Key Facts about Estate Agents
- Estate Agents have to comply with the Estate Agents Act 1979 when acting on behalf of Home Buyers and Sellers.
- The Government is committed to reforming the house buying process in England and Wales. This includes abolishing the need for sellers to provide home information packs when homes are put on the market.
- The Office of Fair Trading can ban people from acting as Estate Agents if it considers them to be unfit to carry out Estate Agency work.
- Complaints about Estate Agents should be directed to Trading Standards, the Office of Fair Trading (OFT) or the Ombudsman for Estate Agents (OEA).
What are Estate Agents Legally Obliged to Provide? - Estate Agents are legally obliged to put their client’s interests above anyone else’s. They must keep client information confidential and obey their client’s lawful instructions. They have to report any useful information to their client that they find out, that my concern you as a seller or buyer. They have to account to their client for any money involved with their work. They are required to answer your questions clarifying their understanding of regulations and their responsibility to you and the other parties involved.
What do Estate Agents Offer? - Estate Agents offer Home Sellers:-
- Suggestions on Asking Price for your property. (Please note that this is not an official Valuation, which can only be carried out by qualified surveyors)
- Publicity Material; including House Descriptions and Photographs.
- Advertising for your House, including placing ‘For Sale’ boards at your property, advertising in their sales portfolio, placing information up in their shop window, placing information in mail handouts and press releases and passing details of your home to potential clients.
- Organizing Appointments for Prospective Buyers to View your Property.
- Negotiating the Sale of your Property on your behalf.
Estate Agents offer Home Buyers;
- Information about Properties that Match your Specification.
- Viewings of the Properties that Interest you.
- Advice about Placing an Offer.
- Specific Advice about the Property and the Local Area.
Estate Agents can tell you how much you can realistically expect to receive for your house after you have paid all the fees and taxes involved in selling a property. They can also tell you whether smarting up your house will increase the selling price.
Also let the Estate Agent knows how quickly you want to sell / purchase your property as this can affect the advice that they give you.
What are the Different Methods for using Estate Agents?
There are three different ways you can use Estate Agents to sell your house, they are as follows;
1. Sole Agency
This is when you employ only one Estate Agent to sell your house and they take full responsibility for the sale. You are then liable to pay them the agreed commission on completion of the sale.
2. Joint Agency
This is when you make an agreement with 2 or more agents to sell your property and share the commission on completion of the sale. The commission is shared, regardless of which agency makes the sale.
3. Multiple Agency
This is an arrangement where you sell through more than one agent, but instruct them independently. This means that whichever agency sells your property gets the commission; it is not shared with the other agencies.
Make sure that you check and understand all the terms and conditions that each Estate Agent has before signing a contract or agreement with them.
Are Estate Agents Regulated?
Estate Agents are regulated by the Estate Agents Act 1979, which aims to monitor the conduct of Estate Agents in the course of their work and take action when needed. However, it does not cover lettings. The Estate Agents Act 1979 lays down the duties that Estate Agents owe to their clients, such as the passing on of offers, handling money and giving details of charges.
The Estate Agents Act is enforced by the Office of Fair Trading, who has the power to issue warnings or prohibitation notices against those persons whom they consider unfit to be carrying out Estate Agency work.
What Should I do if I have a Complaint about an Estate Agent or Agency?
The first step you should take is to relay your complaint to the Estate Agents Company to see whether your complaint can be dealt with using their internal complaints procedure. If this does not promote a satisfactory response then you should report your complaint to your local Trading Standards Department or Office of Fair Trading (OFT) who enforces the Estate Agency Act 1979. (Please note that the Department of Trade and Industry does not have a role in investigating individual complaints.)
Some Estate Agents are also members of the Ombudsman for Estate Agents (OEA). The OEA Scheme has been devised to try to address disputes which arise between its member agencies and their consumers, such as home buyers and sellers of residential properties in England and Wales .
The OEA investigates complaints which have been drawn up against its member’s agency involving infringements of consumers’ rights, incompliance with OEA rules and regulations, acted unfairly towards the consumer or are guilty of maladministration. The OEA can order its members to pay compensation to the consumer up to a maximum of £25,000. Unfortunately the OEA cannot deal with disputes concerning surveys and valuations of properties or with letting or management complaints.
If you want further information please contact either the Office of Fir Trading (OFT) or the Ombudsman of Estate Agents (OEA). Contact details for both can be found below under the heading Useful Addresses.
What is Gazumping?
