Estate agents play a key role in the property buying and selling process, but their integrity is often questioned. One common concern is whether estate agents can lie about offers.
It is true an estate agent can lie about offers.
Selling a property isn’t easy, and it is natural to expect that your estate agent and solicitors have put your interest first.
It is true that a great estate agent is worth their weight in gold. These are few and far between because you don’t need any qualifications to become an estate agent. According to CV Library’s research, after politicians, journalists, car salesmen and bankers, estate agents are some of the most hated professionals – in the top 10.
Sellers often question estate agents’ true intentions. Is your agent working on your side or chasing their next commission?
Can estate agents really lie about offers? Do estate agents have to pass on offers? We’ll tell you what to do if your estate agent has been lying to you.
This article will cover estate agents’ claims and provide guidance on these situations.
Table of Contents
Can estate agents lie about offers?
Yes, estate agents can lie about offers. While it is illegal for them to fabricate offers, the lack of strict regulations and qualifications in the industry makes it challenging to hold them accountable. Estate agents may lie about offers to:
- Boost their commission: By creating the illusion of multiple offers, agents can pressure buyers into increasing their bids, resulting in higher commissions for themselves.
- Create a sense of urgency: Agents may claim there are other interested buyers to prompt the seller into accepting an offer quickly, even if it’s not the best one.
- Gain an advantage: Agents might lie about offers to gain an upper hand in negotiations or to make themselves appear more effective in attracting buyers.
It is illegal for estate agents to lie about offers.
By lying to you, an estate agent can pretend that your property has lots of interest. Estate agents know that you’d have to catch them lying about an offer and prove it for them to go to jail – and even that depends on whether Police wish to prosecute.
It is against the code of conduct of the Property Ombudsman – this is the most well-respected and well-known property redress scheme that good estate agents should be a member of. Remember that this membership is voluntary.
It is likely that the Ombudsman will take several months to investigate any complaints, and even then, they might get a warning.
If an estate agent has been proven to lie, they could be expelled from the redress scheme. This doesn’t stop them from getting another job in another estate agency; for example, start a new estate agency in their wife’s name – and start again.
When a house sale falls through at the last minute, an estate agent is motivated to make up ‘fake offers’ or tell potential buyers that other parties are interested.
How to Verify the Authenticity of a Competing Offer?
To protect yourself from deceitful estate agents, follow these steps:
1. Ask for written proof
Request written documentation of the competing offer, including details like the offer amount, the buyer’s identity, and any conditions attached.
2. Speak directly to the seller’s solicitor
Contact the seller’s solicitor to gain insight into the legitimacy of the competing offer. Solicitors are bound by strict legal and professional codes, making them less likely to deceive.
3. Attend open houses
Attend open houses to gauge the level of interest in the property. If there are multiple attendees, it may indicate genuine interest, but be cautious of agents using this tactic to create a false sense of urgency.
4. Gauge market conditions
Understand the current market conditions. In a hot market, multiple offers are more likely, but in a stagnant market, a sudden surge of interest may be suspicious.
5. Check the listing’s number of days
If a property has been on the market for an extended period, it may indicate a lack of genuine interest.
Steps to Take if Suspecting Dishonesty from an Estate Agent
If you suspect an estate agent is lying about an offer:
1. Seek further details
Request more information about the competing offer, including its terms and conditions.
2. Talk with the listing agent
Engage the listing agent in conversation to gain insight into the seller’s situation and the property’s interest.
3. Report the agent to the Property Ombudsman
If you believe the agent has fabricated an offer, report them to the Property Ombudsman, who will investigate and take appropriate action.
Do estate agents lie about other offers?
Estate agents are not obligated to disclose details of other offers unless they have been rejected as too low. Be cautious of agents who refuse to provide proof of competing offers.
Estate agents often make up a phantom offer, and nobody will ever find out if there’s no evidence to catch them out.
Properties are put ‘under offer’ to give potential buyers the impression that someone has made an offer when this is not true.
If an estate agent lies to a potential buyer, he/she carries a small risk, with the benefit being that the buyer increases their offer to ‘match’ the new offer. However, an estate agent lying to a seller is more likely to be caught as you may take them up on their offer.
What to do if an estate agent lies?
The best thing is to ask your estate agent to provide you with a written offer along with proof of funds. This could be an offer along with a confirmation from a solicitor that they are acting for the buyer.
