I've noticed over the past few years, agents often attempt to run mini auctions when more than 1 person is interested in a house, even when the house is not officially up for auction. After receiving an offer, they call the other buyers, and ask them to offer more, then take that offer back to the first buyer, and keep going trying to push up the price.
Is this legal? There are even bidding apps they ask you to use, resulting in a virtual auction even before the seller is accepting offers.
Imagine listing with an agent that wasn't trying to get you the best price…
Just like most humans, the agent will take the path of least resistance. If it's easier to brow beat down the seller then they will do that. They just want a sale. Let's see….. difficult sale for $1.25mil, or easy sale for $1.2mil, the amount of commission difference is negligible.
I thought it was illegal for an agent to tell a buyer what another buyer has offered.
I thought it was illegal for an agent to tell a buyer what another buyer has offered.
Where/how would this be illegal?
From a quick google search, some real estate websites state something like: "Legally, the real estate agent cannot disclose the terms or price of another parties offer. "
"All offers are meant to be private and not able to be disclosed to competing parties. "
or something similar.
@ForkSnorter: Erm, you also have websites that say the exact opposite
Legally, agents in NSW are allowed to disclose current offers to any other potential buyers. Agents are required to inform the seller of all offers made to purchase the property, but there is no law to prohibit the disclosure of offers to potential buyers.
this happened to us when we bought in Qld in 2013 for a house that was accepting offers (not auction)….agent called me to say FYI another buyer offered XX amount
When I bought my property years ago, this was already a thing. The agent I dealt with did not disclose a price but just said that my offer was low and if I wanted to secure the property, I should increase my offer price. This is sometimes a bluff (never trust an agent) and as I found out, mine was the winning offer.
So you did not increase your "low" offer and were still the highest bidder?
How did the agent come back to you and admit this without losing face?
@nige0090: offer was low =/= there are higher offers
it could just be lower than what the seller was expecting but then decides to take it due to no higher offers received after some time as desperation kicks in.
unless they specifically said there are higher offers, even then the higher offer could've pulled out due to finance, etc.
@nige0090: At the point where you get the property at the price you determine to be rightful, there’s really no need for him to admit anything. I just take it as them doing what they need to get the sale price they need and like @phunkydude said, they could probably come up with some BS like the other persons finance fell through. All in a days work for them
Not necessarily a bluff my friend
You were probably just short of the minimum price which the vendor wanted.
Dont forget the vendor is also on the agent's call list being pressured to reduce price to match the buyers offers.
There is no sale if the vendor does not agree to any offer price.
You got what you wanted and at a price you were willing to pay
The vendor got a price they were willing to accept but not necessarly what the agent had initially suggested.
And hence the property SOLD!
Its a WIN WIN situation for everyone really
Be happy with what you got
This is what a good agent will do
Without all the advertsing expenses and auction fees
Real estate agents attempting to auction properties over the phone
Only the past few years?
They've been doing this since the days of Alexander Graham Bell…
They've been doing this since the days of Alexander Graham Bell…
Yeah, but I didn't notice it back then.
Agents have been auctioning over the phone back in the stone ages when Ugg wanted to trade his corner of the cave for a mammoth skin.
They've been doing this since the days of Alexander Graham Bell…
First phone call: "Watson, come up with an extra 50 thou and I think the house will be yours"
If someone's prepared to pay for it the agent is well within their rights to do it.
Whatever gets the highest price.
They're working for the seller not the buyer.
Not a fan of it personally but it's where the market is heading.
This happened 20+ years ago when I purchased a house. Only difference was, it was tedious for the RE using land lines and leaving messages on answering machines to call back. Nothing new to see here. Carry on.
This is nothing new (maybe the app thingy but I’ve not encountered that for a sale in a house, auction yes, sale no).
I don’t like it but it has worked in my favour in the past as it allowed me to make an informed decision on the sale and whether I wanted to spend the extra amount and how much it was (I didn’t)
Assuming that there's actual other buyers.
Imagine getting into a bidding war with yourself.
Imagine a RA being so dishonest as to imply there are other higher offers to get more money out of someone.
That would be like being sold ‘someone was just in here looking at this’ when there was no one who looked at it
Yeah… that would be my first thought. I’d just say ok, thanks for your time
It's their job to get the best price. They are paid by the seller not the buyer. Good on em'!
Completely legal. It's called Dutch (silent) auction
No, this is not a Dutch auction (and a Dutch auction is not the same as a silent auction). In a Dutch auction, the price begins high and slowly decreases until someone bids. The first bidder wins the auction.
Totally legal.
Having recently been on both sides, auctions are not the best option for many properties but to think selling works in the sense of 'first to offer me x wins the house' is silly. There are several moving parts up for negotiation.
Equally, buyers can participate (as I have on some properties) or say no, this is our best offer, take it or leave it (and cannot complain when it gets left).
Had this happen recently. Didn't end up getting the house but did push up the price for the person who did.
OP "After receiving an offer, they call the other sellers,…" Should read "buyers" ?
Yes, sorry.
I'd be reluctant to participate as how real is the other buyer. I'd give my offer and then step back.
I've always given the real estate agent the impression I'm also looking at other properties and that this particular property ticks a few of my boxes but not all.
'working the phones' is not new, it's their job to get the highest price for the seller
i'd not participate in an app
.