Buying or selling real estate is something most of us experience at some point in our lives. The process can be long and difficult sometimes but in the end a successful transaction is profoundly rewarding.
Closing a transaction on a home for a first time home buyer will put a big smile on their face, knowing that they have achieved their dream of homeownership. Selling a home can be just as rewarding, because of the new possibilities it can open up, whether that’s the purchase of a new house or just a hefty deposit in your bank account.
There are many factors that could determine the success or failure of a real estate transaction, but probably one of the most important is finding a real estate agent that is skilled and trustworthy. While most real estate agents are committed to helping their clients find their dream house, there are those who have a much more cynical outlook on the profession.
Why you need a realtor
This being the case, you may be wondering: “why use a realtor in the first place?” The truth is, there are very few people who would go into the real estate market to buy or sell without a realtor. On the other hand, trusting a stranger to help you with something that is as big as buying or selling a home is not an easy decision to be made.
The trust shared between a real estate agent and their client is crucial for the success of the transaction. That’s why figuring out how to choose a realtor might be a crucial step before you even think about buying or selling a house. This article will try to provide some tips on how to tell whether or not a real estate agent is upright in their dealings, and illustrate how important it is to trust your realtor.
What are the signs of a bad real estate agent?
During a real estate transaction, it is essential to work with skilled and professional real estate agents. Good real estate agents aren’t particularly difficult to find; whether you find out about them from friends or online reviews, the best realtors come highly recommended. But what exactly is a “good” or a “bad” real estate agent? Well, you see, opinions might vary from one person to another.
Agents might be very informative, but not all homebuyers can handle the overwhelming amount of information. No two buyers are the same, and each sale must be approached differently. Closing a real estate transaction can be somewhat tedious, but a good agent is there to guide you and help you successfully complete your purchase.
While most real estate agents act professionally and are able to deliver, others might lack certain qualities that real estate agents really need in order to deliver the best services. But how do you know if you are dealing with an inexperienced agent? What are the signs of a bad real estate agent?
Things to look out for
Even the trust between a client and a service provider is built upon the most fundamental principles in human interaction. Here are some of the aspects, bad real estate agents fail to apply in their relationships with clients.
1. Lack of communication is always detrimental to any relationship and between a real estate agent and their client. This can ultimately affect the transaction in a highly disadvantageous manner. However, it’s important to take into consideration the fact that some clients' needs are disproportionately greater than others, and that your real estate agent may be dealing with other clients while they are engaged with you.
While there are certainly bad real estate agents, there are also bad clients. While it may appear that a real estate agent is neglecting to communicate with you, they might just be spending their time dealing with a particularly difficult or demanding client. Having to deal with customers who demand their attention at every moment is an unfortunate but unavoidable part of a real estate agent’s daily life.
One of the top complaints about real estate agents that disappointed clients is the fact that they can’t get in touch with their agents on demand. Try your best to not be demanding and remember agents also have their own families and responsibilities outside of work. If you don’t have an urgent concern, try to limit your communication to essential matters. This will help you avoid forming any misconceptions about your real estate agent.
2. Another sign of a bad real estate agent is the lack of confidence. The best real estate agents exude quiet but unshakeable confidence that inspires trust. Believe it or not, even the car a real estate agent is driving can show you how confident he is.
An agent that doesn’t trust his abilities will not be able to represent you effectively. Confidence is crucial not only when you interact with the agent, but also at the negotiation table when making sure you don’t get the short end of the stick in this situation.
3. Being unethical and dishonest is another red flag, and something that separates bad real estate agents from good ones. If an agent pushes you to make false claims when advertising or lies about disclosures, walk away immediately. Gossiping about other agents or spreading negative information is another sign of unethical behavior, so make sure you work with agents that uphold ethical conduct.
4. Lack of leadership is another thing you should be aware of when you are looking for a realtor. Many clients are probably first time buyers or sellers, so they need to be guided and it takes a good leader to do so. An agent should give you proper advice based on their experience and expertise in the field, even if it is not in his/her best interest. That’s why a lack of leadership is never a good sign when you are looking for a realtor.
5. An agent that is non-cooperative is one of the reasons why real estate agents fail to be trustworthy in their client’s eyes. The counsel of an agent is important since they are the professional and have the expertise, but the client needs to be heard as well. As a client, you might not be as knowledgeable as your agent in terms of the housing market, but you are entitled to an opinion in matters that concern you.
