Selling Agents - How to tell if they're Legit/Scam?

[Futurist]

G'day,

This is just a general question about the Selling Agent for Off the Plan properties.

How can one tell if the Selling Agent advertising for OTP sales for new appartments is really the official selling agent the developer has chosen?

My paranoid mind has got me thinking.. can an Agent advertise and 'mock up' contract signatures to get your 10% deposit cheque into their account/trust fund, and run away with it?

This has stemmed from seeing so many OTP appartments being advertised by really SMALL real-estate agents that are suburbs away from the property location.

To me it doesnt sound right. If I was going to sell 20 OTP properties, I would want to advertise it with a known Selling Agent..(Raine and Horne, LJHooker, McGrath etc etc you all know the ones I'm talking about).. And not a 'nobody' selling agent kilometers away..

As an example. this selling agent only has 4 OTP sales, and 1 rental advertised on Domain.com.au.

a. Could this be an indication that its dodgy, or am I just over thinking it?
b. Is there a way that my solicitor will be able to check the legality of the Selling Agent?

 

[The Y-man]

Yes one did and stole our $30,000 deposit many years ago.

The Y-man

 

[Futurist]

Bummer.. So sorry to hear that Y-man.!

Nothing was suspicious I imagine?
Or was there anything that your Solicitor should have picked up or anything like that?

I don't suppose u have any words of wisdom (in hinds sight) to share, to help identify these scams and checks that we can do?

 

[mattysavager]

It's actually fairly common for OTP sales to go through 'local' agents rather than big players.

It's about increased exposure for the developer. OTP sales usually first go through the in-house sales team until that avenue slows down, and then it's anyone's game. Open listings galore.

Smaller agencies are often best positioned to sell these types of apartments, as the client/buyer database can be in a buying position rather than 'just looking' and the personal service can often quell fears that the buyer is going to get ripped off by the big-shot developers.

Matt

 

[Tony3008]

When I bought my two OTP apartments from Central Equity the deposit went straight to their solicitors.

 

[Futurist]

I'm just seeing an influx of small chinese realestate agents selling exclusively for new OTP appartments. And have been wondering why this was the case.

Perhaps the agents have a global entity, and the developer wants to attract overseas buyers aswell ? Thats' the only reason I came to, to explain why...

Still a bit hesitant being a noname agent and all.
A friend has suggested the use of a Bank Guarantee instead of a cash deposit.

Would this be a more secure way of going about it if the agent is a rogue/scam agent ?

 

[The Y-man]

Bummer.. So sorry to hear that Y-man.!

Nothing was suspicious I imagine?
Or was there anything that your Solicitor should have picked up or anything like that?

I don't suppose u have any words of wisdom (in hinds sight) to share, to help identify these scams and checks that we can do?

Just make sure they are a registered agent first up

https://online.justice.vic.gov.au/cav/bla-search-criteria?mode=E

Make sure any deposit goes to agent's trust fund (we were young and stupid - wrote it to the company, which wasn't even a registered REA - but then we weren't the only ones caught out by this fella)

The Y-man

 

[The Y-man]

I'm just seeing an influx of small chinese realestate agents selling exclusively for new OTP appartments. And have been wondering why this was the case.

This is actually not that strange.

Due to the FIRB, overseas buyers can only pick up OTP (and since they don;t have a choice, they prices can be marked up beyond what can be sold to a local market).

These agencies you mention are there to sell direct to the overseas market - eg Chinese market (in TW, HK, PRC etc), with very few sales expected here.

The Y-man

 

[Futurist]

./sigh..

I guess being overseas and loaded, they wouldnt care that much for the hiked up prices.
But the effect that will have on our property market kinda sucks..

Ty for your thoughts. It indeed makes sense of it all

 

[Futurist]

So I've been thinking..

If these OTP sales are price hiked for overseas buyers..

Then I'm guessing its an obvious sign for us property investors to best avoid it..
As the prices are mostly hyped up way above market value.?

 

[Scott No Mates]

You can always check to see if an agent has a licence on the fair trading website if you are diligent.

In many cases, the developer will be selling OTP but will also have as many agents out there (who have investors looking for OTP). These agents will have a conjunction agency or non-exclusive agreement in place with the developer.

 

[The Y-man]

Then I'm guessing its an obvious sign for us property investors to best avoid it..
As the prices are mostly hyped up way above market value.?

As a rule of thumb for many reasons in addition to this, I avoid OTP or even brand new (unless I'm living in it for lifestyle reasons).

The Y-man