Can estate agents lie about offers?
When an estate agent markets a home they’re legally obliged to treat both buyers and sellers fairly by following the Code of Practice for Residential Estate Agents. This means they should not lie about offers to any party involved. However that doesn’t mean they won’t push the boundaries of what’s allowed, so you should always have your wits about you.
You can avoid estate agents altogether by working with us. We’ll make you a transparent offer for your home and won’t charge you any fees for selling it.
Settling on an asking price
When you first contact an estate agent they will visit your home and assess how much they would put it on the market for. Although this is often described as a valuation, this is a free service and different from the valuation a mortgage provider will undertake to make sure a property they’re lending on is worth its price.
An estate agent must honestly appraise your home and provide evidence of how they’ve got to a certain value, by comparing it to other properties on the local market for example. It’s worth asking several agents to visit so you have a range of quotes to choose from. You should also do your own research to get some background on the market that will help with your decision.
When you come to deciding which agent to work with bear in mind a couple of things:
- Working with the agent recommending the highest price isn’t necessarily the best option. They might just be trying to win your business, but if a price isn’t realistic your home will be on the market longer.
- Check their fees and don’t be afraid to haggle.
- They’re not allowed to pressure you into using other services they provide, such as conveyancing. If they do, would you be comfortable working with them?
- Take claims about buyers they have ready and waiting with a pinch of salt. If buyers are that keen on homes in the area they will come across yours however you choose to sell it.
Once you have settled on an estate agent, you’ll agree on the value of your home. This will be the asking price when the agent puts it on the market.
Receiving offers as a seller
The asking price is the starting point from which homebuyers will work when they’re thinking of an offer. An estate agent is legally obliged to tell you every offer that is made in writing unless you have asked them not to. For example, you might not want to hear about offers under a certain amount.
Agents are not allowed to give preferential treatment to offers made by buyers who have committed to using their services (such as in-house mortgages and conveyancing). And they mustn’t pressure you to sell for a lower price because they believe the sale will move faster. Perhaps the lower offer has come from someone not in a chain and less likely to face delays.
It’s worth remembering that once agents have your home on their books they are usually keener to sell quickly than at a higher price. If their fee is 1.50%, selling a home for £10,000 more will only bring them an extra £150, which is small compared to their overall fee.
However a quick sale might be your top priority, so it’s good to know if a buyer is in a position to move at speed. And if you need to move particularly quickly we can buy your home in just seven days.
Making an offer as a buyer
You can make any offer you like. Sometimes the details of a home will come with price guidance such as:
- OIRO – offers in the region of
- OIEO – offers in excess of
- POA – price on application
But there is no obligation for you to follow them.
Agents are not allowed to make up offers to try and push the price up. However, they may use various tactics to make you feel that you must meet or exceed the asking price.
These can include telling you that other offers have been made near to it, commenting on the fast pace of the market or asking for sealed bids which involve everybody who is interested simultaneously writing down their best offer. The seller will then choose which one to accept. Try not to be swayed away from your budget by these tactics.
Once you have made an offer, the agent should keep you up to date with the progress of yours and other offers. You can ask exactly how much others have offered, but agents will usually tell you they’re not allowed to say. In reality, they can tell you this but would need to get permission from the seller and tell everybody who has made an offer the same information. If it is a condition of you making a higher offer, say so, and refer back to the code of practise if you need to.
As we’ve mentioned, some sellers want to move quickly so make sure you let the agent know if you are in a position to do this. For example, you are a cash buyer or a first time buyer.
Once a seller accepts an offer the buyer will often ask for the home to be taken off the market. This is normal practice, however it doesn’t always stop a seller accepting a higher offer if one comes in. This is known as gazumping.
Although this can result in a buyer losing hundreds of pounds on valuations and legal fees gazumping is not illegal. That’s because nothing is legally binding until you have exchanged contracts.
The rules are slightly different in Scotland where a solicitor cannot continue representing someone if they accept another offer having already agreed one, which makes gazumping a lot rarer.
Working with us
Juggling all the requirements that come with selling a home, weighing up offers and dealing with estate agents, can be stressful, especially if you’re in financial difficulty. Our service takes all those hassles away.
Once we make a firm offer for your home, we’ll stick to it. Although it might not be the highest price you could get on the open market, we can buy your home in seven days, which means your mortgage payments will stop. We’ll also cover solicitors fees and you won’t have to deal with estate agents. Get in touch if you’d like to find out more.