Dispatches secretly films the latest tactics used by estate agents.

[Southsheff]

Exactly why in house loans should be outlawed.

And why not take it a step further and cut the estate agent out of the loop completely?

They should be a luxury service for people who have money to waste or no time. It's ridiculous that an industry with that size turnover has absolutely no regulation at all.

[Danny_Boy]

Exactly why in house loans should be outlawed.

And why not take it a step further and cut the estate agent out of the loop completely?

They should be a luxury service for people who have money to waste or no time. It's ridiculous that an industry with that size turnover has absolutely no regulation at all.

 

It is heavily regulated also please see FACEBOOKS post above as to why Estate Agents do offer a useful service to some people.

 

Not all Estate agents are bad and not all in house mortgage brokers are bad. They are there to offer a service if you do not feel they offer the service you would like you can feel free to sell your house without one and can always choose a mortgage advisor of your choice, nobody forces anyone to use an estate agent.

 

Where I worked the estate agent would not risk losing the sale to try and force someone to use their broker, they had unique selling points and reasons to use the in house advisor but it would certainly never affect whether a particular person would get the house or not.

[L00b]

Well, that would depend on whether the seller is willing to listen to your direct approach after they have signed up to an exclusive deal with an agent to negotiate on their behalf.

Not really.

 

I'm talking about making an offer to the seller direct - whether the seller then still wants to go through the EA motions or not is up to them. At least the seller knows what the offer is and who from (thereby completely negating your earlier "EAs rule which offer(s) go through or not" comments, entirely regardless of whether an in-hous mortgage hard sale is involved or not).

 

Simples enough, I'd have thought.

 

Most sellers I've ever met, and heard about from home-buying family and acquaintances, had no problem whatsoever with being made an offer directly, and (optionally) confirmed thereafter via their EA. There have been some surprises at times (i.e. for the buyer), causing some EAs to go very red-faced.

I have and do work in a regulated industry

You do? I am surprised. Can I ask which is your regulator?

 

As this admission seems very much at odds with your earlier comments about regulation (which, as you will therefore know, is extremely effective in this country at professionalising <where required> and curbing sharp practices <where existing> in relevant industries).

 

I mean, the situation you pointed out earlier ("EAs rule which offer(s) go through or not, depending on whether buyer buys into the in-house mortgage deals" comments) is as clear a conflict of interests (to the disadvantage of both the seller and the buyer) as I've seen.

 

Besides the Acts I mentioned earlier, let's have a quick recap of the UK (common-) law of Agency (which cover EAs and their clients)

An agent owes the principal a number of duties, including:

* a duty to undertake the task or tasks specified by the terms of the agency (that is, the agent must not do things that he has not been authorized by the principal to do);

* a duty to discharge his duties with care and due diligence; and

* a duty to avoid conflict of interest between the interests of the principal and his own (that is, the agent cannot engage in conduct where stands to gain a benefit for himself to the detriment of the principal).

, plus most regulatory frameworks very clearly address the issue of conflicts of interests. So...

and the standards of practice matter to me within this specific industry.

...I'm struggling to understand why comparable standards of practice would not (apparently) matter to you in the EA industry.

[FACEBOOK]

Not really.

 

I'm talking about making an offer to the seller direct - whether the seller then still wants to go through the EA motions or not is up to them. At least the seller knows what the offer is and who from (thereby completely negating your earlier "EAs rule which offer(s) go through or not" comments, entirely regardless of whether an in-hous mortgage hard sale is involved or not). Simples enough, I'd have thought.

 

How do the majority of people buy a house Loob, they decide to start looking, see a house for sale on right move or advertised somewhere. It's already with the agent and on the market. These are residential purchases we are talking about. For a variety of reasons, very few buyers are in a position to put in offers with a vendor directly. Many sellers don't want to negotiate with buyers themselves. it's a conflict of interest, why make the experience an easy one for a buyer. Buyers need to be put through stages of hell in order to offer the most money. That's how it works. As a seller, if you play nice, you're going to get less money. You can't regulate against greed where human nature can simply find a way round it which is un-noticable. How do you even get the evidence needed to prove a breach in these instances. As i said, you can't police this. Well you can try, but it won't make any difference.

[Cyclone]

They can make all the laws they like. None of which will stop estate agents bending the rules in their favour. It's naive to think otherwise. They'll just create new ways around it. You simply can't effectively police the day to day operations of all estate agents and their negotiations. Besides, wouldn't you rather know the rules of the game up front without having to guess. I'm sure those desperate to secure a property would, otherwise, they lose out. The bottom line is that if an estate agent with an exclusive listing doesn't want you to get a house, you're not getting that house, regardless of any law or regulation. That's the reality.