If your estate agent is reluctant to provide proof of an offer, likely, the offer doesn’t exist – and this is a phantom offer. Firstly, complaint to your estate agent and then forward it to the Property Ombudsman.
Does an estate agent have to disclose offers?
Yes, an estate agent is legally obliged to pass on all offers to the sellers in writing – even if it is below the seller’s expectation. This is to allow you the opportunity to say no.
Estate agents shouldn’t influence you if they have several offers. It is tempting for an estate agent to speak positively of a buyer using their in-house mortgage broker or solicitors who pay them a commission.
It could be that an estate agent may be “incentivised” by a buyer who wants your property because he/she wishes to live next door to their mum. An estate agent may say to him/her that he/she can secure this property at a lower price because the buyer is chain-free and hence gets double the commission.
In this case, an estate agent would influence you to accept this offer, as it results in the agent receiving a higher commission fee faster.
A buyer may ask you to withdraw property from the market or stop you from accepting other offers by signing either of these agreements:
- Lockout agreement
This involves the buyer paying a deposit to your solicitor under the condition that your property will be withdrawn from the market, giving the buyer exclusivity to purchase your property within an agreed timeframe. This is to stop any last-minute gazumping attempts.
- Goodwill agreement
A goodwill agreement is when both the seller and the buyer will put down a non-refundable deposit when an offer is accepted, and if either party were to withdraw, the other party will get to keep the deposit.
Before signing any agreements, always take independent legal advice.
Common Estate Agent Tricks
It is not just offers that estate agents lie about. These are four common lies:
| Trick | Description |
|---|---|
| Phantom Offers | Creating fake offers to pressure buyers into increasing their bids. |
| Overvaluing Properties | Inflating property values to win instructions and secure higher commissions. |
| False Viewings | Booking multiple back-to-back viewings to create the illusion of high interest. |
| Lack of Transparency | Failing to disclose important information about the property or the sale process. |
What if I suspect an estate agent is lying about an offer?
Seek further details, talk with the estate agent, complain, and report the agent to the Property Ombudsman if necessary.
If you have found that your estate agent has been lying to you, then the first thing you need to do is to gather evidence. If it is in writing, all the better, as verbal evidence won’t count. Once you have the evidence, put a complaint in writing to your estate agent – and while you are at it, serve notice to them so they can stop selling your house.
Next, you need to complain to the Property Ombudsman if you remain dissatisfied with their response to your complaint. The Property Ombudsman will take several months to conclude their findings and will tell you if the estate agent has a case to answer.
You could also leave them a genuine review based on your experience of their service. Reputation is a big thing if they are a rogue estate agent. As a result, an estate agent might let you go out of your contract.
But none of these options will sell your property for you, which is the result you are after. We can help you sell your property quickly and at a fair price – without all the hassle of dealing with estate agents.
We do this honestly and transparently. Sell us your property.
Can You Sell To A Cash House Buyer Instead?
One of the most common reasons you may want to learn how to sell your house without an estate agent is that you want to sell your house quickly.
There are many reasons why you need your house to sell quickly, and an estate agent cannot guarantee that speed. Although they can advertise and promote your property, they must wait until the right buyer comes along. Some of the most common reasons for a quick move include:
• Relocation – If someone needs to relocate or move abroad, they may not have time to go through the long process of waiting for a sale.
• Separation– A separation or divorce can be a stressful time, and that’s before even considering selling a house. A fast house sale can help remove this tension and make life easier for those involved.
• Inheritance– Having an inherited house can be stressful, so a speedy and efficient service can help.
There are several options if you want information on how to sell your house without an estate agent. There is always the option of using an auction house, although this also has its cons.
Another option is online property portals and sell house-by-owner websites, which offer listing your home online for a fixed fee, such as Purple Bricks. You will likely have to use their additional paid-for services such as floor plans, professional photographs, and an Energy Performance Certificate if you go with this option. You will also pay for services; they will advertise your property and wait for a buyer, assuming it was priced correctly.
This is not ideal if you need a quick sale! Various documents are also required to sell property, so you must ensure you have these sorted.
Alternatively, you could go with a cash buyer like Property Saviour for a quick, hassle-free sale.
You too could sell a house with no kitchen or bathroom, call us now on 0113 320 6700 or make an enquiry today, we are ready to buy your property today.
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