, and knows the ins and outs of the market. much better than going to mlsli and throwing darts.

I certainly can understand some of the reasons why someone would want to use a broker who lived in the area, if they had specialized knowledge of the neighborhood/buildings.

But I have some concerns about some of the sentiments expressed here. 

One, whether someone moves to Jackson Heights and decides to live here for a year, five years, ten years, or their whole life, they should be given the same opportunities to buy, rent and sell as a native. New York has always been a transient place - it's one of the things that makes it such an amazing city. Let's not discriminate against people just because of the amount of time that they choose to make this place their home.

Secondly, thinking that a broker who grew up in or has lived in the neighborhood for a long time is going to do a better job selling an apartment than someone who doesn't live in the neighborhood is, in my opinion, a bit misquided.
I've dealt with brokers from Queens representing Queens listings who were extremely professional, well informed and intelligent (and from small and large companies) and with brokers who were rude and inept (from both large and small companies). Go for the best broker, not just the broker who lives in your building, or lives in the neighborhood.

Finally, I don't really understand how a cobroker bringing in a client from Manhattan or Brooklyn or Upstate, or quite frankly, from Jupiter or Mars, is a bad thing.
When I have a listing, it's my goal to sell my client's apartment for the best price possible in the shortest amount of time. If the purchaser is qualified, and spits fire and has a green tongue, or is from Manhattan is all completely besides the point.

It's not my job to make these judgements. My job and my fiduciary responsibility to my seller is to present all offers and to make sure that as many potential buyers have access to the apartment as possible. To not do so is a disservice to my client, and ultimately to the community.

i certainly didn't mean to imply that buyers (or renters) from outside jackson heights should be discouraged from moving here -- and i apologize if it came across that way. i wasn't born here: i'm a comparative newcomer who moved here at the beginning of 1996.

i just meant that i think a local broker is usually more knowledgeable about an area -- a trait that's more useful to buyers than to sellers. i know that back in the mid 90s, i was living in astoria, and knew jackson heights a little bit better than some people, but not like the back of my hand. and after looking around with a few brokers, i soon saw a HUGE difference between those who came in from manhattan or long island with a sheaf of addresses and a ring of keys (and nothing else) and those who'd look at their ledger and say 'i'm not going to bother showing you this one because [fill in valid reason here].

does that make any sense?

 oh, and the broker i meant is michelle beaudoin. she's still around and she's great.

Hi dssjh,

I wasn't under the impression that you were against outsiders moving in. I more had a question regarding what you said here in regards to not bringing in co-brokers from other boroughs or other states:

these areas tend to attract brokers that know and live in  -- and in some cases, grew up in --the neigborhood. they take greater care, do a better job, and tend not to bring in co-brokers from other boroughs or other states.

I just don't understand how this would be beneficial.

Also, in regards to what Armen wrote about the MLS. I've noticed that many people on this board seem to be against listing on MLS and seem to be under the impression that this is a bad practice. This seems odd to me. I could understand that if listing on MLS was the only thing a broker did to market your home that this would be extremely frustrating, however if it is part of a comprehensive marketing plan, I don't see the harm in this. If anything it would be beneficial in reaching more potential buyers.

Does anyone have experience with MLS that they would like to share beyond what Armen wrote?

I have to wonder if there is misinformation out there and where it is coming from. (It's quite possible that I'm the one that is misinformed regarding MLS)

It's interesting. When I first moved to Jackson Heights 5 years ago, even though I was a broker in Manhattan and had been involved in sales deals in Jackson Heights, my knowledge of the rental market here was limited. I had just a day to find a place, so I knew that I needed to hire a broker to make sure that I would see as many places as possible and thus make the most informed decision. It was funny, being an experienced broker, hiring a broker to help me.

But I actually learned quite a bit in the process.

However, I think it's a bit different with sales.

One of the challenges for buyers in using a local broker is that they may not have initially been interested in the area that they ultimately end up in.

I've done numerous deals over the years where my clients end up in neighborhoods that they didn't initially expect. And I would also say that the vast majority of work in sales happens after the apartment has been found - in negotiating the price and contract, preparing the board package, working on securing a mortgage. If a buyer has secured a broker that they know and feel comfortable with in handling these aspects of the sale, it's unfortunate that they wouldn't be able to use their services and be represented by them due to the policies of a listing company (policies that are not in line with the vast majority of companies in the city).

So to this end, I think that when local agencies don't CO-broke, they are potentially cutting out clients who are loyal to a buyers broker that they want to work with and who may have not initially thought of the area.

I wasn't implying that I thought you were against MLS or RLS. I should have written:

Many people who comment on JH Life seem to be against MLS and seem to be under the impression that it is bad practice.

It is something I've come across frequently here and I'm curious as to what this is based on.

I think (and this is speculation on my part) it's because some brokers may ONLY list on MLS.

I imagine that's fine if you live upstate or outside of the city. But if a broker only lists on MLS in NYC, they're missing the majority of buyers.

Most buyers in NYC are looking on Streeteasy and the NYTIMES. Now my sense is that one of the reasons why listing brokers may not advertise on these sites is because of the potential for other brokers to want to bring in their buy side clients and cobroke. The vast majority of listings on the NYTIMES and Streeteasy, are being cobroked.

I know of an instance at my own company where a client in Sunnyside was trying to sell their apartment for months with a broker who was only advertising on MLS and not cobroking. When the exclusive contract with that broker ended and we took over the listing, we advertised on the NYTIMES and had contracts out in a week in a cobroke deal.