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Three myths about estate agents

Estate agent myths

Ah, estate agents. You gotta love them, huh? I mean, they’ve such a great reputation – almost as good as tabloid journalists (and bankers – surely les betes noires de nos jours…) However, despite their cursed habits such as telling you a property is ‘bijou’ when it’s actually a dump and that it ‘needs work’ when it’s a complete wreck; many estate agents (as with journalists and bankers no doubt) ARE well meaning. Yes, REALLY.

Perhaps it’s the wide boy image they’re given in the media, the idea that they’re always up for making a buck or two on the sly, perhaps it’s simply the fact that buying and selling property is an enormous hassle and that people automatically criticise people who are involved in the process; who knows?

Whatever the case here are three myths about estate agents busted. Yes, busted. Once and for all…

1 – Estate agents will tell you anything to make a sale

Ah, this old chestnut. Generally people seem to be under the impression that estate agents will tell buyers (and sellers) any old yarn in order to make the sale and get that commission. It’s widely believed that you shouldn’t trust everything they say and while this may have been true at one stage, these days estate agents rely a lot on word-of-mouth and repeat business as there’s a lot more competition. Plus, they are legally obliged to tell the truth – although they don’t have to reveal any information they’re not asked about. As well as this, a damning online review or news story could be disastrous for a smaller agency that’s relying on picking up new business. At the end of the day (to use a clichéd phrase) no decent agent wants an agitated client calling them up and pulling out of the deal as they’ve found something out that they previously weren’t aware of through their solicitor or the survey. Agents have a big incentive to ensure that a sale doesn’t fall through and the more they exaggerate, the less likely it will succeed. It’s in their interests to make you happy and to be as honest as they can.

And this brings us onto myth number two…

2 – Agent commission is based on sales (if only….)

You were probably unaware of this, but individual agents are rarely paid commission on securing a sale. Instead, money is actually made on getting a new property listed with them. Yes, you heard correctly. Therefore, it’s not in their interests specifically to lie to buyers, but to convince you they can sell your property quickly and effectively and that they’re the best estate agents in the area. The way they do this is by showing you history of properties they’ve sold etc and the kind of prices they’ve achieved. This means that in theory at least, they want to ensure as many sales go through as possible. However, it’s always important to remember that an individual agent is interested in doing whatever it takes to get you to commit to their property list.
Conveniently, this brings us onto point number three…

3 – The agent with the most listings is the best agent to call

It’s always tempting to go for the biggest agents, the well-known chains that always seem to get sales fast and have satisfied customers. It’s vital to remember though that you may not get the attention you deserve, as they’ll have lots of other clients to attend to. It’s true that sometimes the larger agencies put more pressure on their staff, they inevitably end up driving around here there and everywhere and may not have the time to prepare efficiently.

There are plenty more myths about estate agents, but these are three of the major ones. I bet you were surprised by number two! Another thing to add is that many people vastly over-estimate the money earned by agents and don’t really understand the way they operate. Of course, there’s no smoke without fire, you’ll always get dodgy people trying to rip you off. Just be aware though that the majority want their clients to be happy and to build their reputations off the back of this.

9 key questions to ask an estate agent when buying a house

Questions to ask an estate agent

When it comes to buying a home, it’s necessary to do your homework. Ultimately, property is a psychological game and it’s all about being more prepared than the next man or woman. Although estate agents are known to exaggerate certain issues, they’re legally bound to be honest, so they have to tell the truth if you’re trying to find out crucial information. Remember that it’s very important to try and find out as much as you can about the property you’re looking to buy, as this could save you a fortune further down the line.

Here are nine crucial, but not always obvious questions you need to ask estate agents if you want to get key information about the property you’re looking to buy:

Length of time the property’s been on the market

If the house has been on the market for more than three months, ask the agent why it’s not selling. There will be a reason it’s not, and you need to find out what that reason is. Research location, transport links, size of rooms and think about the type of person that the property would likely attract and if the property caters for this type. The bonus is that the seller may accept a lower offer if they can’t shift the property.

How long have the owners lived there for?

