Real estate agents are very useful for home owners looking to sell their property. This is especially true for those who want to make a fast house sale. Agents can locate buyers quicker, arrange viewings, give advice on financing, and even help with conveyancing. However, they work on commission. This means, they have a vested interested in your purchasing decision.
Like second-hand car salesmen, property agents will use every trick in the book to get you to make decisions that are beneficial to them and their agency – and they are good at it too! To make sure you don’t get short-changed in your next property transaction, we’ve compiled a list of things you need to look out for when dealing with agents.
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Never give the precise figure of your budget to agents, particularly if you are buying a property. Certainly never disclose the maximum amount you are willing to pay. Otherwise, every offer will start near your budget ceiling. Remember, agents have been trained to push clients to spend higher. If they are also representing the house owner, they will be getting a cut from both ways.
Regardless of how hot the property is (according to you agent), don’t panic. Even if there are multiple people attending a viewing, still don’t panic – the agent probably intentionally arranged all the viewing at the same time to create a buzz and false sense of urgency. Don’t fall for it. If the property really is such in high demand, you’re probably better off walking away rather than paying a high premium for it.
Until a sales and purchase contract is signed by both parties, either party can still pull out of a verbal agreement with no penalty. Although a small number of buyers will insist on a LockOut Agreement while they are arranging the financing to protect themselves against real or phantom counteroffers to the seller, the majority of buyers don’t.
This is why after a verbal agreement has been reached and a small deposit has been paid, real estate agents sometimes inform buyers that another buyer has submitted a higher offer and they need to match or exceed the offer. Faced with such pressure, buyers sometimes crumble and agree on a new increased price.
What they should’ve done instead is ask for written evidence of such a counter offer. Chances are, the alleged counter offer is a phantom one and the agent will claim that buyer has withdrawn the offer. It pays to be assertive, sometimes.
Agents sometimes receive under-the-table incentives from banks and contractors when house buyers apply for mortgages or use their service. As such, agents sometimes used pressure tactics to compel house buyers to use their recommended service providers. To be absolutely clear, this is illegal. Never, under any circumstances, buckle under the pressure. The wrong mortgages could cost buyers thousands of pounds extra in repayments. The wrong contractor might charge you above market rates while doing a shoddy job.