Help!!! Agent lied to me.

Hi guys

I need some urgent advice here.

I made a written offer on a house today for $565,000 unconditional. The agent said that if I put in $5k more unconditional I will get it. I agreed.

Anyway, I have since found out from the brochure for the property that it was auctioned last month (Dec 19) but it was passed in on a vendor bid of $550,000.

Now, when I asked the agent when i first saw the property how long it had been on the market, he said that it was listed just before Christmas, and that we were one of the first ones to see it.

I feel like I have been cheated and lied to.

The agent is going to fax me through the contract with the new price which he asked me to countersign. I haven't done that yet.

What should I do????? I don't want to pay $570k on a property that had been passed in at $550k. HELP!!
 
when I asked the agent when i first saw the property how long it had been on the market, he said that it was listed just before Christmas, and that we were one of the first ones to see it.
I'd say that he means "after it got passed in at auction, we listed it for sale via private treaty just before Christmas".

In any case, I don't see what relevance this information has if you've done your due diligence. If you're not sure what it's worth, and now think $570K is too much, then you're not ready to buy a property. If it is worth $570K to you, then who cares what happened at the auction? Only a proportion of buyers are able to buy under auction conditions, anyway, so auction prices are (IMHO, unless it's a highly sought after, unique property) usually lower than private treaty prices.
 
REA lying....what is the world coming to!!! :D

Is the property worth what you are offerring? The answer to this question is the answer to whether you should sign or not.
 
The agent is going to fax me through the contract with the new price which he asked me to countersign. I haven't done that yet.

What should I do????? I don't want to pay $570k on a property that had been passed in at $550k. HELP!!

Hi Cam2be,

Based on your post - you haven't signed to the $570k price yet, so you're fine - if you don't want to pay $570k - just don't sign it. You can continue negotiating, or walk away.

Cheers
Jen
 
What should I do????? I don't want to pay $570k on a property that had been passed in at $550k. HELP!!

I don't quite get this.

Keep in mind VB's a quite literally figures pulled out the ar...ughhh, air. Having said that, I beleive they are never above the price at which the vendor wishes to sell at.

So had you known:

1. what offer would you have put in?

2. Let's say you put an offer in at $550 - i.e the pass in price that the vendor DEFINITELY would not sell at. The agent comes back to you and says, look $570 will definitely buy it .... would you take it?

Lastly - if you can out of the deal - what if it sold the next day at $580k?

So maybe the issue is not with the price at all - perhaps you are simply wanting not to proceed with this deal because you were lied to? (and that is perfectly understandable from a moral perspective, and I would applaud you for sticking to your convictions)

Cheers,

The Y-man
 
I went to an auction recently where myself and many other bidders didn't register to bid because we all assumed the property was going to go for a LOT more than that the agent said was the expected selling price. It reeked of a low ball tactic.
Well, on auction day, nobody bid. There was a vendor bid bit none of the other prospective buyers had registered, so the property had to sell by private treaty.
This was a property worth, say, $500k and it would have been passed on with a $400k vendor bid.
Just one of those rare auction days where you wish you have pre approval and had registered to bid. An anomily.
So, just because it's passed in at a low bid, doesn't mean it's not worth a much higher figure.
At the end of the day, property values are highly subjective. It's worth what someone is prepared to pay on the day.
 
The beauty of Melbourne auctions is that there's absolutely no pre-registering of bidders, you can literally just walk up during the auction and bid without having ever spoken to the REA or even viewed the property.
 
Auction pass in figures don't always mean too much. My parents paid $876K for a house that passed in at auction a few months before for $700K.

Like others have said, if you think it is worth what you have offered, relax. If not, don't sign.
 
In my opinion, the real estate agent hasn't lied.

It was handed in at the auction for $550k, which could mean anything. As said not everyone can bid at an auction. If you were willing to pay the $570k before finding out the information, then it shouldn't matter the price it was handed in, or the fact that the agent said it was listed just before Chrissy.

I can't see where the REA has lied, in all honesty. I may have overlooked something in your original post.

But i'm agreeing with Ozperp, that the REA meant that it was listed for sale by private treaty.
 
I don't quite get this.

Keep in mind VB's a quite literally figures pulled out the ar...ughhh, air. Having said that, I beleive they are never above the price at which the vendor wishes to sell at.

So had you known:

1. what offer would you have put in?

2. Let's say you put an offer in at $550 - i.e the pass in price that the vendor DEFINITELY would not sell at. The agent comes back to you and says, look $570 will definitely buy it .... would you take it?

