More than Gazumped in a Recent Property Buy

I went to see a property for sale in NSW, it was listed in range $1.2M - $1.3M.

He said there's some offers for ~1,280,000 - I said give me 2 days and I'll get my unconditional approval. 2 days later, I called and said I got the approval from my broker, I'm happy to offer $1,287,000 ($7,000 over the highest), he said great I'll send you the contract just transfer the 0.25%. I transferred the holding deposit. He called me the next day and said if you can do $1,290,000 you've got the deal. I said fine, let's do it.

So, the following day he sent me the contract of sale via DocuSign with 10-days Cool-Off, I signed, and sent a photo of my licence. I messaged the agent and asked if the vendor signed, he said "Yes!". I sent the Contract to my conveyancer and asked him to start the process, he did

Weekend. radio silence.

Monday radio silence

Tuesday my conveyancer emails me and asked me to ask the agent to hurry up and send him the fully executed contract. I was like 'wtf?'. I emailed, the agent said yep, my office is working on it.

Wednesday night I get a call and the agent said, sorry someone else bought this property, it was already under contract and we thought they were going to pull out. Send me your details to refund - thank you come again.

This is the state of our Property Market fellas, it's run by thieves.

Comments

  • +155

    REA - what a bunch of bastards.

      • +52

        Nah mate. REAs are lowest of the low. I'd rather be friends with a drug dealer than a REA. Only people REAs help is themselves.

        • +11

          Another person worried that someone with fewer language skills and no social capital is going to take his job.

          Sometimes I wonder how someone can have so few skills that some foreigner can easily take his or her job.

          • -5

            @justworld: Who do you work for? Elitist voices of Australia?

          • +2

            @justworld: Wow , resorting to personal insults with somebody with a different idea .
            I think you lost on lack of an actual argument , despite having some others agreeing your with short term view .

            • @beach bum: Any new migrant strolling in buying a $1.3 million dollar house isn’t exactly doing it tough nor are they a sympathetic figure to the average Australian. Pointing that out only to be accused of being too useless to compete with migrants is par for the course when it comes to migration sycophants.

              No surprise it’s poorly received on OzB though where the majority of people are themselves migrants.

              • +1

                @CommuterPolluter: They’re mostly sons of here , but that’s the thing they have a foot in both camps .
                On one hand they’re Aussie’s but on the other they’ve been raised by parents from another culture that are migrants that will always have split loyalty to our country , and all they are , is down to that fact .
                So they have to be pro-migration so as not to be hypocrites in they’re minds .

                But I say loyalty to this country must come first ,
                before any misguided justifications of your own existence.

                It’s a beautiful place that should not be destroyed just because the rest of the world is overpopulated and polluted , and people want to get away from it .

                If you don’t understand that look in to the future with Antarctica.
                You don’t think certain Countries aren’t building bases on any/our territory and pushing to make sure there aren’t any more environmental protections so it will be easier to exploit when the Antarctic Treaty expires .

                I mean there already doing the same thing here mining and not pay any tax to Australia .
                It’s not the lucky Country anymore ,
                It’s just another place to exploit .
                Don’t worry though you’ll be able to show your kids the koalas at the Koala Sanctuary or the birds at the Bird Sanctuary .

                It’s no wonder the olds you talk to are glad to pass on..
                I barely still recognise the place anymore and I’m not that old .

                • -1

                  @beach bum:

                  1. Nowhere has OP mentioned anything about migration or migrants.
                  2. Not just directed at one person but to all who are going on about how migration is $hit without realising why a country allows migration in the first place. Your stance is such an ignorant one. If you lot can't read through articles explaining why migration is allowed and in fact a need for a lot of countries, at the very least watch a 5 minutes YouTube video about it. It's gonna give you a perspective! And even if after that you make a fuss about it then i guess there's no reasoning with you lot.
                  3. If you lot are not an indeginous, you're a migrant or a decendant of a migrant too. The higher up the family tree that migrant, the more they potentially shift towards being "colonists" instead of merely being a migrant, and the more damage those ancestors have actually done to the indeginous australia to begin with.
                  • +1
                  • -1

                    @Arian10daddy:

                    1. I was commenting in response to the previous post above mine .
                    2. ‘You lot ‘ , who don’t agree with what I believe !
                    3. Seems we’re getting into personal attack territory again with family tree arguments and diving into history to justify current events .
                    4. Maybe open your mind to information beyond what the establishment is feeding you .