Gazumping is when you put an offer on a house and it is accepted by the seller, but then the seller goes back on their decision and instead accepts an offer from a higher bidder. This leaves the buyer who placed the original offer gazumped. It is incredibly frustrating to be gazumped and is potentially expensive for the buyer, but yet it is perfectly legal in England, Wales and Northern Ireland, although it has been made illegal in Scotland. Even if an offer has been accepted by a seller, the Estate Agent is still required to pass on to the seller any other offers they receive, unless the seller has told them otherwise.
What is the Government doing about Gazumping?
In Scotland gazumping is illegal as they have a law that states that a sale is legally binding from the moment an offer is accepted, but in England, Wales and Northern Ireland it is still currently legal. However, the Government has stated that they are committed to reforming the house-buying process in England and Wales, in order to make the purchasing and selling of homes quicker, easier and more efficient.
How do I find an Estate Agent?
There are many Estate Agents all over the country, so finding one should not be a problem. However, finding a Good Estate Agent is another story. When searching for Estate Agents, try to get recommendations from friends and family about good Estate Agents they have used. Also check what the Estate Agent’s reputation is like in the local area.
Single out Estate Agents who;
- Have an active Estate Agency license in good standing.
- Is an agent with a professional body, such as the National Association of Estate Agents (NAEA) or the Ombudsman for Estate Agents (OEA).
- Listed or sold a property in your area recently.
- Provide you with advice about how to best prepare your home for the property market.
- Show enthusiasm about your property and listen attentively to you.
- Instill confidence in you and operate in a professional manner.
- Bring data about nearby homes that have been sold recently.
Make sure you know who the Estate Agent is representing and pay particular attention to contractual time-frames and details of commission, before signing a contract with them.
For further information please contact the NAEA or the OEA. Their contact details can be found below under the heading Useful Addresses.
The Estate Agent has told me the Seller has received a Higher Offer what should I do?
One of the biggest complaints that the OEA and the OFT handles is for badly handled offers. People who try to increase property prices after an offer has been accepted can cause heartbreak for the buyer. Unfortunately even it is ethically questionable if a seller receives an offer that is £20,000 higher than an offer which they have already accepted then they are likely to gazump you and take the higher offer. However, a common complaint is that it is a fictional offer created by the Estate Agent, in order for them to up their commission by making the purchaser up their offer price. It is difficult to know whether it is a true or fictional offer, however you can demand to see evidence of the higher offer from the estate agent and if you still feel unsatisfied you can contact the OFT or the OEA.
Is an Estate Agent Obliged to Pass-On My Offer to the Seller?
Yes the Estate Agent is required by law to pass-on your offer to the seller, immediately and in writing. However, if the seller has told the Estate Agent not to pass on certain offers, such as those under the asking price, then the Estate Agent is not legally obliged to do so, but they have to let you know why your offer has not been passed on.
Can I Find Out Information Regarding Other Offers for the Property?
The Estate Agent is not legally obliged to provide you with information concerning other offers that may have been placed on the property. However, they may choose to advice you about the best type of offer to place.
Can I Force the Estate Agent to take the Property off the Market when My Offer is accepted?
No you cannot. The Estate Agent is working on behalf of the Seller; they are employed by the Seller not by you so their interest lies with getting the best offer for the seller. However, some Estate Agents will out of good will or at the Sellers request, this is likely to happen if you are seen as a good buyer, for instance if you don’t have your own property to sell before you can purchase, as this will help the sale to be quick and simple.
Can Estate Agents Demand I Put Down a Deposit on a Property if My Offer is Accepted?
Yes Estate Agents in England, Wales and Northern Ireland can demand that you put down a deposit on a property if your offer has been accepted, but only if they are covered by adequate insurance. The deposit must be held in a separate Client Bank / Building Society Account and a receipt must be provided to you.
Can an Estate Agent Hit me with Extra Charges and Misleading Contracts?
No, Estate Agents cannot hit you with extra charges, as they must outline at the beginning exactly how much you will be charged or provide specific details about how the costs will be worked out and give you an honest estimate of costs that you will incur.
According to the Consumers Association one of the major problems property buyers and sellers face, is badly worded or misleading contracts. Make sure that you read and UNDERSTAND everything in the contract before you sign. The Estate Agent is required to answer honestly, any questions you may have about the contract and point out anything that may be confusingly phrased. If you re unsure about anything DO NOT SIGN, make sure you check with a professional body such as the NAEA or OEA first.
In conclusion, make sure that you get recommendations for Estate Agents and that any problems, complaints you have you report them to the relevant professional bodies. If you require any further information or you need to check contracts with a professional body, contact the NAEA, OFT or OEA.