Eight Deceptive Strategies Real Estate Brokers Might Employ
Navigating the world of real estate can be challenging, especially when it comes to avoiding potential scams. With over 3 million real estate professionals in the U.S., finding the right one to guide you through the process is crucial. However, not all agents are created equal. In this revamped guide, we'll explore some of the most subtle scams that unethical agents may employ, making sure to sprinkle in some helpful knowledge from our enrichment data.
Sketchy Referrals: The Silent Salesman
Real estate agents often help you connect with other professionals, such as mortgage brokers or home inspectors. While this is generally part of their service, it can cross the line if they insist on using their referrals or push you to choose them over others.
To avoid this, take the initiative and seek out recommendations for all the services you need. Remember, you're not obligated to use your agent's suggestions – getting several quotes will give you a clearer picture of who's best suited for the job.
Buying a Listing: Caveat Emptor
Choosing the right real estate agent when selling your house can be tricky. Agents know they're competing for the commission, so they'll go to great lengths to convince you that your property is worth more than others believe. This tactic, known as "buying a listing", can lead you to set an unrealistic price, only to face disappointing offers later on.
To avoid this, do your research thoroughly. Get several estimates on what your property's worth, and inspect comparable properties in your area to see how your house stacks up. If an agent's suggested listing price is significantly higher than the rest, be wary.
Steering: When Agents Guide You Off-Path
Working with an agent can sometimes feel like a guided tour of houses. However, if you begin to notice that your agent never shows you properties in specific areas or ignores your preferences, you might be dealing with "steering".
Steering can be subtle and hard to spot, as the agent may claim to be acting in your best interest by showing you only suitable properties. But if you suspect that your agent is only displaying properties within certain areas, it may be worth exploring other options.
Personal Property Manipulation: Not as Harmless as it Sounds
Sometimes, agents will help you reduce your future tax burden by assigning a portion of the sale price to "personal property," such as furniture or appliances. While this is not necessarily illegal, it can be misleading and potentially lead to legal consequences.
To protect yourself, ensure a thorough inspection of the property before signing any documents. Hiring a professional inspector can help you identify hidden problems and ensure that there isn't any manipulation taking place.
Lax Marketing: Agents Who Slack Off
When you hire an agent to sell your house, they should be actively marketing it to potential buyers. However, some agents may cut corners and do the bare minimum, relying on the high demand for properties to close a sale.
To ensure your agent is working hard to sell your home, make the marketing plan a part of your contract. Regularly check in on your agent to see how they're promoting your property and verify that the agreed-upon marketing strategies are being implemented.
Bait Listings: The House That Wasn't
Have you ever stumbled upon an amazing listing that seemed too good to be true, only to discover it had already sold? You might have fallen victim to a bait listing, a tactic used by some agents to attract potential clients.
To avoid this, conduct thorough research on listing agents and their reputation. Be cautious of houses that are significantly underpriced – they might be bait listings designed to reel you in.
Off-Market Sales: Going Undercover
Agents may sometimes suggest selling your home off-market, claiming that it will save you time and money. While this may be true in some cases, it can also lead to potential pitfalls and hidden costs.
If an agent suggests selling your property off-market, be wary – this could potentially lead to a triple commission for the agent, leaving you with less money in your pocket. Aim for transparency and consider using a lawyer to ensure the transaction is conducted fairly.
The Ghost Buyer: Are They Really Interested?
Unscrupulous agents may sometimes invent phantom buyers as a means to manipulate the market. In some cases, they may use the prospect of a ghost buyer to persuade you to hire them or agree to a higher offer.
To protect yourself, research listing agents thoroughly and choose one who aligns with your needs. Be wary of any unrequested offers or sudden changes in the market, and be prepared to walk away if something seems off.
By being aware of these subtle scams, you're better equipped to navigate the real estate market with confidence. With diligence, research, and a healthy dose of skepticism, you can make informed decisions and avoid potential pitfalls.
- Despite the numerous real estate agents available, some might resort to unethical practices such as 'steering,' where they guide you towards specific properties or areas that may not align with your needs, to secure a commission.
- In the realm of real estate transactions, 'buying a listing' is a scam where agents might artificially inflate the value of your property to secure the listing, resulting in an unrealistic price expectation and potential disappointment later.
- Uncommon but still prevalent, some agents may engage in 'personal property manipulation' by assigning a portion of the sale price to personal items like furniture or appliances, potentially leading to legal consequences if not addressed properly during the property inspection and documentation processes.
