We wouldn’t question whether estate agents are dodgy or not. Everyone knows that they are. The traditional, High Street variety in any case.
The question is, perhaps, why are they seen as so utterly dishonest?
Estate agents have a reputation that, depending on which survey you ponder, sits somewhere below tabloid journalists and politicians. In pure hatred terms they compete with traffic wardens and bankers for the title of most detested profession.
The perception reality of a complete lack of communication, care, empathy and efficiency on the part of most estate agents can possibly be explained by the hands off approach that successive Governments take to regulating the business of selling houses. No licensing. No real oversight at all except for a well meaning but barely known Ombudsman scheme and a puny, supposed professional body known as the National Association of Estate Agents (NAEA) which sits in quiet deliberation over its peers in a dark, smoke filled room in Warwick. The NAEA could also stand for ‘Not Able to Enforce Appropriately’. And that’s because, bewilderingly, they don’t choose to have the power to compensate consumers for the wrong doing of their estate agent. In effect they are an old boys network of estate agents regulating estate agents in spats between themselves and whose sole qualification needed to ‘oversee’ the industry being length of time that each has been an estate agent. In other words, the more of a dinosaur they are the more qualified they are to ‘regulate’.
Other similar types of business, like financial services for instance, are supervised to an extent that would put the typically over zealous night club doorman to shame. But estate agency is free to do what it likes. And it does.
That’s the reality of the ‘light touch’ regulation that those handling your most prized asset are subjected to. Barely anything at all. Training and education within the industry are almost invisible and exist in the main solely to ‘train’ staff to sell high fees, conveyancing products and mortgage and insurance referrals. Not to inform or to ensure best practice.
However the real culprit of a culture that is so endemically self-serving is the way in which, typically, selling fees are levied. All or nothing. And big, big rewards for firm and individual alike on ‘success only’.
In other words, if they want to get paid, especially if they have particularly lavish earning expectations as many do, then each property negotiator that you come across is bound to put earnings before ethics. Money before truth. ‘Is this house is a decent area?’, you ask. ‘Of course it is. It’s the best area in town’, says Julian, eyeing his next shiny suit in his mind’s eye. ‘Are the local schools any good?’, one might venture. ‘The nearest one is fantastic. In fact the Beckhams looked at sending their kids there’, lies Nigel as he ponders that Rolex, the cost of which is easily covered by just one ill gotten sale.
You get the picture.
Estate agents are ruthless and deceptive because their very financial survival depends on their patter in convincing you to buy anything they can sell you and at any cost. Moral cost included.
With escalating High Street selling fees, now higher than ever and all paid at the end of each transaction based on ‘no sale-no fee’, and sales volumes at a five year low, is it any wonder that the vultures in minis will swoop upon you, the unsuspecting home buyer, as soon as they sense the slightest inclination of your interest in buying their wares. Then like the ‘find the lady’ con men in tourist spots everywhere, they spin you a line, suck you in and take your money.
So the very essence of the remuneration structure that exists in main stream estate agency and that traditional agents will expound as ‘fair’ because of it’s ‘pay nothing unless we sell it’ philosophy, is exactly what makes the process of buying a home akin to wrestling in a nest of vipers.
Estate agents that charge low cost, initial fixed fees are more honest. Why wouldn’t they be without the vested interest of the carrot at the end?