Be Cautiously Kind To Sellers' Agents

OPINION
by Tim O'Dwyer M.A., LL.B
Solicitor
Consumer Advocate
watchdog@argonautlegal.com.au

 

Although agents use slogans like "Nobody does it better", "The right advice", "More personal attention" and "We'll look after you", they are really offering buyers something for nothing. At all times the agency s legal duty is to their clients, the sellers. The agent s prime job is to find a buyer at "the best possible price and contractual terms for the seller".

The least expensive part of buying a home is the looking. Legals, searches, loan fees, stamp duties, insurance premiums and removalists' charges come later.

While "just looking", your only cost will be the time and effort put into that quest. Many hours will probably be spent with real estate salespeople keen to help you make your final choice.

Most home-hunters look with a real estate agency, yet this service is provided free. Why so?

"Buyers do not pay fees to the agent. The agent receives commission from the seller."

This answer comes from a brochure produced jointly and incredibly - by a Real Estate Institute and a Law Society. The brochure continues:

"A real estate agent, as the agent of the seller not the buyer, is responsible for obtaining the best possible price and contractual terms for the seller. The agent will receive a commission from the seller when the property is sold."

Although agents use slogans like "Nobody does it better", "The right advice", "More personal attention" and "We'll look after you", they are really offering buyers something for nothing. At all times the agency s legal duty is to their clients, the sellers. The agent s prime job is to find a buyer at "the best possible price and contractual terms for the seller".

Buyers should therefore use sellers agents' "services" carefully. Cross-check anything you are told, but temper your wariness with courtesy to the agency and its staff. Here are some tips on being cautiously kind to real estate salespeople:

* If you follow up an advertisement, ask for the salesperson named in the advert.

* Remember the salesperson will usually get paid only after your purchase settles.

* Be aware that sales staff usually supply, service and fuel their own cars, and provide and pay for their own mobile phones.

* Before visiting an agency, check your eligibility for finance and your affordable price range with the lender of your choice. (Avoid a financier or broker recommended by the agent, who may receive a referral commission.)

* Give full details of your needs (don't wait until after several inspections to mention, for example, that you must have space to park a semi-trailer).

* Make sure you keep appointments, and phone if you can't (a salesperson who wastes time waiting for you may lose the chance to sell to someone else).

* Don't smoke in the agent's office or car without obtaining permission.

* Leave the kids (and your animal pets) at home, but if you can't, watch their behaviour and don't let them have food or drink in the agent's office or car.

* Even if you are told, "Call me any time", try to keep your phone calls to reasonable hours.

* After inspecting a property tell the agent what you didn't like - but not in front of the owner and whether you have already been introduced to the property with another agent.

* When you find what you like, ensure any offer is realistic and based on the prices of other homes you have inspected.

* Take the offer papers to your solicitor (definitely not the agent s recommended one) for advice before you sign. Tell your solicitor everything said or promised by the salesperson.

* Once the contract is all signed up, tell the agency any further dealings should be through your independent solicitor.

After you have gone from home looker to home buyer, then finally to home owner, remember the agency, its salestaff and how they may have helped. If you appreciate what they did, send them a thank-you note - and maybe an invite to the housewarming.

 (This article first ran in the November 2007 10th Anniversary edition of Australian Property Investor magazine)

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