“Do real estate agents lie to buyers?” – one of the most asked questions when someone decides for house-hunting. The question may sound a little rude, but you deserve to know everything accurately when you are taking a significant decision in your life – buying a house. Follow us along, and you will find the answer to your question.
Before dealing with real estate agents, you need to know what kind of tasks they handle.
What Estate Agents Do
Generally, estate agents market and sell a property and get paid their commission. Besides, they also:
- Collect information about a property
- Estimate the value of a property
- Conduct viewings
- Manage negotiations
- Monitor sales as they proceed
- Liaise with solicitors
- Try getting the best price for both buyer and seller
- Deal with paperwork
How to Spot Estate Agents’ Tricks
One of your primary concerns might be how to deal with real estate agents when buying a property. But first, you have to know about the possible tricks they might be playing. Here are the most important reminders:
Getting the details out of you
Estate agents are genuinely chatty, which is actually a part of their work. But they may dig useful information out of you, such as: how much money you want to spend, or how badly you need to move. By being charming and friendly, they can make you feel as if they are on your side. But never let them know your maximum budget.
Altering the initial guide price up or down
It’s a strategy, actually not a trick, but you better be aware of this practice. An estate agent may initially post a property at a higher price than the realistic guide price to see what response is there for it. If they receive offers that are too low, they may adjust the price downwards. It will attract more bidders, which may eventually push the price back up to the original guide price (or even above it).
Encouraging a bidding war
The estate agents’ job is to try and get the highest price possible for a property. They might use various tactics to achieve this, and not all of them are fair. Exaggerating the offers from rival buyers is one of them. It will encourage you to bid higher or to get the rival buyers to raise their offer.
Giving false assurance about surveys
Surveying is one of the essential steps while buying a property because this may reveal any potential problems with the structure. And the result may affect the pricing of the property. So, to retain the amount, they will get paid as a commission; they won’t want the price to lower. An estate agent may therefore tell you that the recent surveys had found no major problems.
Inventing competitive offers
There is an even more severe trick than playing buyers off against each other- making up non-existent offers to try to raise your bid. It isn’t a common practice, but you must be aware. It can be highly unfavourable for you if it happens after your offer has been accepted because you have spent money on surveys and other procedures.
Giving you a short counter time
Properties do not sell for their initial asking price; obviously, a negotiation takes place. You make an offer, the seller counters, and then you either accept it or make another counteroffer; this is how it works. While bidding, if you put up an offer and the seller counters, you usually have a couple of days to consider the seller’s new proposal. But if the seller’s agent gives you only a few hours to counter, this is suspicious.
Offering you to use their mortgage brokers
Sometimes the real estate agents may encourage you to use the mortgage brokers they are teamed up with. They would try to prove their service as the finest. But remember, if they put excessive pressure on you to use it, they break the law.
How to Play Them
Now you know what tricks the estate agents have up to their sleeves but don’t know how to deal with them when buying? Consider the following techniques and watch out for those traps.
Keep in regular contact
Keeping regular contact is much important because you would like to be up-to-date. You can’t rely on the fact that you’ve made an impression as a genuine buyer. You need to call regularly to know what’s new.
Conduct your research
As estate agents are not the most reliable source to know everything, you have to research your own. Do homework about the amenities, transport links, recent house price sales, and whatever you want to know about the area.
Put in an offer
That’s an important thing to remember that estate agents work for the vendor and themselves, not you. Therefore, their job is to get the best possible price for the seller to receive a hefty sum. But they are obliged to pass on any offer you make. Pitch your initial offer below the guide price, but not too far below that it looks insulting. It will make the seller think that you are worth negotiating with.
Besides, you must interrogate to know complete details of the property you are going to buy. Such as:
- Why is the owner selling?
- Exactly what the sale includes?
- How long has this property been on the market?
- How many offers have there been?
- What were the prices of rejected offers?
- Has the property repeatedly changed hands?
- Can you speak directly to the sellers?
- Have any major works been conducted?
- How many viewings do you have for this property?
- When does the seller want to move out?
- What can they tell you about the local neighbourhood?
Bonus!
How to deal with estate agents when selling
You can’t consider yourself on the safer side if you are a seller. It would help if you still were careful while dealing with the estate agents. Here are some tips:
- Do your own research
- Get a range of quotes
- Ask how they will market the property
- Motivate them for the best price
- Be careful if they ask for selling you extra advertising
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