Appointing an estate agent
The time-honoured way of selling residential property is to put it in the hands of a local estate agent.
Although it’s true that traditional High Street agents have enjoyed years of easy pickings, their job is rarely as simple as we sometimes imagine. Much of the donkey work, such as accompanying endless viewings and patiently holding chains together, gets carried out below the public’s radar. Although it’s now easier than ever to sell privately, the vast majority of properties are still bought through estate agents, who are by far the biggest source of homes for sale.
The law says…
Under the Consumers, Estate Agents and Redress Act (2007), all estate agents are required to join a Property Redress Scheme that can investigate complaints, resolve disputes and offer compensation.
The industry is additionally regulated by a hotchpotch of legislation; from the Estate Agents Act dating from 1979, right up to recent Consumer Protection Regulations and Business Protection Regulations, described in Chapter 16. This makes it an offence to give false or misleading descriptions, although many breaches go unchallenged or cannot be proved. The law says that:-
* Agents must pass on all offers promptly and in writing to their client – the seller. This includes those made long after a property goes ‘under offer’. The only exception is where the seller has told the estate agent not to pass on certain offers – for example, all those below a certain price.
* Agents are legally obliged not to deliberately mislead or misdescribe something.
* Agents must state in their sales particulars if anyone working there is a ‘related person’ to the seller. This is to avoid potential conflicts of interest arising. So if you want to buy or sell a property that your estate agent (or one of their associates) happens to own or have an interest in, they must declare their involvement.
* Legislation places a duty to provide the ‘material information’ that the average consumer needs to make informed decisions. So before signing a contract to appoint an agent they must inform you of such things as what services they provide, all fees and charges, terms of business and any tie-in period.
In the first instance a written complaint should be sent to the firm’s head office. If this doesn’t resolve the problem, write to local trading standards. Write to the National Association of Estate Agents ( NAEA ) – if the firm is a member.
Or ask the Property Ombudsman to review your case. If they support your complaint, they may award compensation. Estate agents with signs saying ‘Regulated by RICS’ have stricter complaints procedures.
Selecting the right agent
Anyone can set up in business and grandly proclaim themselves as ‘estate agents and valuers’. No licence or qualifications are required – which is all the more surprising given that these are the people we entrust with the keys to our homes and details of our personal finances. These are also the people whom we rely upon to vet total strangers before they are shown around our homes.
In fact agents are the only part of the home-buying process that are not regulated. To be fair, there is overwhelming support for a minimum level of competency and compulsory licensing from the industry itself. Many who pride themselves on their professionalism are only too conscious that their reputation is tarnished by a minority of unqualified and unscrupulous cowboys. But the UK Government has consistently blocked such demands, regarding them as ‘red tape’.
Yet stories still aris ein the pres from time to time about abuses, such as ‘fly boarding’ – putting up Sale boards outside properties that aren’t for sale – and arranging sexual liaisons in properties to which keys are held. This unsavoury perception is underpinned by a record number of complaints from unhappy clients – currently around several thousand a year received by The Property Ombudsman.
So how do you go about picking a good agent? A good way to start is to look for one who is a member of the National Association of Estate Agents (NAEA). Even better, pick one of the (relatively few) estate agents who are also qualified members of the RICS (Royal Institution of Chartered Surveyors), since they are subject to a strict code of practice.
But just because some estate agency firms describe themselves as ‘surveyors and valuers’ doesn’t mean they are qualified RICS members. At best there may be a genuine chartered surveyor somewhere on the payroll at head office. The NAEA has more than 10,000 members, representing around 60 per cent of the industry. Although it’s a voluntary body, members follow a professional code of practice, which if breached can land them with fines, suspension or expulsion. All estate agents are also required to join an ombudsman service that can resolve disputes and offer compensation. Some agents have additionally agreed to follow the Property Ombudsman (TPO) Code of Practice which requires higher standards, and these firms display the blue TPO logo.
So much for consumer protection. But what you primarily want, of course, is a firm who can sell your house for the best price in the shortest time. Appointing someone with good experience and local knowledge is usually the best way of achieving this, so one of the first questions to ask is how long they have personally been doing the job in this area.
Different firms tend to have their own market niche, specialising in different property types and price ranges, so it’s best to stick with agents who sell other properties like yours. That said, the Number One priority is to ensure that your property is listed for sale on leading websites such as Rightmove.co.uk – the precise brand of agent a secondary factor for people when searching.
Many branches of estate agents are not independent, but form part of a larger group. Many make most of their money from sales of mortgages, insurance and other lucrative financial services. So be aware that any recommendations you receive for associated services such as conveyancing, surveys and especially mortgages and insurance are likely to be primarily geared towards maximising revenue within the group.
Our next blog – coming soon …….
The oldest trick in the book used by (less reputable) estate agents
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