You may not know that in my previous life I was a real estate agent for 20+ years. Having seen (and possibly tried) every trick in the book, I can safely say that it is not uncommon for agents to distort the truth in order to secure a property sale. I’m sure this comes as no surprise to you. It’s the pressure of strict deadlines and performance targets that can sometimes lead agents to employ dishonest tactics. Unfortunately, such behaviour tarnishes the reputation of the entire real estate industry which is a big reason I left and became a Vendor Advocate.
In my opinion, I believe it comes down to the way in which agents are remunerated. Commission Only and Debit Credit structures have created an extremely competitive and toxic culture within not only the industry but also within the individual agencies these agents represent. Many will talk about how their office ‘genuinely’ works as a team, however from my experience there are very few agencies that have actually worked out an effective way to do this.
So, to help you navigate your way through any ‘questionable behaviour’ you may encounter when buying or selling, we have compiled a shortlist of the most common tactics used by real estate agents. Armed with this knowledge, you will be better equipped to recognise and navigate any deceitful practices you may encounter during your house-hunting journey.
Key Indicators When Interacting with Real Estate Agents
Over-quoting is a prevalent deception employed by real estate agents to convince property owners that their homes are worth more than they actually are. The rationale behind this strategy is simple: the higher the market estimate they give you, the better chance they have of securing your business.
While most agents strive to provide accurate property valuations, there are definitely some exceptions. To identify such instances, it is crucial to understand exactly what your home is worth by doing your own research. An agent who cannot provide you with sufficient supporting evidence such as prices of comparable properties in the area, should be cause for concern. At the end of the day, the agent is not held liable for giving you an over inflated estimate so the only thing they have to lose is their time.
So please be wary so you do not become one of the many who fall victim to an agent who promises the world, only to underdeliver and ruin any chance of you achieving top price for your home.
2. False Claims of Interested Buyers
Occasionally, real estate agents may approach homeowners and falsely claim they have a potential buyer interested in purchasing their home, even when you have no intention to sell. Much like the off-market strategy, this tactic is often employed to lure you into becoming clients of the agent. When approached with such an offer, it is important to exercise caution. The truth is, some agents have been known to bring friends or family through the property posing as buyers. The agent uses this ‘foot in the door’ approach to get you to sign up for a full sales campaign.
3. Inflexible Commission Rates
Depending on your location and market conditions at the time, there are some agents who will tell you their high commission is not negotiable. Or that you MUST take out a full page advert in the local property paper if you want them to be your selling agent.
This is another pressure tactice used by agents to ensure they receive higher commission and at the same time being promoted to future prospects for FREE. A trustworthy and honest agent should be open to discussing and negotiating the commission rate and will not force you to spend thousands on local paper advertising. Remember, everything is negotiable, and you should not accept their refusal to budge as the final answer.
4. Pressure Tactics to Expedite Offers
When buying, real estate agents may employ pressure tactics to induce you into making immediate offers on properties. By instilling a fear of missing out, agents often succeed in influencing buyers’ decisions. This pressure to make an offer becomes more apparent if you invest a significant amount of time with the agent, as they perceive time as money.
Then just when you’re almost at your budget’s limit, the agent says there is another buyer whose offer is higher than yours and the owner is considering it. This situation is quite common, however there may be times where you question the sincerity and honesty of the agent. Is there really another buyer or is this a way of getting you to bid against yourself?
Most of the time there is legitimate urgency. However quite often there is no other buyer and it’s the agent’s strategy to try and sell the property to you as there is nobody else. What do you do? The best way to test the agent’s sincerity is to ask them to respond to you in writing that they have a higher offer and ask to see a screenshot of it. Or better still if the offer is on a contract, request to see a copy of the front page.
You will soon find out whether the other buyer is real or fake, and an agent is less likely to put in writing something that is fabricated.
It is important to note that not all real estate agents engage in deceitful practices. However, certain property types or scenarios may create incentives for agents to resort to dishonesty. Agents may often lie to secure a listing and/or expedite a sale. By being aware of these potential scenarios, you will be better prepared to discern truth from falsehood.
Take the time to thoroughly research any claims made by agents regarding a property before feeling compelled to make an offer. Trust your instincts and avoid rushing into decisions. Remember, conducting thorough research and remaining vigilant will help you identify real estate agent lies and make more informed decisions.
If you would prefer to avoid the hassle of dealing with real estate agents and their tactics, engaging us as your Vendor Advocate is the best way to achieve more certainty when selling your home. Our strict agent interview process results in only the best and most trustworthy agents being recommended to you. We keep the agent honest and focused on achieving the best outcome throughout the entire sale process. Our help costs you nothing extra, so get in touch to find out more.