Real Estate Agent Dirty Tricks

While the vast majority of professional Real Estate Agents maintain high ethical standards, there are some that bend the rules of the Real Estate game more than just a little.  Many unsuspecting home buyers and home sellers have been victimised by some of the “dirty tricks” played by unscrupulous Real Estate Agents.  To keep from becoming an unwitting victim, there are some things you can do.

The first and most important is to ensure you select an ethical Real Estate Agent from the beginning.  Many prospective buyers are in such a hurry they select a Real Estate Agent without any attempt to gauge the knowledge and trustworthiness of that Real Estate Agent.

Tip 1: Don't be in a hurry, because you will loose money.

In a similar fashion, sellers will sign on with any Real Estate Agent who promises to get them top dollar for their home.  Let the Buyer (and the Seller) Beware, and interview several Real Estate Agents before you decide.  In addition, get references from the prospective Real Estate Agent and talk to them as well.

Tip 2: Interview several real estate agents.

Here’s a trick pulled by many listing agents when signing a contract to represent homeowners in selling their home.  To understand this trick you must remember that Real Estate Agents only make money working with you when a house is actually sold. 

A Real Estate Agent representing a home seller gets the same commission from the sale of a $200,000 home that takes nine months to sell as he or she does from a home that sells in nine days.  Time is the enemy of the Real Estate Agent as the longer the process takes, the more of their time is devoted to it.  Seller’s agents have a deep vested interest in selling a home quickly.  The dirtiest trick of all is for a Real Estate Agent to encourage a homeowner to list a home with an asking price that is below current market value.  If you’re heard stories from friends who feel they were lucky since their home sold to the first person that walked through the door, pity them because they weren’t lucky, they were in all probability victims of this dirty trick.

Tip 3: Know the market, hire an independent valuer.

Sellers can protect themselves by asking to see the comparable home prices in their area which a Real Estate Agent uses to help determine the initial asking price.   Comparable homes in an ideal world would be strict “apples to apples” comparisons but in the real world they rarely are.  Your home may be a four bedroom/2 bath that has some slightly different features from a comparable 4 bedroom/2 bath home for sale in the neighborhood.  This element of subjectivity in the comparison enables an unethical agent to pull the trick.  If the suggested listing price for your home is significantly lower than the comparables in your community, get the opinion of another Real Estate Agent.  In addition, if you are told that a certain home shows much better than yours, take a chance and contact the home owner directly to see if they are willing to let you visit their home and see for yourself.

No matter how trustworthy you feel your agent is, never reveal your limits.  Buyer’s Agents may already know the amount of the mortgage for which they’ve been pre-approved.  Never make a statement like “Well, we can borrow up to 200,000 but we can get another 20,000 from Grandma so we could actually go higher”.   Sellers should never make statements like “$175,000 is the absolute lowest we’re willing to go.”  Once again, when it comes to Real Estate Dirty Tricks, let both the Buyer and the Seller beware!