Estate agents have a bad reputation. There’s the suspicion that they are a bit too smooth, and that they lure customers into a false sense of security to get the deal done. Of course there are some good estate agents out there, but as the job is to sell, naturally many will use their best sales techniques to get that home off the market – some of these murkier than others.
After the disastrous mini-Budget in September last year that sent the housing market into chaos, the future of property is uncertain. One thing you can probably count on, though, is that an estate agent will be involved.
So here, Jason*, an estate agent for 15 years working in south-east England, reveals his industry’s favourite tricks to improve chances of selling a house and getting that commission. “Senior management want figures, figures, figures. This, in turn, leads to some questionable practices,” he says.
1. Lots of interest
When selling a property we often say it has “lots of other interest”, whether it has any or not. Saying the property is in a desirable [school] catchment area – though in reality it might not be – is a good one for encouraging people. In general, estate agents tend to use a lot of half truths that are vague enough so that they’re hard to trace back and pin on the estate agent who said them.
2. Including fixtures and fittings
Upping the sale price because of fixtures and fittings is another popular one, saying: “If you come up to x price, the sellers will leave the carpets.” Buyers assume those carpets are going to be left but there’s actually no contractual need on the part of the sellers to do so. I had a seller take every light bulb in the flat on completion of the sale. I was a little embarrassed, though, as it was a friend of mine who bought it…
3. Abusing sealed bids
Sealed bids and best and final offers are always a bit of theatre put on by estate agents for the vendors and buyers, to up the tension around it all, to make the buyers want the property even more, and therefore try to increase how much money a buyer will offer.
I believe sealed bids, where potential buyers are invited to submit their offer in a sealed envelope by a particular date and time, should go straight to vendors’ solicitors because these bids can be open to abuse, and commonly are. They’re only as good or bad as the agent handling them.
I’ve heard of agents passing inside information on other bids to favoured buyers. Then those buyers can up their offer by a few hundred pounds or whatever they need to, to make sure their bid is the highest. I advise buyers to have the confidence to get in contact with the seller directly where possible, because offers can get lost and confused along the way – that’s what I’d do if I were buying a house.
4. Telling vendors they can sell for more
Deliberately overestimating the worth of a house to encourage the seller to give you the listing has long been a technique, and some agents are known for it. In a housing market where house prices are rising, you can get away with telling vendors their house will sell for more than you think it will. But if you overestimate and then there’s a correction on that price and it turns out to be worth a fair bit less, you can look pretty silly.
One agent where I worked was known for “topping” on a consistent basis, estimating £20k over the top of any comparable properties around the same area. I wouldn’t get involved, personally, in that I’d rather be honest with the vendor, and some sellers would still choose to go with me, but a lot of vendors are seduced by the promise of more money, which generally never materialises.
5. In-house mortgages
One technique that is really unethical and has never sat well with me is to make the buyer do their mortgage through the in-house advisor, so that the company gets a procuration fee from the building society or bank that the mortgage was placed with. If the buyer refuses to do this, we leave the property on the market to try and attract a buyer that will do it in-house. The seller is told that we can’t confirm their funds, as they won’t speak to our advisor.
We’ve been told from above: “There is only one house but loads of buyers.” This method is known as conditional selling [Illegal under the Estate Agents Act 1979] and it stopped happening for a while, but I’ve noticed it’s crept back in again.
*Name changed. As told to Kasia Delgado