Hows this agents ethics.
I ring up about a new listing on Realestate.com.au and ask some questions about unit with fantastic water views, lets me have the good points, and bad points, then says he is going with family tomorrow for second look and is looking at buying, but feel free to submit an offer. This unit is list with other agents as well, so he tells me. I was put off straight away and could not believe he told me his intentions.
Has anyone else had something like this happen to them?Don
djr
Sounds a bit like he was trying to pique your interest by introducing some competition into the equation.
Backfired eh??Giddo
http://www.standrewsplace.com.auKNOWLEDGE IS POWER
Firstly Agents can not buy property from there own agency.
So they must engage other REA’s to purchase.Ive heard this line also…” Its a great house I should buy it myself” My answer, “well why don’t you!!!!”
Hi Giddo & Nazzysmitho153,
Yeah I have heard the “I would buy it myself if I could ” also from agents in the past, this one was a bit different as I felt he was trying to put me off buying as he seemed to be going on a bit about any bad points the unit had.The vendor would not have been happy if they new his intentions, I really believe the guy was going to buy this unit, but what I couldn’t believe was, he would tell me. Well it worked anyway, here is the link to the unit and you will see what I mean http://www.realestate.com.au/cgi-bin/rsearch?a=o&s=qld&c=37847801&tm=1132096364&id=102805012&f=0&p=10&t=res&ty=&snf=rbs&ag=&cu=&fmt=&header=Don
djr
Originally posted by nazzysmith0153:Firstly Agents can not buy property from there own agency.
So they must engage other REA’s to purchase.Are you sure?
I ask because I know for a fact it happens regularly…
F.[cowboy2]The Commissioner for Fair Trading can take disciplinary action against licensees and certificate of registration holders, and former licensees and certificate holders, who:
* breach the Act or Regulation, including the Rules of Conduct – for example, failure to account for money held in trust, or failure to properly supervise employees
*breach a licence or certificate condition
*conduct business in an illegal, unfair or incompetent manner
*become disqualified from holding a licence or certificate
*cease to be suitable ‘fit and proper’ for the duties of licensee/certificate holder
*fail to pay a required contribution to the Compensation Fund
*fail to comply with an undertaking made to, or a directive made by the Commissioner
*fail to pay a fine imposed by the Commissioner following disciplinary action
*hold a licence or certificate that has been obtained fraudulently or by mistake.Complaints and investigations
Any person can make a complaint to the Commissioner for Fair Trading about a breach of the legislation.The Office of Fair Trading can conduct investigations and take disciplinary action whether or not a complaint has been made, for example, where an investigator has identified a breach.
Agents need to be acutely aware of the fiduciary nature of the relationship with their client (the principal). The relationship between principal and agent places an agent in a position of trust, confidence and responsibility in which their foremost duty is to act in the best interests of their client. Agents must always deal with their client free of the influence of any interest which may conflict with the client’s best interests.
This does not mean that agents can use unethical tactics in dealing with their clients’ customers (tenants and purchasers) to get the best deal for their client. Agents are expected to deal with both their clients and other customers competently, diligently and according to principles of fairness and honesty.
There are 19 core Rules which apply to all licence and certificate holders, and additional specific rules which apply to the various categories of agency work.
Rules 1 – 5
1. Knowledge of Act and Regulations
An agent must have a knowledge and understanding of the Act and the regulations under the Act and other relevant laws, (including laws relating to tenancy, fair trading, trade practices, anti-discrimination and privacy) as may be necessary to enable the agent to exercise his or her functions as agent lawfully.2. Fiduciary obligations
An agent must comply with the fiduciary obligations arising as an agent.3. Honesty, fairness and professionalism
An agent must act honestly, fairly and professionally with all parties in a transaction.
