Legal Question: What is a BPO?

Legal Line Question of the Week

Broker Price Opinions What is a BPO? “BPO” stands for Broker Price Opinion.  A Broker Price Opinion is  prepared by a real estate broker to provide an estimated value  of the probable selling price of a subject property where the  requesting party does not want to incur the expense of an appraisal  of the subject property.  The real estate broker determines the  probable selling price of the property by analyzing various factors,  including but not limited to comparable properties in the area.   Broker Price Opinions are generally prepared for a fee.  Recently,  the Department of State clarified that only a real estate broker  can collect a fee for preparing a BPO.  Accordingly, real estate  salespersons and associate real estate brokers cannot receive  compensation directly for preparing a BPO.  The fee for preparing  the BPO would be paid to the real estate broker and the real estate  broker, would, in turn, compensate its salesperson or associate broker. By: Neil B. Garfinkel,  REBNY Residential Counsel