Today with Sean O’Rourke: Some of the problems with the Property Market

We were asked to discuss some of the problems in the property market with Sean O’Rourke and Philip Farrell of Real Estate Alliance.

There are issues such as gazumping with other bidders, gazumping where there are no other bidders, under-pricing to increase interest and timed viewings which create an ‘auction type environment’.

It is incredibly difficult for estate agents to manoeuvre their way through this without upsetting somebody (and it can’t be the vendor who is their ultimate client). This is why we should consider some small rules where people get punished for anti-market behaviour such as the vendor having to pay a buyer a certain sum if they pull out after the contract is signed.

This isn’t going to stymie anybody, remember, it is only after the booking deposit is paid, accepted, and the contract sent out, signed and returned that this could happen.

An unintended consequence may mean that contracts don’t get sent out very easily in the future, but can we believe that people would avoid getting contracts sent out? That’s unlikely, some kind of structural change …

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Estate Agents – amazing how nothing has changed

Something which never ceases to amaze me is how estate agents have such an uncanny ability to capitalise on any opportunity. It’s really something to be admired, the absence of a hard sale makes it particularly difficult to spot, but like sharks who can smell blood at one part per million.

One should clarify, I like estate agents, it doesn’t mean I don’t know when they are making a market. The recent practice of only having three viewings or viewings that can only take place in one week is a recent addition to the toolbox which is designed to have a few effects.

This was something I thought was a bit sharp but rare, then today encountered three times in an afternoon of making calls. The method goes as follows:

1. List a property at a price so keen that it is bound to attract a lot of interest.

2. Field lots of calls as interested buyers ring in, about 7/10 will be tire kickers because the true price sought is way over list but the innocent/uninitiated will show …

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