There is a practice engaged in by some real estate agents of contacting the owner of a property and informing them that the agent has an interested buyer of the property at a price that immediately sparks the owner’s interest.
The agent then signs up the owner to an exclusive agency agreement to sell the property for a period of between one to three months. The owner is only too keen to let the agent arrange an inspection by this very generous buyer. Only problem is that the buyer does not exist and the agent will then look through their records to see if a potential purchaser can be scrounged up to try and convince the owner that it is all legitimate.
Invariably, one or more parties take a look at the property and show no interest and the agent feigns surprise. The owner is then informed that a campaign (costing a packet) will definitely find a buyer. Unfortunately, the owner is stuck with the agent for up to three months.
Recently, a client of mine was presented with this situation and the agent was applying pressure to the owner to sign an exclusive agency agreement. I contacted the agent and demanded to know the name of the buyer and the name of his solicitor. After being given the details, I contacted the buyer’s solicitor and ascertained that it was all made up.
Luckily, my client checked with me first and did not sign the agency agreement. He agreed that if he ever wants to sell his property, he will find his own agent as those who promise much usually deliver little!
June 2021