As an estate agent with years of experience in the industry, we have seen and heard of many tactics that some agents use to secure a sale, and we are sad to say that some of these tactics are illegal. These tactics are known as illegal conditional selling and go against the Estate Agents Act 1979. It also puts the interests of the agent and the mortgage broker ahead of the interests of the client. However, it is important to note that not all estate agents engage in such unethical behaviour. In fact, many of them, including us, are disgusted at these business practices.
The Estate Agents Act 1979 states that every offer made by a buyer must be put forward to the seller, regardless of which mortgage broker the buyer uses. This means that estate agents are legally obliged to present all offers to the seller, and they cannot prioritise offers based on the mortgage broker used by the buyer. Some agents ignore this obligation and engage in illegal conditional selling connected to their in-house services. It is not acceptable.
Illegal conditional selling is when an estate agent receives a higher commission or a financial incentive from a mortgage broker. In exchange, the agent only shows properties to buyers using that mortgage broker. And sadly, many buyers do not question these methods as they do not realise it is illegal practice. This violates the Estate Agents Act 1979 and is dishonest and unethical. There are many reputable estate agents, however, who abide by the law and act with integrity. Unfortunately, the actions of a few bad agents have created a common misconception that all estate agents cannot be trusted. As an ethical estate agent, we strive to build trust and good relationships with our clients. We believe transparency, honesty, and open communication are the key to success in this industry. This means presenting all offers to our clients and ensuring they have all the information they need to make an informed decision. Our ethos is all about trust; we are some of the good guys, and we are proud of that.
One way to build this trust with clients is to be upfront about commission rates and any financial incentives received from mortgage brokers. We always disclose this information to our clients so they know of potential conflicts of interest. This transparency helps foster a positive working relationship. Another way to build trust with clients – in our humble opinion – is to provide excellent customer service. Buying or selling a home is a significant event in a person’s life, and it can be a stressful and emotional experience. As estate agents, we guide our clients through the process and provide support along the way; we also try to make ourselves available to answer questions and address any concerns our clients may have. In a nutshell, we listen to our client’s needs and preferences and tailor our services accordingly.
In addition to providing excellent customer service, it is also essential to have a strong understanding of the local property market. This knowledge allows us to provide our clients with accurate and reliable advice on pricing, marketing, and negotiating. By staying up-to-date on market trends and local developments, we can offer our clients a competitive edge. It is important to note that reputable estate agents are also responsible for reporting any illegal behaviour they observe. If an estate agent witnesses illegal conditional selling, they must report it to the relevant authorities to protect the interests of buyers and sellers.
In conclusion, while some estate agents engage in illegal conditional selling, it is important to remember that not all agents follow these unethical practices. The Estate Agents Act 1979 sets out clear guidelines for the behaviour of estate agents, and reputable agents abide by these guidelines. If you want to buy a property, be sure to research the agent first and gain the reassurance you need to move forward with the honesty and transparency you deserve. This act aims to protect the interests of everyone, including you, so make sure you use this knowledge to your advantage. No one deserves the wrath of a dodgy estate agent!
It is also worth mentioning, however, that although a buyer is not obliged to use a broker recommended by the agent, it is still ok to use them if it is THEIR DECISION to do so. It is perfectly acceptable as long as it is not conditional of the offer being put forward and the broker is truly independent. It is all about choice…your choice!
If you have any other questions on this subject, please do not hesitate to get in contact. We want to help.