Tough times are no excuse for tough behaviour

These are tough times in the residential property world.

There are more buyers than there are properties for sale, putting some estate agents on a starvation diet of new instructions.

This is leading some of them, often as not big names as small local concerns, to capitalise on any business they do win by using what I consider dubious means. It’s not just me who thinks so, either, as the Code of Conduct imposed on member agents by The Property Ombudsman takes the same view.

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I’m referring to the practice of not accepting an offer after a viewing, end even implying that the hoped-for purchase will be lost entirely, unless the potential buyer speaks to the agent’s preferred, often in-house with big names, mortgage adviser while simultaneously using the agent’s in-house conveyancing organisation rather than the client’s own local solicitor.

Quite apart from being sharp practice, such actions breach Rule 18a of the TPO Code of Conduct for sales agents. Failing to pass on an offer to the vendor is also illegal – agents must pass on offers whether or not they think they are good enough. Ultimately, it is the vendor who decides whether to accept an offer but the agent can influence that decision during a private discussion to which the potential buyer is not privy.

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Some agents argue that by insisting someone making an offer sees their in-house mortgage adviser they can ensure the person is financially fit to back up their offer by completing the transaction. That may be true – the bad practice comes in refusing to accept the offer unless the mortgage adviser is used exclusively.

Sometimes a vendor or buyer will ask for some suggestions as to which solicitor or conveyancer they might use when they haven’t needed to avail themselves of legal advice for a long while. I will be open and say that I have referred people to law firms who pay me a fee for doing so. But, and it’s a big but, when this happens I am obliged to disclose the fee payment.

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If an estate agent tries to deny you access to a purchase if you don’t use their in-house or preferred services then you have a remedy in your hands. You know where the property is because you have been there so drop a note through the door that the owner will find to explain your interest and that the agent is blocking you.

Another practice that has been highlighted recently is where the estate agent charges a reservation fee to the buyer before they will pass on an offer to cover their own costs should the purchase fail. Sadly, there are some circumstances where the TPO now allows this but it leaves a bitter taste. Anyone who can’t survive in a competitive business world without indulging in what most of us regard as poor practice should maybe consider changing jobs. Better to do it sooner rather than wait for the desperate survival tactics to fail, too.<