In case you’re unaware there have been new laws introduced to ensure agents don’t purposely underquote the pricing on their listings they have for sale.
In simple terms, what this means is agents are no longer allowed to quote a price range under what the vendor is expecting to accept for their property. Along with the price range they must supply the public with a form that shows 3 recent comparative sales of similar properties to the one they’re selling in the same area to support the price range they are quoting. This is called; “The Statement of Information”.
This has been brought on by agents that continually and purposely low ball the price range under the vendor’s expectation and what they have told the vendor they should achieve for them, to entice many buyers to a property and then use that demand to get buyers excited and force their hand in paying as much as they possibly can for the property. Now you may say “well isn’t that what you are paid to do?” and yes in a way that is correct. The problem in the above scenario is that the agents doing this are misleading the public and creating a false sense of urgency and are leaving behind many a casualty. Buyers are continually disappointed and frustrated by spending their entire weekend looking at homes they thought they could afford but were never in the running.
The new laws are designed to ensure more transparency and less underhanded tactics used by some unscrupulous agents and, in my humble opinion, this is a good thing.
Please note though should, during the sales process, the agent marketing the home receives an offer over and above the range being quoted it doesn’t stop the vendor from accepting that offer. In an extremely competitive market it can shock even some of the most experienced agents the prices being achieved for certain properties. Humans are competitive and some people will go to extreme lengths to ensure they secure the home of their dreams. Another factor in vendors accepting offers is the conditions attached to the offer. The most common two being “subject to finance” and “subject to a satisfactory building and pest inspection”. I personally have had vendors accept a lesser offer on the basis that there are no conditions attached to the offer or the deposit or settlement terms didn’t suit them.
We as agents price a home off historical information and haven’t got the crystal ball to predict what will happen in the future. This job of ours is full of challenges – sometimes they go for more than anticipated and other times they go for less. If we are doing our job right though most times we are right on the money.
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