Catching Dodgy Agents an article by Neil Jenman

September 29, 2023

Catching Dodgy Agents an article by Neil Jenman

We agree that auctions can achieve a lower selling price. That’s why we are proud to be a Jenman Approved agency.

Neil's recent article below explains what is happening every weekend all around Australia.

There is a smarter selling method for sellers!

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Contact us today for your free appraisal and we can send you booklet on selling for the highest price.

- Tim Altass

 

Article authored and provided by Neil Jenman, a reputable author and real estate customer crusader. Neil Jenman is widely recognised as Australia's trusted defender of consumer interests. He extends comprehensive assistance throughout your selling journey, assisting you in selecting an agent who guarantees the highest price and honest service. This unparalleled level of support comes at no cost to you.  For additional information, please visit www.jenman.com.au

 

CATCHING DODGY AGENTS by Neil Jenman

If it wasn’t so serious, it would be hilarious.

There are strict laws in most states about auctions. But these laws are rarely enforced. When the authorities do decide to enforce the laws, they have no trouble finding agents who are breaking the law.

This is what’s happened in Victoria recently. The state’s Consumer Affairs (CAV) has been fining agents thousands of dollars for breaking false quote laws.

Typically, what happens is this: Agents tell buyers that a home will sell well below the price the sellers want.

For example, the sellers want, say $1.5 million.

But the agent will quote the prospective buyers a false low quote of, say, $1.2 million. The theory is that this ensures a large crowd at the auction – all expecting to pay far less than the owners want, of course.

This false quoting scam happens every weekend with most agents at most auctions. So, it’s no wonder that, over the past few weeks, Consumer Affairs Victoria have caught plenty of agents.

Aside from breaking the law, what “underquoting” does is cause homes being auctioned to be under-sold. The agents tell the owners – on a nudge-nudge, wink-wink basis – that if they quote a low price they will attract more buyers.

And they are right. More buyers are attracted by the false low quotes. But many only want to pay the price that was quoted.

The agents then put extreme pressure on the sellers saying such things as: “This is what the market is saying.”

But the agent has been looking in the wrong market!

If you want to sell your home for, say, $1.5 million, the first thing you need to do is attract buyers who can afford to pay $1.5 million.

This is just another reason why you should never sell your home at auction. In the book 88 REASONS WHY YOU MUST NEVER SELL YOUR HOME AT AUCTION, this is Reason Number 9.

REASON 9 - THE LAW WON’T HELP YOU

Real estate agents routinely break consumer protection laws. They have almost no fear of being prosecuted – for two reasons: First, every agent seems to be breaking laws under the Fair-Trading or Trade Practices Acts and, second, the authorities rarely prosecute agents. Even laws under the Crimes Act, most notably “obtain a financial advantage by deception” the very definition of fraud, are blatantly breached.

The first time I appeared on television about auctions, I said, “The auction system is a fraud.” A well-known Melbourne agent said, “I take great offense to that remark.” He gave his usual pitch about his integrity and longevity in real estate. This agent – like all auction agents – had been misleading sellers and buyers for years. He was never challenged by authorities. Even after the program aired on national television with hundreds of thousands of viewers, this agent – along with many agents – kept telling lies. It was more than 20 years before his agency’s conduct became too brazen to ignore. Government inspectors examined 22 of his company’s auctions and found that all involved massive deception. The Federal Court imposed a penalty of $880,000. That got the attention of agents. For a while. But soon, they were brazenly breaking laws again. As they are today – and every day. No fear of attack or penalties. A law unto themselves. As they have been for years.

When a Melbourne barrister sued an auction agent for under-selling his home by at least $200,000, the case was dismissed. The judge said the barrister was well-educated; he should have known better. Everyone knows auctions are a “farce”.

The boss of the Real Estate Institute said the judge did not understand auctions.

Understand this: Auctions are riddled with deceit, and consumers have little or no redress.

If this one reason is not enough to have you convinced or if you would like to know the other 87 reasons contact Tim Altass Real Estate for your free copy with every free appraisal

 

 

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