If the owners have only been occupying the property for a few months and are now suddenly deciding to sell, there may be a reason for that. Are the neighbours loud? Are there major works in the pipeline (this is a problem that can affect leaseholders who sometimes end up with massive bills – however your lawyers should inform you about any works due to take place in the area once you’ve put an offer in). If the owner is desperate to sell because they’re going overseas for example, you may have a better chance when it comes to getting a bargain.

Things you like, TOTALLY want to know about the property

We’ve already mentioned major works, but there are a whole host of things you’d likely want to know about the property you’re looking to buy. Is there a big negative factor that other people are aware of? A demolition nearby, a tube link set to close? These are all things to consider. Usually your solicitors should find out about these kinds of things, but it’s still worth putting tentacles out to get down with the local gossip. Why not chat to a neighbour and ask a few general questions? Or just take a drive around the area after dark to see what kind of people inhabit the local ‘hood. You should also ask if the property has frequently changed hands or not – if so, red flags should start flashing and you should DEFINITELY find out more.

What is included in the sale?

It’s important to ask what’s included in the sale. Is the shed included, for example? Fixtures and fittings? And where does the boundary lie? Also, make sure you see all of what you are getting, as often most of the contents are included.

What offers have they had so far?

If you ask the agent, he/she will probably tell you if offers have been put in, but not how much they were. If you can find out about other offers, it will be easier for you to know what you should offer. This can also save you a lot of money in the long run and the agent may be willing to give you an indication as it’s in their interests to sell the property as soon as they can.

Have the sellers found a property?

Have the sellers found another home yet; and, if they have: when do they have to move out? If they’ve got a property, they may look to sell as soon as possible. Otherwise you may be in for a wait and you need to be prepared as to how long, as ending up in a complicated chain is never a great situation.

Are you allowed to chat directly to the sellers?

Estate agents may hate this, but they can’t stop you. Sellers are often more honest and unlike the agent, they can’t pretend they don’t know the answer to questions such as when they’re moving.

Dem bills, dem bills

We all know how much bills can mount up each month. It’s therefore a good move to try to get an estimation as to how much you’ll be liable to pay each month. It may not seem important now, but council tax especially can be high and you don’t want to have any nasty surprises.

Local area

Find out as much as you can about the local neighbourhood. Transport links, crime rates, schools, are all things to take into account; you should definitely quiz the sellers about these things as they’ll likely be pretty honest about their experiences.

Remember than many of your concerns will be answered by the surveyors/solicitors – just keep an eye on their findings and probe further if you feel you want to know more about any particular issue.

 

How to work out how much you should offer when buying a property

Property offers

Recently, the media has been awash with frightening stories about ‘gazumping’ – and even ‘ghost gazumping‘ – where buyers who had their offers initially accepted were left out of pocket and pretty annoyed after the seller accepted a higher offer from someone else. The desperate shortage of property in London and the south east means that this is a problem that shows no signs of completely going away. It’s not just this that rattles would-be buyers; the prospect of having to compete against a hoard of other determined competitors is also very off-putting. And some estate agents don’t help, by ramping up the rhetoric about ‘x property being very popular – you’ll probably need to bid above the asking price’ and arranging ‘open days’ where buyers are shuffled around properties like sheep.

Unfortunately this is just part of the new reality of buying a home, and as with anything, those who do their homework have a better chance of achieving their desired result. After all, no one wants to end up paying over the odds for an average two-bed in an ok-ish suburb and run the risk of being stuck in negative equity/generally regretting the purchase further down the line.

As with many things in life, a good strategy can be to look at what everyone’s doing and do the opposite. After all, there’s going to be a ton of competition for that Victorian three-bed conveniently close to transport links and located in a pretty good part of town. Even if it’s on for a reduced price as it needs ‘updating’, don’t kid yourself; the competition will be intense (again, we’re talking especially about popular parts of London and the south east here).

It would therefore be wise to not get your hopes up too much if the competition is fierce.Think very carefully as to whether you want to play this game; there’s a good chance that you won’t win. Obviously, it depends how many people are in the running, but remember that estate agents always exaggerate (of course it depends – there are honest estate agents out there, but they’re in this industry to make cash first and foremost).
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