Are real estate agents honest, do they bend the truth or are they just trying to do the job without being sued?
Sometimes I wonder why real estate agents have consistently had a bad reputation over many years.
In my experience of working for different real estate agencies I have come across the good the bad and the ugly.
But I just want to put one thing out there.
We are not just money hungry vultures looking for our next victim to sink our claws into, this is what the media would like to perceive us as.
I am not against the media as they are just looking for that one story that generates the public’s interest.
For the most of us we are regular people working a job, doing our best to be the best, in a very competitive industry.
It is normally that one rogue real estate agent that quickly gets caught out by the ATO, or fair-trading because of the impossible to cover-up paper trail.
I will admit most of us don’t have degrees and haven’t always been successful.
We have failed at many things but what we do know is real estate and people.
Some of the best real estate agents were never the best at school but found an avenue by which they could succeed
This was done by pure hard work and determination.
The paranoia of the real estate industry “please don’t sue us, we were only trying to help.”
To be quite honest a lot of us are just trying to do our job, to the best of our ability without being sued.
Today because of these rogue real estate agents, our industry is heavily regulated and we can be audited without a moment’s notice.
In fact because of the new types of lawyers out there willing to work on a “no win no fee” basis, real estate agents are even more paranoid about saying and doing the wrong thing by anyone.
Real estate agents according to the law are in a position of a “high degree of trust” (this is funny because we have been voted one of the most trusted professions).
This is why when a real estate agent that commits a criminal offence we are judged more harshly than the average person, this is called a “breach of trust”.
The more breach of this trust the more of an imprisonment for us real estate agents.
Ignorance is not a defence for us and even if we have had no previous criminal offences we will still be sentenced harshly.
The truth about real estate agents lying
When we attend our training to become a real estate agent we are told about all the laws we can be punished by and believe me there are a lot of them!
So if a real estate agent deliberately or recklessly lies for financial gain they are playing a deadly game of cat and mouse with the authorities that will eventually catch up with them.
Most agents just want to do the best job possible for buyers, sellers, landlords, and tenants.
They don’t want to be sued just as much as the next sane person.
Therefore with our extra trust the law has put on us, no real estate agent in their right mind ever wants to lie for financial gain, this is the cold hard truth about our industry.
Are agents allowed to lie about multiple offers?
This is a common issue for buyers and I came across it myself when I bought my property.
I can understand that angry and worrying thoughts, trying to find out if the real estate agent is lying about this.
On top of that, I do know of the heated discussions that happen back at home, on whether you should make a higher offer for that dream property.
I do know of dodgy real estate agents that when desperate to sell a property that they will lie about having other offers on the property.
Smarter agents would say “we have multiple interested buyers” which is not illegal to say.
We are bound by a strict code of ethics and law that is taken very seriously by Fair Trading.
If you feel as though you are being straight out lied to about other offers, I recommend you make a complaint directly to the business owner (this may not be the director, you may find them under principal).
No principle of a real estate agency wants to lose their real estate licence, and this will quickly spur them into action because it is a serious allegation to them.
If the dispute is not resolved after three attempts take your problem further up the food chain.
How to call their bluff about another offer
Some people say to hold firm, don’t look interested, don’t raise your offer and see what the agent does.
Wait for a counter offer.
Well what if that counter offer never comes and there really is a buyer?
This is how many people are gazumped.
The other buyer offered more, you lose the home and get frustrated at the agent.
What is really happening here, is the buyer has a lack of negotiation skills.
Some people justify this by saying that there are other properties out there.
Well this may be true but it may take you another six months to find that dream home.
A quick way to resolve this issue during negotiation is to purely say “are you sure there are multiple offers on this property as it is illegal for you to lie to me about this” this helps them either to correct themselves and offers them a way out (this is a great way to test the agent’s negotiation skills), or they will hold their ground and feel a bit offended.
This is exactly what happened to me and I found out there were multiple offers and it assisted me in securing the property against higher offers.
Negotiating with the seller directly good or bad?
Does it cut out the lies?
I have heard stories about buyers that have made an offer and have been frustrated over a multiple offers situation.
They have gone and door knocked the vendor/seller trying get some straight answers.
This usually ends in more anger and stress for the buyer and seller.
“Why” you ask?
Think about the situation you could be walking into;
- The sellers are annoyed that you haven’t gone through the agent and don’t consider your offer.
- They know about your offer but are insulted that it was too low for the home they love so much.
- It could be a divorcing couple and you could talk to the partner that doesn’t want to leave (especially for your lowball offer) and they can get more emotional about keeping the property
- The seller may annoy you, or one of your easily annoyed family members, with their negotiation style and you may decide not to buy because of a personality conflict.
Keep in mind there is a reason why they have hired a real estate agent.
It is usually because they don’t want to negotiate with a buyer directly or they would be selling it themselves.
What drives us real estate agents to sell properties for more?
Agents do not benefit much by getting you to raise your offer.
Let me explain, if the agents get you to raise your offer by $2000 on a $400,000 property they will only get roughly a $100 based on the average commission in the western suburbs of Sydney.
Not to mention the office they work in gets a portion of this hundred dollars.
The agent doesn’t really end up with much especially after their spouse has got a hold of the money, jokes.
Do you seriously think a real estate agent that has spent thousands of dollars on office overheads and attaining their licence over $100?
So you might be asking yourself, “What encourages the agent to make the seller more money?”
Well that is pretty simple, as our industry is very old school in its ways and reputation can make or break an agent’s business.
I can’t tell you how many people have decided to sell with Elders Toongabbie, just because they have heard from friends and family that we get the best prices for properties in our area.
It is simple as that, old-fashioned word of mouth goes a long way in a community.
Agents have a fiduciary requirement to work in the best interest of the seller, there is no hiding that.
I just wanted the set the record straight and say:
We are acutely aware that the buyers we are selling to now, will start to become our sellers over the next 12 months and beyond.
It makes no sense for us as an agent to compromise our integrity and lie to buyers, as in 12 months time those buyers would not want to sell with us.
- We are human beings that do make mistakes and do our best to make things right.
- We are not all like those rogue real estate agents you read about in the news.
- We have nothing to gain by being dishonest and it ruins our reputation/business.
- We know how emotional such a large transaction can be for families, and we do our best to help people through it emotionally.
There is nothing more satisfying than getting a phone call, from a buyer or a seller after the dust settles, and hearing that we have played a special part in making their life just that little bit better.
Not to mention all the chocolates and flowers our clients give us.
Yes, some of us make good money while we are doing it to, but people that do this job just for the money, usually don’t last that long.
Originally published at https://propertyupdate.com.au on March 2, 2018.