Lastly - if you can out of the deal - what if it sold the next day at $580k?

So maybe the issue is not with the price at all - perhaps you are simply wanting not to proceed with this deal because you were lied to? (and that is perfectly understandable from a moral perspective, and I would applaud you for sticking to your convictions)

Cheers,

The Y-man

Y-man, you've hit the nail in the head there. I don't expect agents to tell me everything, but I don't expect to be blatantly lied to either. If he had told me that it was passed in at auction, I would've checked the auctions results and use the PI price as a ball park figure to start my negotiation. Vendor would've accepted $555 or $560k - who knows?

I should expand on what happened. Not only did he say that we were one of the first to see the property and that it was listed just before Xmas, when the agent presented me with the contract to sign, I asked why the finance clause had been deleted. He said that the property was originally for auction but it was cancelled, therefore the clause was deleted as auctions are unconditional. Blatant lie.

Anyway, I asked an agent friend of mine who works in the area for advice. His opinion is that the property is located in one of the best streets in the area, and houses frequently sell for $600K+ there. My DD done prior to making the offer shows comparables selling for around $600k.

Having said that, I still feel hard done by. Is it worth trying to retract the extra $5k and to also make the contract conditional on finance? I'm prepared to walk away if the vendor doesn't agree to this. Thoughts?
 
The beauty of Melbourne auctions is that there's absolutely no pre-registering of bidders, you can literally just walk up during the auction and bid without having ever spoken to the REA or even viewed the property.

Further to jonathons post....this worked in my favour at a recent auction. I obviously went under the radar as a prospective buyer despite having viewed the property on two occasions with children in tow.

On auction day I watched the agents literally s**k up the bottoms of those that they thought were potential buyers. No one came near me. I stood at the back & started my bidding when it came to the agents 3rd & final bid. I had my kids in tow as my husband was at work. The agents were blown out of the water. I bought the property at less than what I was prepared to pay after doing due diligence & it rented within 1 day at higher than market value.


I honestly think that if you have done your research & you think it worth $$xx then just pay it. In a couple of years after capital growth the original price will be neither here nor there. It will cost you far more by doing nothing.

Above Average
 
Is it worth trying to retract the extra $5k and to also make the contract conditional on finance? I'm prepared to walk away if the vendor doesn't agree to this. Thoughts?

What you should do depends on how valuable the property is to you.
Is this purchase an investment?
I wouldn't worry about the money too much.
$5K is 1% of the property price and the property value can fluctuate that much overnight.

Try to win on the conditions.
If the property was the one I want, I'd probably tell them that my solicitor advise me to make the contract subject to passing pest & building and finance approval.

If the building inspection does not come back clean, you can go back and renegotiate the price or you can walk away.
 
I agree look past the muck and see it for what it is worth - you are wasting your time fretting about the agent- wont be the first and most certain wont be the last
 
For goodness sake, I really don't see what all the fuss is about. You said similar properties are selling for around $600k, and you have secured this one at $570k. Who cares about the auction? That is totally irrelevant. If you are fretting about that, I have to wonder if you are cut out for property investing.
 
Cam2be


Is this a PPOR for you?

ACTION - You wanted to buy a house.

Obviously the seller and yourself have agreed on a price via negotiation and you think the price is fair and have verified this with a mate and your own research.


Ensure the 'finance, building and pest inspection' clauses are in contract.


Incidental problem/issue...

The REA has said things which have destroyed your trust in him or her.

Address this problem by discussing the facts with REA and informing them that they have destroyed your trust in them and you could not recommend them or the agency to any of your friends, relatives, sport or work colleagues now or in the future.

OR you can go to the trouble of writing a letter to the REA and /or principal, making the letter factual.

The choice is yours as to how you handle the problem, I suggest most people would just tell 10 people of their bad experience and these 10 people would tell 10 other people of your bad experience!


BUT don't let the house get away if you think there is value in it and it suits your requirements to purchase.

Think of all the time and effort you have put in so far + plus the lesson you have learned to check auction results yourself.

When ever something like this happens to me I just say to myself I am paying for my own education/experience.


Kind Regards
Sheryn
 
There are many examples I can cite that properties, when after being auctioned and not sold, are relisted on the realestate websites as new. Unless you knew it was auctioned, it looked for all intents and purposes like a newly listed property. Same issue?

You say yourself you are potentially purchasing a property for $30k below what you think is fair value. Sign for goodness sake. And if you are still not happy with the agent, then Sheryn has some pertinent advice.
 
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