March 30, 2006 in London, Property

Property Sharks

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I’m thinking about purchasing a house in London when my current rental lease expires in May 2007 and so praying to God that by the time this date roles around I will have saved up enough money to purchase in my desired area. More importantly, that I find an honest estate agent amongst all the property sharks out there.

Estate agent ‘lies’ caught on film
By Devika Bhat
TV investigators have exposed potentially illegal sales practices
Debate: should estate agents be regulated?
ESTATE agents have been exposed engaging in unethical and potentially illegal practices, including putting forward false offers to vendors, misleading surveyors and faking signatures on key documents.
Footage in a BBC programme, due to be broadcast tonight, even shows one estate agent supplying an undercover reporter — posing as a potential buyer — with a false British passport in exchange for £750, in order to apply for a mortgage.
The revelations come on the same day that the Office of Fair Trading (OFT) sets up a code of practice for estate agents, aimed at ensuring that buyers and sellers get a fair deal and are less likely to be duped by maverick agencies. The programme, Whistleblower, shows two reporters who worked undercover in estate agents across London over a four-month period.
During the investigation, they are shown to have witnessed unscrupulous activities, including agents lying to surveyors about the value of other properties that had sold in an area, so that buyers would potentially pay more than they should. In another instance, buyers are encouraged by an agency to sign up to a firm of financial advisers, who pass their apparently confidential financial details back to the agency so that they can see how much clients can be pushed to spend on properties.
The agent who is shown providing a fake passport to an undercover reporter, is also filmed supplying other false documents to aid with the mortgage application, a service for which he accepts a separate cash payment.
Employees also describe how sellers can be lured to sign up to an agency with the promise of a high asking price, only to be subsequently encouraged to lower their expectations following false low bids placed by the agents.
Agents are also shown lying to vendors about real bids, initially lowering their value so that the seller is led to believe that they have gained a good deal when the true price of the bid is eventually quoted.
In an illegal practice, an agent is shown acknowledging instances of flyboarding — putting up “For Sale” posters at properties not actually on the agency’s books. Elsewhere, an agent claims he can sell a property to a developer — one of the whistleblowers — at a price much lower than its actual value, in exchange for a personal payment of £10,000.
Anna Adams, one of the reporters involved in the investigation, said: “I found the practices used by some estate agents really shocking. Clients are often paying them thousands of pounds in fees so this brings into question whether agents really are acting in their clients’ best interests.”
An OFT spokeswoman said that unfair and unethical practice within the industry was prominent and well-known. “For many people it is the biggest transaction of their lives and if it goes wrong, it can go horribly wrong. There are plenty of horror stories that we have heard about,” she told The Times.

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