An agent must not mislead or deceive any parties in negotiations or a transaction.4. Skill, care and diligence
An agent must exercise reasonable skill, care and diligence.5. High pressure tactics, harassment or unconscionable conduct
An agent must not engage in high pressure tactics, harassment or harsh or unconscionable conduct.Rules 6 – 9
6. To act in client’s best interests
An agent must act in the client’s best interest at all times unless it would be contrary to the Act or regulations under the Act or otherwise unlawful to do so.7. Confidentiality
An agent must not, at any time, use or disclose any confidential information obtained while acting on behalf of a client or dealing with a customer, unless:(a) the client or customer authorises disclosure, or
(b) the agent is permitted or compelled by law to disclose.8. To act in accordance with client authority
An agent must not act as an agent or represent himself or herself as acting as an agent on behalf of a person without written authority.9. To act in accordance with client’s instructions
An agent must act in accordance with a client’s instructions unless it would be contrary to this Act or regulations under the Act, or otherwise unlawful to do so.Rules 10 – 13
10. Licensee must ensure employees comply with the Act and regulations
An agent who is the licensee-in-charge at a place of business must take reasonable steps to ensure other licensees or registered persons employed in the business conducted there comply with the Act and regulations under the Act.11. Conflicts of interest
An agent must not accept an appointment to act, or continue to act, as an agent if doing so would place the agent’s interests in conflict with the client’s interests.12. Referral to service provider
An agent who refers a principal or prospect to a service provider must not falsely represent to the principal or prospect that the service provider is independent of the agent.A service provider is considered to be “independent†of an agent if:
a) the agent receives no rebate, discount, commission or benefit for referring a client or customer to the service provider, and
(b) the agent does not have a personal or commercial relationship with the service provider.The following are examples of a personal or commercial relationship:
(a) a family relationship,
(b) a business relationship,
(c) a fiduciary relationship,
(d) a relationship in which one person is accustomed, or obliged, to act in accordance with the directions, instructions or wishes of the other person.If the service provider is not independent of the agent, the agent must disclose to the principal or prospect:
(a) the nature of any relationship, whether personal or commercial, the agent has with the service provider, and
(b) the nature and value of any rebate, discount, commission or benefit the agent may receive, or expects to receive, by referring the client or customer to the service provider.13. Licensee not to recommend engagement of services of solicitor or licensed conveyancer acting for other party
An agent must not recommend that a principal or prospect engage the services of a solicitor or licensed conveyancer, or firm of solicitors or licensed conveyancers, if the agent knows that the solicitor or licensed conveyancer, or the firm of solicitors or licensed conveyancers, acts or will be acting for the other party to the agreement concerned.Sub-clause (1) does not prevent an agent recommending that a principal or prospect engage the services of a solicitor or licensed conveyancer if no other solicitor or licensed conveyancer is available (for example, in a remote location).
If no other solicitor or licensed conveyancer is available, the agent must, in recommending their engagement, advise the principal or prospect that the solicitor or licensed conveyance is or will be acting for the other party.
Rules 14 – 19
14. Inducements
An agent must not offer to provide to any other person any gift, favour or benefit, whether monetary or otherwise, in order to induce any other person to engage the services of the agent as agent in respect of any matter.15. Soliciting through false or misleading advertisements or communications
An agent must not solicit clients or customers through advertisements or other communications that the agent knows or should know are false or misleading.16. Insertion of material particulars in documents
An agent must not submit or tender to any person for signature a document, or cause or permit any document to be submitted or tendered to any person for signature, unless at the time of submission or tendering of the document all material particulars have been inserted in the document.17. Duty to provide copy of signed documents
An agent who submits or tenders a document to any person for signature, or who causes or permits a document to be submitted or tendered to any person for signature, must immediately after the person has signed the document give a copy of the document to the person.18. Representations about the Act or regulations
An agent must not falsely represent to a person the nature or effect of a provision of the Act or any regulation under the Act.An agent must not, either expressly or impliedly, falsely represent, whether in writing or otherwise, to a person that a particular form of agency agreement or any term of such an agreement is required by the Act or a regulation under the Act.
19. Agency agreements must comply with regulations
An agent must not enter into an agency agreement unless the agreement complies with any applicable requirements of the Property, Stock and Business Agents Regulation 2003, as required by section 55 of the Act.More Info @ http://www.fairtrading.nsw.gov.au/realestaterenting/agentsmanagers.html
Contact:
NSW Office of Fair Trading
PO Box 972 Parramatta NSW 2124 Australia
Tel: 61 2 9895 0111 Fax: 61 2 9895 0222 TTY: 61 2 9338 4943or contact your States Authority.
Unfortunately rules are made to be broken. It will be naive of us to believe that the agents would not get on to a deal themselves if they thought was a good buy. I’m interested to find the statistics on how many agents get prosecuted for perpertrating this. I read somewhere that agents are in the best position to get the scoop on a property. Perhaps a similar analogy would be insider trading with shares. Theres really only been a handful of insider trading cases that has been successfully prosecuted and this stuff happens EVERY DAY in the market. They make all insider trading cases high profile for a reason. It is very difficult to prove and this coming from a govt that has made a very concerted effort to clean up the securities industry. The mas and pas will just have to take a second fiddle even though they are investing 10 times more of their wealth in property than shares.
There are 19 core Rules which apply to all licence and certificate holders, and additional specific rules which apply to the various categories of agency work.I was told recently that young and keen investors know the rules.
