Dealing with real estate agents

Most real estate agents I’ve dealt with have been professional, knowledgeable, and genuinely care about providing a good experience. However, it's important to remember that the agent works for the seller, not you. There are some tactics agents might use, especially if you're a first-time buyer, so here's what to watch out for.

Buying agents

Most real estate agencies have buying agents who help serious buyers find suitable properties. They work on commission, so they usually only assist committed clients and are free for buyers. While you don’t need a buying agent—and many don’t work well with first-home buyers—you might find one willing to help. If you do, always contact them first before viewing a property, as they only earn a commission if they’re with you on your first visit.

Selling agents

Selling agents (also known as listing agents) list properties for sale. They work exclusively for the seller and are incentivized by the seller’s interests. It’s essential to keep in mind that their goal is to secure the highest price for their client, not necessarily help you as the buyer.

Good things to know

Disclosures and predictions

While real estate agents are legally required to be truthful, the reality is that some may work with the seller to keep issues hidden. If the vendor doesn’t disclose something, the agent isn’t obliged to mention it either. That's why it's crucial to never take everything the agent says at face value—always verify the details yourself. Some agents may even inflate certain aspects of the property to make it sound more appealing. You'll learn to spot the preposterous propositions being made soon enough, and here's some of my favourite gems:

• Power pylons are very close by; agent remarks Transpower is actively planning to underground the national grid in Auckland in the next 5 years!

• Master bedoom faces a cemetary; agent remarks it's a "quiet park".

• Neighbours are being rowdy; agent remarks they're seriously considering selling, despite having lived there for more than 30 years!

By being diligent and verifying the information for yourself, you can avoid falling for some of these misleading sales tactics and make more informed decisions.

"Market Feedback"

A helpful tactic is asking agents for "market feedback," which typically gives you a sense of what the seller expects for the property based on previous viewings or offers. Good agents will share a number or range, helping you determine if you're in the right ballpark for your budget. Be aware that agents may manipulate this feedback:

• Lower feedback can create a sense of urgency and draw more people to the auction.

• Higher feedback can be used to anchor the price and attract buyers who are less familiar with the property’s value.

Be mindful of this.

Private viewing

Agents can arrange private viewings for you, so don't hesitate to ask them to see it outside of an open home. Most will happily oblige for serious buyers.

Bad tactics

Brushing you off

Some agents may brush you off at open homes, giving you the impression that you’re not a serious buyer. This is a tactic to make you feel desperate and push you to make an offer quickly. Don’t let their attitude pressure you into anything.

Pressuring you to make an offer

Agents will try to get you to say a price, and make an offer on it. The offer is so the agent can take it back to the owner as proof that they’re working hard for them, and also as ammunition to prepare them if their expected price is too high. Don’t make offers on property unless you actually like it, and be prepared for agents to talk price with you, then come back and tell you no - they’re trying to play you.

The pre-auction offer

Agents love a pre-auction offer (you’ll see what I mean after a few open homes). This is when you make an offer that’s acceptable to the vendor that brings the auction forward. Agents will claim it lets you cut out the competition and lets you win faster. Try avoiding this because the only person that really benefits is the agent – they can sell the house in a shorter timespan and have to do less work. Also, if the price is acceptable to the vendor, it will also be acceptable two weeks later at the actual auction day too.

The multi-offer offer

You try to make an offer on the house, and the agent tells you others have made offers too that are more competitive. Don’t fall for this, they’re trying to shake you down for more. Just present the offer you deem appropriate. One of two things will happen – the vendor will accept the higher offer, which is fair game, or the agent will call you in 2 business days asking for the original offer, making an excuse about the other buyer pulling out.

Undervaluing the house

One of the most frustrating tactics is when an agent tells you the market feedback is lower than it really is. They may tell you a property is worth $1 million when the reserve price is actually $1.2 million. This strategy is designed to get buyers excited about bidding, creating the illusion of demand. Always do your own homework and valuation. If something seems too good to be true, it probably is. Remember, there are no real bargains in Auckland’s market.

Being prepared and aware of these tactics will help you stay in control and make informed decisions while navigating the property market.