                    There is no need for a big Australia , unless it’s to increase the tax base so we can continue to buy hugely expensive American Weapons Systems and be the Deputy Sheriff of the South Pacific at the expense of our environment and living standards .

                    I’m sorry I don’t buy into what they’re selling but there’s a little more to it than “you people” who won’t shut up and swallow what you’re fed .

      • +7

        Next you are going to tell me that it's ok for a student to be given an unfair mark on a test if she has rich parents, but it's not ok if she has poor parents?

        Fairness is not predicated on whether you're buying an investment property or a place of residence.

        I doubt the REA was looking out for anything other than his own bottom line, but even if he was trying to help the other family, that's still an unfair position.

        The fact that your principles are based on pity and not actual fairness suggests that you have no integrity.

        If you're ever in legal trouble and you're my client, I'll jack up my hourly fee just for you.

        • -1

          there is no such thing as universally fair, ethical, moral. its all a construct. centuries ago something deemed as moral, ethical is no longer as such today. Everything is just is.
          You can jack up your hourly fee all you want. I just dont have to give it to you.
          The point of the comment is that context is everything. without context, its worthless.

      • Reads like fantasy.
        The agent will always do what is in the best interest for them, so highest bidder or most convenient to get the sale over the line quickly.
        They especially don't care about the buyers situation.

    • +12

      Well, yes but that's not grounds for executing contracts in anything other than good faith.

    • +3

      How does this apply in this situation?

      • -4

        OP should have known that the deal is not done until a signed contract comes back. No surprises there.

        • +1

          Doesn't the acceptance of a deposit initiate a contract?

  • +1

    " - thank you come again."
    sure
    .

  • +8

    A shitty experience for you for sure.. but this is not new and gazumping has been a thing in NSW for a while.

    If you’re certain you don’t need the cooling off period, you can choose to waive it and pay 10% deposit instead. You can’t be gazumped this way.

    *IANAL, speak to your conveyancer/solicitor

    • +14

      Yes, OP did get shafted up the IANAL

    • +4

      Yeah - this has been around for 25+ years. I was gazumped on a 2 bedroom unit, when I first started looking for a place to buy. Just as well. I ended up buying a 3 bedroom house and now that's worth more then that flat will ever be. And the house and flat were around the same price. (Unit in Meadowbank, house out west, NSW) I couldn't afford a house in the Meadowbank area.

    • +2

      Similar experience happened to me.

      Agents have no conscience.

      They just stuff you around.

      In Op's case, if they had another buyer on board with a better offer they should have given OP the opportunity to match or beat the offer.

      Clearly in this case the agent is looking after a "mate"

  • +48

    Yeah, you've been strung along, there was a better buyer out there for that property but they just need you to be there to pull the price up 1.3mil mark. It's unfortunate but there's not much you can do. Until the contract is signed and exchanged you don't hold much.

    • +19

      100% this… the REA just used OP to bump the price on someone else. OP was never going to get this house and was just an unwitting pawn in a shifty REA game.

      • Why did the agent need a real offer to do that? They lie all the time. He could have done it without getting the offer from OP or at least without getting 0.25% deposit.

        • +1

          Well, there's limit of how much of a lie you want to commit to, but in this case a concrete offer is always better to spring up the price. And there is another possibility that the agent/seller had a feeling that the other buyer are in a better position. OP made the mistake of telling them he/she went back to the broker to get approval for the higher amount so that essentially mean he's nearing the limit of his offer and won't have room to move. The other bidder might be in a stronger position and sometimes vendor just prefer having to deal with better certainty based on the information they can gather.

    • +12

      Yeah, you've been strung along, there was a better buyer out there for that property but they just need you to be there to pull the price up 1.3mil mark. It's unfortunate but there's not much you can do

      That's exactly right.