A professional agent will listen, exchange opinions and find solutions together with their client that benefit the best interests of all parties. Cooperation is a lot easier when you work in a team, and having a team of real estate agents on your side will be of great help when dealing with any cooperation issues.
Common tactics used by bad realtors
You may be wondering to what extent a real estate agent can go in order to close a deal. Some real estate transactions might be detrimental for the real estate agent in terms of profit, while others appear to be the opportunity of a lifetime. But, is every transaction fair and transparent, without any hidden interest behind it?
The answer is no, unfortunately. While the majority of transactions are legitimate and completed according to applicable state laws as far as real estate transactions go, these laws have loopholes that can be exploited by unscrupulous realtors. In order to create both a safe and profitable exchange for all the parties involved, it’s important to do your due diligence.
While ethics play a huge role in the real estate world, and real estate agents have to maintain ethical conduct while at work, not everyone feels morally obligated to follow the rules especially when there is a lot of money involved. As they say, power corrupts; in western society, what has more power than money?
As you know real estate is one of the best ways to invest your savings, and becoming a real estate investor is a goal many strive towards. However, because it is such a profitable industry some real estate agents use a variety of unscrupulous tactics in order to obtain a profit or something in return. Here are some examples of real estate tricks played by some real estate agents that you should be aware of.
Starting a bidding war
One of the oldest tactics in the book is the bidding war. This is a somewhat self explanatory concept; a real estate agent’s income is commission-based, so the higher the selling price the better. While it is difficult to sell a house for more than it is worth, it is easier to start a bidding war in order to raise the selling price.
In this case, the agent might try to give the impression that a lot of people are viewing the property. Rather than going through one offer at a time with you, he might be willing to place you in a position to bid against other buyers by pushing one property.
Open houses also encourage buyers to act quickly and start a bidding war. This often occurs in places where a bidding war is unlikely to start organically, such as marketplaces that are not competitive. However, if you see this happening and you are in a position to bid against another buyer, don’t act rashly. This may just be a disingenuous real estate agent trying to get the best possible price for the seller.
Drive the offer up by creating false offers
Another trick that some real estate agents might resort to is known as the phantom offer and it is meant to drive the price up. You made your offer and it seems like the deal is sealed and the property is off the market, but suddenly you receive a phone call from your agents, letting you know that there is another offer that is higher than yours.
If you are suspecting a false bid, then you should ask for proof of the offer. Whether the offer is real or a hoax, it might cost you money so it is good to avoid such situations. Some means to prevent such a hoax is through a “good will charter”, where both parties have to pay a deposit that is going to be lost if the sale doesn’t go through. It is not a bullet-proof solution but it may help give you an idea whether people you are dealing with are serious about the deal or not.
It is however unlikely that this might happen because if the fraud is proven and a lawsuit is intended this might attract serious consequences for all parties involved.
Fake listings or old listings to attract buyers
Another trick that some real estate agents might resort to in order to get more clients is by using fake listings or old listings. A fake listing has vague pictures, few details about the property, and usually it won’t have an exact address. In this case, the property might be listed in a hot area and it might seem like a steal.
When buyers call, they say that the property is no longer available or has been put under escrow and then they follow up by telling you that there are other similar properties they can show you.
The same happens with old listings where agents leave a property on their website that has already sold in order to get buyers to call and inquire. This will ultimately lead to more buyer calls and more leads. It is a misrepresentation and a trick that is hard to spot because it seems so innocent, to the point where a simple excuse such as “I forgot” works so you should pay attention not to fall for it.
Having a solid foundation of trust underpinning your relationship with your realtor is crucial for the success of any real estate transaction. That is why good real estate agents abide by the highest ethical and moral standards in order to represent clients in the best way possible and act professionally.
However, not all abide by the same principles and this may lead to realtors using unethical or outright fraudulent tactics in order to receive a more consistent commission or get more leads. Finding a good real estate agent may prove a greater challenge than you might think, therefore start by paying attention to some of the bad practices that agents might have and try to spot the right agent for the job.
In spite of the bad reputation some agents might get, there are plenty of professionals out there who love their job and build their relationship with clients based on trust. Have you ever had to deal with bad real estate agents or what is the best experience you ever had with a real estate agent? Let us know in the comment section below!