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http://www.sfgate.com/cgi-bin/article.cgi?...4/REPRUJ67O.DTL

COULD IT HAPPEN IN THE UK

David Streitfeld, New York Times

Sunday, February 24, 2008

(02-24) 04:00 PST Carlsbad, San Diego County --

Marty Ummel thinks she paid too much for her house. So do millions of other people who bought at the peak of the housing boom.

What makes Ummel different is that she is suing her agent, saying it was all his fault.

Ummel says the agent hid the information that similar homes in the neighborhood were selling for less because he feared she would back out and he would lose his $30,000 commission.

Real estate lawyers and brokers say the case, which goes to trial in North County Superior Court soon, is likely to be the first of many in which regretful or resentful buyers seek redress from the agents who found them a home and arranged its purchase.

"When your house appreciates $100,000 in the first six months, you're not quite as concerned that maybe the valuation was $25,000 or $50,000 off," said Clifford Horner of the law firm Horner & Singer. "But when your house goes down, you ask: 'Who might have led me astray here?' "

Agents representing buyers rarely had the opportunity to make mistakes during the last real estate boom, in the late 1980s, because the job hardly existed then. For decades, residential transactions almost always involved brokers who, whatever assistance they gave the buyer, legally represented only the seller.

The long boom that began in the late 1990s put an end to that one-sided world. As prices spiked, buyer's agents and brokers became popular as sounding boards, advisers and negotiators. The National Association of Realtors estimates they are now involved in two-thirds of all residential purchases.

That makes this the first housing collapse in which large numbers of buyers had a real estate professional explicitly looking after their interests. The Ummel case poses the question: In a relationship built on trust, where promises are rarely written down and where - as in this case - there is no signed contract, what are the exact obligations of these representatives in guiding their clients through a sizzling market?

"Agents have a lot of fiduciary duties, but they don't make money unless they close the sale," said Joel Ruben, a real estate lawyer in Manhattan Beach (Los Angeles County). "In an inflated market, there are built-in temptations to cut corners."

The defendant in the Ummel case is Mike Little, a veteran agent with ReMax Associates. He will argue that Marty Ummel, who brought the case with her husband, Vernon, is trying to shift the blame for the couple's own failures of research and due diligence.

"They simply didn't do what is expected of a knowledgeable, sophisticated buyer, and are now looking for someone other than themselves to take responsibility," Roger Holtsclaw, an agent who was hired by Little as an expert witness, said in a court deposition.

The Ummels may be on the leading edge of the law, but they are unlikely to be alone for long. With the market falling, many homeowners owe more on their mortgages than their houses are worth. And many of those deals involved brokers who are required to carry professional liability insurance, presenting a tempting target for angry buyers.

"If you put someone into a property at the top of the market, you look really bad if it goes down," said K.P. Dean Harper, a real estate lawyer in Walnut Creek.

"There are a lot of letters going out from lawyers to real estate agents saying, 'My client would never have purchased if you had properly evaluated the market conditions and the value of the property.' "

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I'm not sure about sueing EAs but i think that many buyers have been conned by developers and their sales staff on new builds.The prices are initially inflated by about 25% to allow for massive eye catching discounts later ,two year mortgage paid incentive packages ,part exchange deals whereby the developer is forced to offload the px at a loss etc. etc,.Isn't what the house builders do the most wicked deceitful con on would be buyers who are gullible.There are always a few that pay the initial sucker rate.

Edited by crashmonitor

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I'm not sure about sueing EAs but i think that many buyers have been conned by developers and their sales staff on new builds.The prices are initially inflated by about 25% to allow for massive eye catching discounts later ,two year mortgage paid incentive packages ,part exchange deals whereby the developer is forced to offload the px at a loss etc. etc,.Isn't what the house builders do the most wicked deceitful con on would be buyers who are gullible.There are always a few that pay the initial sucker rate.

Caveat emptor.....

DYOR etc.

Frank

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"There are a lot of letters going out from lawyers to real estate agents saying, 'My client would never have purchased if you had properly evaluated the market conditions and the value of the property.' "

Surely they did evaluate the market properly and priced at exactly what the last greedy gullible twit would buy at?

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Good grief, how far do people want the nanny state to go? It's an open market of buyers and sellers - very simple to get price information if you're a buyer - even new builds can be compared to existing properties on a £ per square foot basis. Are people really stupid enough to believe everything a sales person tells them? - especially in the US?