Wily, cunning experienced investors know the exceptions.
Work colleague recently purchased a town house in Hamilton Hill just south of Freo. After his 2nd inspection he told the agent he was ready to put in an offer. When he told her his offer she refused to write it up saying that it was an insult to the vendor (circa $420K against $450K asking). My colleague was very taken aback by the agents attitude but really wanting the property and having in mind a higher cut-off price he reluctantly upped the offer to $430K. Anyway, after it was all written up and he’d signed the offer doc the agent then produced a notice of disclosure for him to sign, only then revealing that she had an interest in the property (her hubby was one of the JV partners). Needless to say, my colleague was very annoyed and felt he’d been duped into making the higher offer. To his credit, when the vendors countered he stuck to his original offer and is now the proud owner of the town house although he’ll forever wonder if he could have gotten it for less but for the questionable ethics of the agent.
Made this mistake only once many moons ago. Went with an agent to view an old property. She kept asking me what I would do with it and like a dill I went into in depth detail about reorganising the existing space etc.etc Next morning I rang up to put in an offer and was told it had been sold. STRONGLY suspect agent bought it but …. what can you do.
Fern
Yeah fernfurn,
Had this happen before to me as well.
Back when I used to buy houses the agents would always ask with a smirk on their face “What do you intend doing with the place ?? Are you going to live in it or is it for investment ??”
Foolishly I answered them in the early days, and summarily got kicked in the teeth too many times by them. After a while i just said,
“Look, what I do with the property after settlement is neither here nor there to either you or the vendor. They’ll have their funds and you’ll have your commission. What relevance is it to you ?? Now please, stop asking me questions and tell me everything you know about this property that you are representing.”
Thankfully with what we target nowadays, I don’t get asked these prying questions and there is no touchy touchy feely rubbish to murky the transaction.
Don’t let the squirrels pepper you with questions. You as a buyer are a walking bag of cash. They don’t need to know anything about you. Answer their questions and you shall need to fork out more.
Hello all
Reelygood1 or someone here, what constitutes a “penthouse”?
I clicked the link, admit fantastic views etc etc, but to me personally what I seen didnt appear to be a penthouse.
Not critising here, if you can help and correct my view be appreciated.
Cheers
Hi Aussielad,
Year your right, not quite a penthouse is it, another load of crap from the agent. Still the view is fantastic, you have to admit. Interesting reading other forum members experience with agents, its the only bussines I feel that has a conflict of interest.Don
djr
Hey Don,
yeah just wasnt sure, buy the way have you every read the book ” Don’t sign anything “, its an interesting read.
Cheers p.s the views / area are good never heard of the town before lol. keep the good work going
Fear of loss works both ways. Say to the agent, “Oh fair enough, if you get another one similar in the future will you give me a call”?
If you are investing – you will be buying with your head based on the numbers. He wants you to buy with your heart and come in strong with a good offer.
By turning the tables on the agent, and allowing him to “fear” the loss of a sale you can bring balance back to the relationship. In most cases I think the agent will backpedal at a rate of knots.Although REA’s have a reputation only one notch above used car salesmen, I just read this post in a different light. They’re supposed to disclose everything about the property and get the best price they can for the vendor, so how did the agent do the wrong thing by reelygood1 if they were a legitimate purchaser? Would it have been better (ethically) for the agent to have just made the offer and purchased the property without giving the interested party (reelygood1) the right to know that dealings were happening and offers were being put on the table?
(“,) $$$ HoLdEnCoMmOdOrE $$$ (“,)
it is quite difficult for agents to purchase property that they have been asked to appraise. to try and snare a bargain would almost beg a REBA investigation. in talking to REBA the other day about a slightly different topic, they said that the agent would need to conduct a valuation by a licensed valuer to ensure that their offer is not below a fair market value. And of course a disclosure goes without saying – and as soon as a seller sees a wordy disclosure of this nature they are bound to freak out and think somehting dodgy is going on. it really is too hard and not worth the hassles… easier just to go buy someone elses listing.
flatout – the experience you covered is interesting. it is illegal to refuse to write up an offer to start with. but realistically what would it achieve if it had been written up? the seller knows what they want and they were just saving you time. does the related party issue have any bearing on the final sale price? does the buyer really believe they may have got the property cheaper if the agent hadn’t been related to the seller? if the agent has secured the last $ for the seller then they have done their job (tho I dont condone refusing to write offers!)
http://www.megapropertygroup.comINVESTMENT SALES * RENTAL SOLUTIONS * STRATA MANAGEMENT
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