It’s interesting that when the general public is asked about their opinion of real estate agents, the word ‘dishonest’ is one of the most commonly used descriptions.

So why are agents generally considered to be dishonest?

From my experience, the better agents gain their solid reputations from their ability to share the truth…whether that be good, bad or indifferent.

So why do many agents shy away from the truth?

Let’s have a look at the classic reasons that some agents are dishonest and what motivates them to be this way?

  • The Missing Agent – Many agents fall into the trap of avoiding their seller if there is no activity – that is, no enquiry, few inspections (or even none at all), no feedback from buyers etc. Some agents fall into the trap of being caught up with properties that have lots of inspections and other activity and forget the ones that have very little going on. All of a sudden, the seller calls the agent to find out what’s happening and the agent feels twice as bad as they haven’t called and procrastinates calling them for longer. The public perception is that this sort of agent is dishonest when in actual fact, they are usually embarrassed because they over-promised at the start.

 

  • The Protector of the Price – Sometimes, an agent will appraise a property at a certain price and when the market feedback is not as high as the price they quoted, the agent will often ‘shield’ the owner from the low feedback. In this case, the agent just finds it hard to admit that they were wrong and despite what the perception is, some homes are truly very difficult to appraise. Likewise, an agent might not want to pass on the buyers’ feedback of aspects of a home such that might offend the owners, (perhaps something such as poor workmanship of a renovation that the owners may have done themselves) or harsh criticism of the home in general.

 

  • The Over-Appraiser – many times, this agent deliberately and consciously provides the seller with an over-inflated appraisal price in order to attempt to tempt the seller into listing the home with them…I think the general public is well aware of this. There are times when an agent appraises a home even though they may have good intentions, usually when a seller discloses what price they’re looking to achieve. The agent (who might not have done their research or might not be confident with prices in the area) unwittingly tells the seller what they want to hear because they aren’t sure themselves. When my team and I appraise a home, we don’t like to ask the sellers how much they’re hoping to achieve as this can influence our opinion. I read a recent article where a seller interviewed ten agents in his area and deliberately told the agents that he wanted a certain for the property (a figure which was clearly $100,000 above what he knew it was worth). Interestingly, seven out of the ten agents came back with virtually the same appraisal figure as to what the owner stated they wanted to achieve whilst another two agents hedged their bets being $50,000 below the owner’s price but still $50,000 higher than what it was worth. The final agent came back with an appraisal figure that was at market value…and very close to the figure that the home eventually sold for.

 

  • The Feedback Distorter – Usually reserved for auction properties, this deceptive agent informs the seller of the market feedback (often the agent reports the feedback to be lower than what is actually is in order to set a ‘more than reasonable’ reserve price. This trick is often used by agents that promote many of their properties without a price indicator and their general sales pitch to the seller is “let’s let the market determine the price”. The problem here is that the ‘market’ may not be accurately conveyed to the seller, and even if it is, if the only feedback that is being obtained is from buyers that don’t really have a clue…or aren’t being honest themselves, how is a seller supposed to navigate their way through this minefield and determine what advice is honest when there are so many different opinions?

 

  • The Offer-Conditioner – Sometimes, a dishonest agent may ask a buyer to place an offer in writing just to provide a deliberate feedback figure to their owner…and this agent has precise knowledge that the offer has no chance of being accepted despite telling the buyer otherwise. The offer may be used to ‘condition’ the sellers towards adjusting the price to a figure that may be closer to the true market value.

 

  • The ‘Make it Up As You Go’ Agent – Often, this sort of agent has trouble saying “I’m not sure…let me find that out for you”. If a buyer asks a question about a home, the agent feels that they need to have all the answers to look clever and provides answers that they are not sure to be true…or even worse, they tell the buyer information that they know not to be true…just in order to close a quick sale…and worry about the consequences later.

 

I’m not defending any of these categories as we have the strong belief that every buyer and seller needs the complete truth without exception…however, it is easy to see how a ‘pleaser’ type of personality or one that doesn’t like confrontation may enter some of these grey areas without actually meaning to be deceptive.

Certainly, when choosing an agent, it is easy to provide a few simple tests to determine the honesty of any agent and we would highly recommend you do this or you could be receiving advice that could cost you tens of thousands of dollars.

 

Until next week, Happy Listing & Happy Selling

 

 

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It’s interesting that when the general public is asked about their opinion of real estate agents, the word ‘dishonest’ is one of the most commonly used descriptions.