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The potential consequences of a real estate agent hinting at a problem in the market could include causing panic among homeowners, leading them to sell their properties quickly, often at a lower price. This could result in a sudden influx of properties on the market, potentially causing a drop in property values. It could also damage the agent's reputation if their hint turns out to be false or misleading.
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Real estate agents profit from information asymmetry. They know a great deal about the housing market and also use code words to communicate with each other. They may hint that there is a problem in the market, to get owners to sell faster; or, they may use coded language in a listing to pass along information to other agents.
Asked on the following book summary:
Author Steven Levitt, working with journalist Stephen Dubner, shows how economic theories can be used to analyze social issues. Each of the six essays...
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