Agents: Watch for low- ball offers
No matter what channels they go through to sell their property, we suggest that people engage a lawyer to help them navigate the process right from the start Real Estate Agents Authority chief Kevin Lampen- Smith
Real estate agents are being warned to watch for collusion by property investors after revelations in last week’s Weekend Herald.
The industry watchdog has issued a reminder to agents to protect their clients and watch out for tactics designed to artificially drive prices down.
Last week, the Weekend Herald revealed Auckland property t ycoon Ron Hoy Fong had coached investors to work in packs and place multiple low offers on properties to secure bargains.
In a coaching video distributed by the Auckland Property Investors Association, Fong also suggested investors give vendors false names and target the “seven Ds” — including deceased estates, desperate homeowners on the brink of mortgagee sales and “dummies” who don’t know the value of their home.
Real Estate Agents Authority chief Kevin Lampen- Smith said Fong’s advice for investors to collude to keep prices low and target vulnerable sellers was a reminder to licensed agents to protect homeowners.
“Real estate agents are expected to continually upskill to stay on top of changes to legislation and current requirements.
“They should also be aware of trends in the market that may have an impact on their clients so that, given the circumstances, the best price is achieved.”
Lampen- Smith also took a swing at unlicensed house trading companies who offered “no- commission, fair offer” private sales.
It followed the case of Mangere pensioner Sarah Ewe, who sold her family home of 52 years in under three hours to investor Peter Lee without receiving advice from her family or lawyer.
Lee later abandoned the contract after Ewe’s family took legal action to halt the sale when it emerged she had likely sold her house considerably under value. She told the Weekend Herald she did not realise she was signing a sale agreement.
Lampen- Smith said Ewe’s case underscored the need for people to be mindful of their rights and responsibilities when selling real estate.
“No matter what channels they go through to sell their property, we suggest that people engage a lawyer to help them navigate the process right from the start.
“Property transactions are complex deals that involve big sums of money and a lot of emotion, and impartial legal advice is invaluable.”
He also recommended sellers use licensed agents, rather than engaging private house buying companies, who operated largely free of regulation or industry codes of conduct.
“If you sell your home privately, you do not have the same access to redress if things go wrong. A licensed real estate agent is there to help you navigate the process and get the best result.”
The Commerce Commission i s looking into the video and APIA has withdrawn its distribution. Both Fong and Lee have denied acting unethically.