      What a bunch of deceiving and immoral people

  • -4

    Gazumped lol what scallywags

    • +10

      verb
      past tense: gazumped; past participle: gazumped
      1.
      INFORMAL•BRITISH
      make a higher offer for a house than (someone whose offer has already been accepted by the seller) and thus succeed in acquiring the property.
      "the trio are fuming after they were gazumped by a property speculator"
      2.
      DATED•INFORMAL
      swindle (someone).
      "I gazumped a friend of mine with complete success last night"

  • +41

    Perhaps next time play 'their' game….

    I have a friend that wanted to buy and the agent was doing their agent shenanigans thing. The friend said that he wanted to buy at $X and told the agent to go make it happen. If the agent was able to get the vendor to agree, then the friend would have that agent sell his current house.

    I don't know all the details but only that my friend is very thrifty with money so his offer definitely wouldn't have been at or above asking price.

    In the end he got the house exactly at $X and never gave over the sale to that agent.

  • +4

    At least you pushed the price up for the next person.

  • +12

    Effing disgusting behaviour and this is why most people hate REAs. There are some good ones and luckily I got a good one that didn't BS around, I was serious and I didn't eff around either with my conveyancer and broker.

    But also, not saying you're these people OP, you didn't mess about but there are alot of time wasters buying property and REAs unfortunately will do unethical things like OP stated to lock in someone.

    • I agree. Felt so annoyed when dealing with an agent last time… you feel like a fool. And have no control over it.

  • +6

    Add things like underquoting to that list of shady behaviour.

    There's a reason why REA are the least trusted profession in Australia.

    • +5

      And for good reason, they're all slimy untrustworthy people

  • Ah, i paid 10% deposit by cheque with the contract, ( in those days cheque was acceptable), after few days I got message that owner don't want to exchange with you and went with someone.

  • +10

    Huh? I don't understand. "Just transfer the 0.25%"?? Holding deposit? WTF? No. And then changing the price after you've paid a deposit?

    If this actually happened the way you describe, I'd be reporting the agent. Learn how these things are supposed to work and you wont get burned, eh?

    • +11

      Holding deposits are useless, they're usually just a guide to the agent that someone is actually seriously about buying. Signing the contract and paying the 10% is the only thing that actually secures the property, unless the holding deposit comes with an agreement that it secures their right to buy. Holding deposits are just an "expression of interest".

  • +17

    Sorry that happened to you OP.

    Maybe leave a review of your experience in some of the REA websites:

    • +5

      Do you though? There's no issue with getting them to outbid each other, they didn't need to take OP's money to do it. That vendor will have done stuff like this to other people who won't deal with them any more. That means less people willing to look at or buy your property. When I was looking to buy, any agents who were clearly POS I just crossed them off my list and wouldn't look at their properties. Guaranteed there are a bunch of people wanting to throw money at agents for houses that won't be throwing it at that agent. Probably could have gotten at least another couple hundred thousand if they weren't so untrustworthy.

  • If you think this is bad. In the UK you can have a deal but they won't exchange contracts until 1 month before settlement and during that time you can get outbid. If you sold your place and need to move in then you are stuffed.

    Real estate people have no ethics.

    • +1

      Actually there’s usually clauses in these contracts that say if your sale delayed, you can then delay the transfer of your purchase, which means there’s a massive domino effect of people being delayed because of someone 10 properties earlier in the transaction. Friend of mine was delayed 6 months because of something like this.

      Edit: TIL it’s called a “property chain” https://www.nationalpropertybuyers.co.uk/blog/house-selling/…

      • +1

        That is chains. I always ask. Buying with chains is usually a problem especially given how in the UK you variable rates are like 2% more than fixed rates that can get pulled at any time.

    • …also the same here - you can be outbid until exchange.

  • +7

    You don't have a contract until both parties sign.

  • +18

    TIL that "gazumped" is actually a word and means this specific situation.

  • +2

    Unfortunately gazumping is completely legal in NSW. Unethical sure, but legal

    • -1

      I don't understand this. Contract signed by both parties and consideration paid. How is this not breach of contract? Or fraud?

      • +2

        Contract was NOT signed by both parties.

  • +5

    I had a very similar situation happen to me 5 years ago. They wanted $5k higher after the contract was signed by me, but not the vendor, and the vendor received a higher offer.

    It was only $5k but I told them to f.ck off. I ended up getting a nicer place, in a better location, for cheaper. Hope you have the same!