 

It is impossible to regulate on a day to day basis, it should be possible to regulate by exception though, ie by appropriately managing complaints and severely punishing estate agents who break the rules.

 

---------- Post added 30-10-2013 at 14:06 ----------

 

Well, that would depend on whether the seller is willing to listen to your direct approach after they have signed up to an exclusive deal with an agent to negotiate on their behalf. That's one of the services they are paying the agent for. To get the most money possible out of the buyer. No seller with a brain is going to negotiate with a buyer directly because they probably won't feel comfortable trying to screw the buyer over in person or on the phone. As a seller, you want the absolute maximum amount you can get for the property, as a buyer, you want to pay the absolute minimum or at least for a fair market price. If two or more people show interest to buy my property, I want my agent to screw these two fools so hard that their heads explode. Now, I can't do that to the nice gentleman I met showing around my house, he was a good guy.

 

I have and do work in a regulated industry and the standards of practice matter to me within this specific industry. I agree with their aims and why they are put in place. I want to abide by these rules and it's also in my interest to.

 

It's trivial to send a letter to the vendor though to inform them that you have made an offer of £x through their chosen EA and that they should have been informed of it.

 

See how much hastle the EA gets from the vendor if they discover that they aren't passing on genuine offers and see how long that 'exclusive' contract lasts now that the EA is in breach of the terms (and the law).

 

---------- Post added 30-10-2013 at 14:13 ----------

 

How do the majority of people buy a house Loob, they decide to start looking, see a house for sale on right move or advertised somewhere. It's already with the agent and on the market. These are residential purchases we are talking about. For a variety of reasons, very few buyers are in a position to put in offers with a vendor directly.

How so?

You missed a few steps out, they go to view the house, they probably meet and speak to the vendors, they may well inform them that they will be making an offer. They certainly have the address, and possibly now additional contact details.

It's no hardship at all to inform the vendor directly as well as the EA of an offer being made.

Many sellers don't want to negotiate with buyers themselves. it's a conflict of interest,

No it isn't.

why make the experience an easy one for a buyer. Buyers need to be put through stages of hell in order to offer the most money. That's how it works. As a seller, if you play nice, you're going to get less money. You can't regulate against greed where human nature can simply find a way round it which is un-noticable. How do you even get the evidence needed to prove a breach in these instances.

As the vendor I'd be very unhappy with an EA if I got an offer directly that the EA had chosen not to pass on. Unhappy enough to claim breach of contract and refuse any further payment at the least.

As i said, you can't police this. Well you can try, but it won't make any difference.

So your solution is to say that it's okay then and give it tacit approval?

[L00b]

How do the majority of people buy a house Loob, they decide to start looking, see a house for sale on right move or advertised somewhere. It's already with the agent and on the market. These are residential purchases we are talking about. For a variety of reasons, very few buyers are in a position to put in offers with a vendor directly. Many sellers don't want to negotiate with buyers themselves. it's a conflict of interest, why make the experience an easy one for a buyer. Buyers need to be put through stages of hell in order to offer the most money. That's how it works. As a seller, if you play nice, you're going to get less money. You can't regulate against greed where human nature can simply find a way round it which is un-noticable.

A lot of misplaced assumptions and outright misunderstandings in there, FB. Not really worth commenting upon any further.

How do you even get the evidence needed to prove a breach in these instances. As i said, you can't police this. Well you can try, but it won't make any difference.

Just ask any solicitor on here, how would they feel about breaching the SRA Code of Conduct 2011, to the extent that you suggest EAs are 'OK' to do.

 

While at it, ask them also how have many of their industry practices changed, since the SRA came online.

 

Which is your regulator btw?

[FACEBOOK]

It is impossible to regulate on a day to day basis, it should be possible to regulate by exception though, ie by appropriately managing complaints and severely punishing estate agents who break the rules.

 

And the irony is that the more people push for stronger regulation in this instance, the more under the counter negotiations will go. Agents will just cover their tracks far better making it even more unfair for those who don't know how to play the game. The new goal posts will be even more invisible to the untrained eye and even fewer buyers will know how to score a goal. How is anyone going to be able to prove that an agent hasn't acted within specific offer procedure guidelines without a lot of hard to get time consuming proof.

 

For example, you put in an offer at asking price, the estate agents best mate puts in an offer £15k under and gets the house. Try proving that. There are a thousand different versions of where an agent can pretty much do whatever they like and you'll only ever catch a tiny portion of them if you're lucky. Most of them couldn't care less if they were caught. Yep, I put my hands up, you got me, sorry gov. This is the real world, if an agent doesn't want you to get a house and there's more than one interested buyer, you're not getting it regardless of any regulation.

