Dodgy Dealing From Ea?

[Portent]

I really can't wait to see some of these guys go to the wall.

There was a house for sale which I liked the look of. I don't want to say where because I suppose it's possible it may come back on the market (although I think that's unlikely now). It is owned by a charity who are selling it through this EA. Although it needs a lot of work it is priced at £100k less than two of it's neighbours. Allowing for the work needed it's probably £40k to £50k cheaper than it "should" be marketed at.

At such a good price I thought it was worth seeing with a serious intention of puttin in an offer if I liked it. I made an appointment to see it as soon as I saw it come on the market. I was due to see it this weekend.

Today I received a call from the EA saying that it had been taken off the market as the charity had accepted a full asking price offer made directly to them and not through the EA. I asked if I could see the property anyway, just in case the sale fell through later. But the EA said the offer was accepted so they could not do that (usually an EA tends to let anyone view in case they want to raise the offer). I was a bit suspicious so I tracked down the charity name and address of the owner through the Land Registry. Then I started calling various numbers found on the net until I was put through to the department selling it.

The story from the seller was completely different. The sale was to a buyer introduced through the EA and while he would not tell me the price, I had a strong feeling from his tone that it was not for the full asking price (although I can't prove that of course). Unfortunately all he would say was that he'd bear me in mind if the sale fell through (didn't expect anything more to be honest). But this whole thing just seems so obviously dodgy to me:

1) The house is priced much lower than it's neighbours.

2) My appointment was cancelled and unusually I was not allowed to view.

3) The EA said the charity had taken a full asking price offer directly and not through them. This is clearly not true.

Re-arrange the following words:

Friend Agent of Estate Bought has it

One useful side effect of this of course, is that the price will appear on nethouseprices as much, much, lower than it's neighbours. So it will probably force down other prices in the future.

[2005]

I would have expressed these concerns to the charity. If they are dealing with this from an office somewhere else it is unlikely that they know two similar properties are up for sale at much higher prices.

It sounds to me like they are being ripped off and the EA's have just sunk to an all time low.

Seriously - I would let tham know what you are thinking - even if it is only to fullfill your good deed for the day...it's a chairty after all.

[Pablo-silver or lead?]

The EA has a legal responsibility to obtain the best price for the vendor, in this case a charity.

The EA has a legal responsibility under law to forward all offers to the vendor.

Explain this to the vendor.

Tell the EA you have tracked down the vendor and spoken to them direct. Tell The EA that as the 'Effective intoduction' of the property to you was through them (the EA) you have no intention of cutting them out of the loop.

Hand the EA your written offer for the property (subject to survey or any other conditions you wish to impose) and tell them they have a legal responsibility to forward it to the vendor. Also say you will check with the vendor that this has been done.

If they have done anything dodgy, they will s**t themselves. Why make it easy for these people.

Pablo Silver or Lead?

[Portent]

Unfortunately I can't get to see inside the property and hence I don't yet want to put a bid in "blind". There's a couple of photo's but that's all I've seen. Also having discussed it with the charity themselves, it is clear that they want to let the existing sale play out before even considering me.

Edited January 21, 2006 by Portent

[Elizabeth]

As a charity they have a responsibility to get the best price they can to contribute towards the objectives of the charity. You could always move fast to put in an offer at the asking price in writing to their board of trustees (probably through the Chair), outlining what has happened. Then it would have to be considered. Somebody might feel honour bound to complete the sale, but they are not. Their first responsibility is towards the objectives of the trust. Particularly if they are being blocked from other information that may influence their decision. The board of trustees would probably have to agree the sale and they would have to justify themselves to the Charity Commission if they didn't do their best. What stage do you think the sale is at? If you really want the property, get past the administrators and move it up the chain fast.

[Portent]

Good sound advice there, thanks.

[2005]

Unfortunately I can't get to see inside the property and hence I don't yet want to put a bid in "blind". There's a couple of photo's but that's all I've seen. Also having discussed it with the charity themselves, it is clear that they want to let the existing sale play out before even considering me.

Put in a condtional bid subject to viewing. You can always change the bid or pull out altogether but the EA will have to pass the bid on.

They can not let the existing sale play out. As Elizabeth said they have a duty to the charity - this is not a private sale. They have to be seen to be obtaining the best price. In fact I think their actions so far - even without your bid - fall short of their obligations to the charity.

[OnlyMe]

Portent,

Had the same with a potenital house purchase a few years ago, foreign located owner (so well out of the loop) got a phonecall on the day of the viewing to cancel, it had only just come on the market.

In no way could it be said that the agents were obtaining best price.

[Portent]

Portent,

Had the same with a potenital house purchase a few years ago, foreign located owner (so well out of the loop) got a phonecall on the day of the viewing to cancel, it had only just come on the market.

In no way could it be said that the agents were obtaining best price.

Yep this is almost exactly what's happened.

[OnlyMe]

Yep this is almost exactly what's happened.

If you really want to go for it, it is that good a deal and you want to have a chance of getting it I'd be tempted to avoid the agents totally.

Put a bid in direct to the charity, asking price or just over if you like together with a note than the only condition is a viewing with a builder friend after which you will instruct a surveyor - charity to provide access to the property on a date at their convenience within say 2 weeks. Tell the Charity that you have no faith in the agents and that you wil not deal through them.

In retrospect I wish I'd traced the owner and done that myself in the above instance, just to see what would have happened.

[Pablo-silver or lead?]

It is as mentioned, worth (as diplomatically as you can) pointing out to the board that they should do everything reasonably possible to obtain the best price for the charity, or lest be in breach of their fiduciary responsibilities and could therefore be exposing themselves to personal liability. That always tends to focus the minds a bit.

I would not recommend you cut out the agent, as they would pursue the vendor for their fee if you did a private deal. You having found out about the property through them ? = (effective introduction).

Pablo Silver or Lead?

[OnlyMe]

I would not recommend you cut out the agent, as they would pursue the vendor for their fee if you did a private deal. You having found out about the property through them ? = (effective introduction).

OK, fine, if you go through the agent they will want the fee anyway, tell the vendor that if the agent comes running for the fee that you will pay it.

The risk of putting the offer to the agent is that it still doesn't get passed on. You could of course put the offer to the agent and also put the offer to the vendor directly as well to get round that problem.

As it is the agent's story doesn't match up with the vendor's so I think the agent is already on a sticky wicket.

[Elizabeth]

It is as mentioned, worth (as diplomatically as you can) pointing out to the board that they should do everything reasonably possible to obtain the best price for the charity, or lest be in breach of their fiduciary responsibilities and could therefore be exposing themselves to personal liability. That always tends to focus the minds a bit.

I would not recommend you cut out the agent, as they would pursue the vendor for their fee if you did a private deal. You having found out about the property through them ? = (effective introduction).

Pablo Silver or Lead?

Arguably the EA are already in breach of contract and also in breach of the code of ethics (?!!!) by operating in this underhanded way. So they could go the the Charity, but the Charity could go them double time. It may focus the mind if they think it will affect the wallet, if they think they can get away with it who cares (I mean, what is anyone going to do? - report them? to whom?)