    In the selling REA’s defence he was also Duped because the vendor was a REA that was double dealing with colleagues on the sale of the house (with no contract in place so it was legal)

    • I feel like I need a shower after reading this. So much gross.

      • +1

        In the end it worked out better for me but I was not happy at the time. It was actually the vendor’s (also a REA) fault as he was double dipping with his REA colleagues.

        I’ll never forget the call I had with the REA as I had to calm him down because he was so angry with the vendor for screwing him over.

  • +3

    Its a sad world… but you took the word of a real estate agent….

  • +2

    not gazumped. basically they had a buyer already that they thought was going to pull out so they strung you along as a safety net. pretty poor and unethical not to tell you the situation.

  • +3

    One thing I have learnt in my many dealings in real estate is to never trust anything that an agent says, and always be prepared for the worst until everything is completely finalised.

  • +8

    On that Monday you should've contacted the agent that unless you received the countersigned contract by the end the of the day, your offer is withdrawn (and follow up with a written email). No excuse for the agent as he's already confirmed the contract is signed.

    Puts pressure on the vendor with no 'backup offer' on hand, its risky to chase the other buyer hoping for a better offer

  • +2

    Wednesday night I get a call and the agent said, sorry someone else bought this property, it was already under contract and we thought they were going to pull out. Send me your details to refund - thank you come again.

    I've got a pretty "all's fair in negotiations" mindset, but that is disgraceful behaviour. It's one thing to string potential purchasers along, but accepting any form of deposit only to renege is not cool.

  • This is the state of our Property Market fellas, it's run by thieves.

    I'm surprised you're just realising that now… are you willing to share the address of the property? The buyer probably overpaid for it anyway.

  • +4

    Sorry you had to go through this, its quite common for them to push their luck to see if someone is willing to pay more (in which you did from 1287k to 1290k) then they can take this offer to other buyers and see whats the last offer.

    Had a REA told me to offer 2k more as it would be 'better' and I said why, who else is offering that and he said no one and i said nope. He called me few days later and said original amount is fine and i said no thanks already submitted offer for another place (which was more expensive than the one i looked at but also way nicer). Was soo tempted to tell him to flip off, why tf would I submit an offer higher than myself.

    Moral of the story, stand your ground, don't overpay and just wait if you can.

  • +2

    Queenslanderrrrrrrrrrrrrrrrrrrr

    Is gazumping legal? Unfortunately, yes – in most parts of Australia, gazumping is legal, or at least not subject to regulation. Queensland is generally seen as the only jurisdiction that has taken steps to actually eliminate the process.

  • LOL standard

  • +3

    Had a bad experience recently. Tried to get in and view a property we liked for 2 weeks but tenants had a couple of medical issues. Finally had something solid setup and another buyer swooped in the night before and made an offer without even inspecting.

    Bit of back and forth with agent that I was keen and would make an offer after viewing but I wasn't prepared to make an offer without an inspection. Agent ended up calling back to say that had upped their offer by another 5% but needed an answer that night and the seller accepted.

    Couldn't imagine buying sight unseen. Just standing from the street I had a few things I would want to check once I had access.

  • +11

    Never trust those bastards. 101/100 things out of their mouths are lies.

    • +1

      And same with many people working for commission

  • -4

    If that was you selling the property, I am pretty sure you would do the same.

  • +3

    As much as i hate auction, it's much more transparent process. I hate this silent auction.

    Sorry to hear your experience OP.

    • Yeah, no wasted time going back and forth. You know immediately if the property is yours or not and for what price.

      • unless you don't meet the reserve

        • then you know what the actual selling price instead of the underquoted "price guide"

          • @star-ggg: I think they can also choose not to sell at reserve… Maybe

  • +2

    Wednesday night I get a call and the agent said, sorry someone else bought this property, it was already under contract and we thought they were going to pull out.

    After all that sh$tf##ckery, I hope you took at least a few minutes out of your day to report this dodgy dealer to the NSW Fair Trading.

  • Shit happens.

    Seller had two selling agents on the one property, non exclusive obviously. We signed late by 2 hours and the other agent got there first.

    Place is now worth triple the price 10 years on.