 

Regarding investment property, who do agents call first to sell their best deals to? They don't even put them on the market. It must be nice to live in such an ideal world but it won't make any difference. Greed will always win.

 

---------- Post added 30-10-2013 at 14:29 ----------

 

So your solution is to say that it's okay then and give it tacit approval?

 

I don't give it my approval, I've lost out in the past due to estate agent shenanigans but just like the millions of other people who have experienced the same, you just move on, lesson learned.

[Cyclone]

Who cares if you have to bung them a few quid. Life isn't all rainbows and moonbeams, but the masses cry foul as usual.

 

It certainly looks like you were approving of it in your first post.

 

---------- Post added 30-10-2013 at 14:51 ----------

 

And the irony is that the more people push for stronger regulation in this instance, the more under the counter negotiations will go. Agents will just cover their tracks far better making it even more unfair for those who don't know how to play the game. The new goal posts will be even more invisible to the untrained eye and even fewer buyers will know how to score a goal. How is anyone going to be able to prove that an agent hasn't acted within specific offer procedure guidelines without a lot of hard to get time consuming proof.

 

For example, you put in an offer at asking price, the estate agents best mate puts in an offer £15k under and gets the house. Try proving that.

Contact the vendor, explain that you made an offer at the asking price. Ask if they were ever presented that offer.

Bosh, estate agent and friend go to jail.

There are a thousand different versions of where an agent can pretty much do whatever they like and you'll only ever catch a tiny portion of them if you're lucky. Most of them couldn't care less if they were caught.

They would do if there was a massive fine a jail sentence waiting.

Yep, I put my hands up, you got me, sorry gov. This is the real world, if an agent doesn't want you to get a house and there's more than one interested buyer, you're not getting it regardless of any regulation.

 

Regarding investment property, who do agents call first to sell their best deals to? They don't even put them on the market. It must be nice to live in such an ideal world but it won't make any difference. Greed will always win.

 

I don't give it my approval, I've lost out in the past due to estate agent shenanigans but just like the millions of other people who have experienced the same, you just move on, lesson learned.

 

You certainly seem to be suggesting that because regulation might not be easy, it shouldn't be done at all. And you were criticising the "masses" for "crying foul", as if complaining about sharp practice is something to be ashamed of. On the contrary, simply accepting it is the thing to be ashamed of.

[FACEBOOK]

It certainly looks like you were approving of it in your first post.

 

---------- Post added 30-10-2013 at 14:51 ----------

 

Contact the vendor, explain that you made an offer at the asking price. Ask if they were ever presented that offer.

Bosh, estate agent and friend go to jail.

They would do if there was a massive fine a jail sentence waiting.

 

You certainly seem to be suggesting that because regulation might not be easy, it shouldn't be done at all. And you were criticising the "masses" for "crying foul", as if complaining about sharp practice is something to be ashamed of. On the contrary, simply accepting it is the thing to be ashamed of.

 

That comment wasn't approval, just stating the nature of the beast.

 

Disgruntled buyers have and do complain to vendors about the agents representing them. I've never heard of a scenario like that where the disgruntled buyer then went on to secure the property. And even if they did, the agent is still getting paid due to the contract of exclusivity. Want to spend time and money taking them to court in the midst of moving house and the stresses of buying or selling. Yea right. So unrealistic. The majority of people just won't do that, they've got busy hectic lives and just want it over with. And if the vendor does feel bad for a buyer and confronts the agent, all an agent has to do is tell the vendor the this particular buyer was abrasive and rude, wouldn't supply all their financials and is a flake or not in as good as position as another buyer. There are so many ways an agent can paint one buyer being better than another. This is why it's almost impossible to catch them showing bad intent, because they can easily turn it around stating they were just protecting their client which is some cases will be true. An agent can say they sent an email or a text with an offer or a letter that must have got lost in the post. You can't heavily fine or prosecute an agent because a peace of communication might have got lost in the post.

 

They do regulate the profession already, they will probably try and regulate it some more, none of which will make any difference. And only an absolute moron would start accusing an estate agent mid sale of under hand tactics when negotiating for a house. At least before you kicked off you might have had a small chance, now you've got no chance. Kick up a stink after? who cares, you still lost the house. Who has time to fight losing battles with time and money better spent elsewhere.

[Cyclone]

If I was the vendor I'd be quite happy to take the higher offered price and quite happy to tell the agent to do one for breach of contract. And I don't think I'm unusual.

I wouldn't have to take them to court, I'd stop talking to the agent, not pay them anything (certainly not a % of the sale price which is their main earner) and remove their sign. They'd be the ones who'd need to go to court, and they'd look pretty silly in that situation if they did, in clear breach of both contract and criminal law.

 

The regulatory body has both the time, money and inclination.