Buyers need to better understand the difference between when a selling agent is telling the truth and knowing when a property is about to be sold, recommends Australia’s largest professional body of buyer’s agents.
According to a 2018 Roy Morgan report, only 7 per cent of Australians rate real estate agents highly for their ethics and honesty.
Real Estate Buyers Agents Association (REBAA) said it was unfortunate that too many mistrusting buyers missed out on properties simply because they doubted the selling agent’s intentions.
Selling agents have a fiduciary duty to their vendor to work as hard as possible to secure the best possible result for them, within the law.
As much as buyers don’t like being thrust into a competitive situation for a property they want, the sales agent is paid by the vendor and has a primary commitment to securing the highest possible price for their client. That is their job.
“It is up to the selling agent to determine how they intend to deal with competing buyers and they reserve the right to host the competitive process in a variety of formats from ‘best and highest’ to ‘back and forth on the phone’ to a ‘boardroom auction’.”
The difference between a mistrusting buyer and an astute one was knowing when ‘bluffing’ was unlikely to be a tactic a selling agent would employ.
“Sometimes it just makes limited sense for a selling agent to bluff”
When buyers have an opportunity to buy a suitable property at a fair price, they should anticipate that good-quality property is likely to attract competition.
“Being clear about the agent’s rules, being honest about niggling trust-related doubts and requesting a specific style of negotiation are what differentiate a mistrusting buyer from an astute buyer.”
When an agent is working closely with a buyer and a colleague of theirs in the office has another buyer.
In most scenarios, the sales commission isn’t shared. The agents are in an ‘all or nothing’ position when it comes to eligibility of the sales commission component of the company revenue for that particular property sale. Each agent will hope that their respective buyer is the purchaser and will feel allegiance to their buyer. There is little reason why an agent would lie about another agent’s offer when their income is at stake.
When an offer is received before the auction.
An agent would be publicly exposed if they lied about having received an acceptable offer before the auction, because the market would then see a public auction unfold days later if the earlier claim was a bluff. If the agent had been slack with paperwork and hadn’t properly documented an offer on a contract in this instance, it is possible that the offer was genuine at the time but didn’t proceed. It would be considered bad practice to call off an auction without a formally documented and acceptable offer, so this scenario would be highly unlikely to be a bluff.
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