    Sometimes it's just the agent being dcked around by the seller wanting more. Agent only gets 2%, an extra 2% of $5000 doesn't mean squat for the agent.

    • +1

      'Seller had two selling agents on the one property, non exclusive obviously'

      disagree - I was talking to a successful agent this afternoon and he agreed with me that when vendors sign non-exclusive sales agreements hoping that agents will work harder and 'compete' to make the sale, actually the reverse happens - agents who know they have a 100% chance of getting the commission if they sell a property through their own office exclusive agency agreement - think 'why bother if I only have a 50% chance of getting the sales commission' - too much room for unknowns, trickery and arguments - and typically NEITHER agent will bother to work on it.

      More likely as in my other post - two sub-agents from the same office are competing for the sales commission, as typically only the person who gets the contract signed by both vendor and purchaser gets the sales commission.

      As you suggested, the sub-agent won't care about an extra $5K in sales price - if they get 1% as sales commission or $50, they won't care about that

      What they DO care about is getting the selling commission or NOT - say 1% on $1M or $10K for the sub-agent who got the deal signed by both parties - and squat or ZERO$ for the sub-agent who almost but didn't quite get it done.

      • That's good insight. I can't actually remember the exact detail, but the property wasn't exactly a 'clean' site and had a major issue if it did eventuate.

        It's really too hard to guesstimate what the other party is doing, which is why there is the need for agents in the first place to 'buffer' the human interaction.

        I do remember clearly the agent was in a rush so it must have been an internal thing.

        I've already always wondered with agents inside one of the branded agencies who ends up getting the commission or it's just team commission as there's been a lot of multi franchisee takeovers.

        • when I worked as a real estate salesman in Melbourne last century, if I recall the total sales commission might have been 2.5% or 5% (I forget) of the sold price.

          the agency (business owner) scored the cream - maybe 1%, the listing sub-agent who got the vendor to sign the listing 'for sale' agreement got 1%, and the sub-agent who got the vendor and purchaser to sign the 'sold' contract got 0.5% (or 40/40/20% of the total commission)

          so the sub-agents got twice as much for listing as selling.

          • @Hangryuman: Fair enough though. Cannot sell it if you don't spend the time to keep up appearances, marketing or maintain the client relationship.

  • +2

    Filth; may they rot in shit.

  • In future meet with the vendor to sign contracts. Youre there to witness signing. You can then confirm what is happening next. Remember the rea is working for the vendor and not you.

  • Disgusting behaviour. The industry is ripe for a shake-up

  • If you can really be bothered, worth taking them to small claims court.

    • for what? until exchange of contract it's not legally binding.

  • not uncommon unfortunately
    it's usually incompetence/laziness of the REA rather than nefarious dealings
    if in a position to waive cooling off (s66W in NSW) always do so if you want to beat the competition - it trumps a condition offer any day

  • Bikies.

  • Off topic - sorry to hijack the post.

    When buying a property at an auction, usually it has to be unconditional which means we have to do the due diligence before hand e.g. Building & Pest Inspection.

    If we're unsuccessful at a few auctions then this cost adds up for each property as we HAVE to get it done before the auction compared to when it is a private sale and we can sign a conditional offer and do the B&P later.

    Any suggestions on how to save these costs for auctions. Looking at how most properties are going at auction these days.

    • +1

      no real way around it unless you push for pre-auction offer, a lot of vendors do B+P where you don't pay or can buy a copy for a small fraction of the fee with the full fee to be paid if you win the auction. unless you are buying for land value you are taking a big risk going in blind. budget for it as cost of transaction - if you have to spend 2-3k in the course of your search it's a drop in the ocean compared to major structural defects or termite issues that you might miss

    • +1

      I found out about a site called Before You Buy where you can see if anyone else has already ordered a report on the same thought as you that maybe it can be cost shared unless you actually win the property. (Something like that)

      It only saves you money if there's enough interest for multiple people to want one but sounds like better than nothing.

    • Only do them if the house value is a substantial proportion of purchase price. B&P inspections are non-invasive and have so many disclaimers they're more than likely to miss things or just point out things you can already see.

  • +1

    And people are actually surprised by these low-life REA's??

    Good on that guy in a thread here last month that got one over these ****ts, by going to the buyers that missed out on the side.

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