Has it really got to the stage where people now can't even go shopping on their own?

I recommend a film called "Idiocracy": http://www.imdb.com/title/tt0387808/

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Dont they have a slightly different system - it sounds like she hired this guy to go out and find a property and then guide them through the purchase - much like they do on the tv ramp shows here. As such its not unreasonable to assume the agent has a duty of care, which does appear to have been betrayed.

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Good grief, how far do people want the nanny state to go? It's an open market of buyers and sellers - very simple to get price information if you're a buyer - even new builds can be compared to existing properties on a £ per square foot basis. Are people really stupid enough to believe everything a sales person tells them? - especially in the US?

Has it really got to the stage where people now can't even go shopping on their own?

I recommend a film called "Idiocracy": http://www.imdb.com/title/tt0387808/

I disagree some people trust a reputable home builder.If a property type is sold one week to a sucker for £199950 and the next day the same thing gets reduced to £149950 as the property of the week deal......that is f**king fraud.

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A seller can sell for whatever price they choose. They can then reduce it for whatever price they choose the next day.

If a buyer is willing to pay the initial asking price, or any price for that matter, then that is their stupid fault. No crimes have been commited

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I disagree some people trust a reputable home builder.If a property type is sold one week to a sucker for £199950 and the next day the same thing gets reduced to £149950 as the property of the week deal......that is f**king fraud.

Unless there was a blatant lie, it is not fraud. Is it fraud when you go to the supermarket and buy something and find the same item half price in the same supermarket the same day? Is it fraud to buy an item as a Christmas present and find it reduced by 70& in the January sales? Part of growing up is knowing how to shop properly and make proper decisions - including not completely trusting people who are trying to sell you something for their personal gain - prety basic life skill.

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http://www.sfgate.com/cgi-bin/article.cgi?...4/REPRUJ67O.DTL

Agents representing buyers rarely had the opportunity to make mistakes during the last real estate boom, in the late 1980s, because the job hardly existed then. For decades, residential transactions almost always involved brokers who, whatever assistance they gave the buyer, legally represented only the seller.

This is not EA's as we know them. If he is hired by a buyer, the least he is expected to do is to tell a buyer if there have been price drops. While I take responsibility for my own 'shopping', if I paid someone to help me find the cheapest place to buy a designed suit and he intentionally took me to the most expensive place, I would be annoyed.

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http://www.sfgate.com/cgi-bin/article.cgi?...4/REPRUJ67O.DTL

Real estate lawyers and brokers say the case, which goes to trial in North County Superior Court soon, is likely to be the

Agents representing buyers rarely had the opportunity to make mistakes during the last real estate boom, in the late 1980s, because the job hardly existed then. For decades, residential transactions almost always involved brokers who, whatever assistance they gave the buyer, legally represented only the seller.

"Agents have a lot of fiduciary duties, but they don't make money unless they close the sale," said Joel Ruben, a real estate lawyer in Manhattan Beach (Los Angeles County). "In an inflated market, there are built-in temptations to cut corners."

The defendant in the Ummel case is Mike Little, a veteran agent with ReMax Associates. He will argue that Marty Ummel, who brought the case with her husband, Vernon, is trying to shift the blame for the couple's own failures of research and due diligence.

"They simply didn't do what is expected of a knowledgeable, sophisticated buyer, and are now looking for someone other than themselves to take responsibility," Roger Holtsclaw, an agent who was hired by Little as an expert witness, said in a court deposition.

"There are a lot of letters going out from lawyers to real estate agents saying, 'My client would never have purchased if you had properly evaluated the market conditions and the value of the property.' "

If they were paying him then I'd have thought they had a pretty cast-iron case.

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Guest grumpy-old-man
Caveat emptor.....

DYOR etc.

Frank

completely agree Frank.

why oh why do people sign on the dotted line for 25 years at a huge monthly cost for a basic requirement without any economic/financial research.?? :blink::blink:

as for the frenzied btl crew I hope they get everything they deserve. :lol:

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Guest Bart of Darkness
Could this go the way of endowments?

One can imagine the lawyers rubbing their hands with glee if it did.

why oh why do people sign on the dotted line for 25 years at a huge monthly cost for a basic requirement without any economic/financial research

Couldn't agree more. I research all my purchases thoroughly. Usually end up disappointed in some way though, but at least I've not paid too much into the bargain.

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I'm not sure about sueing EAs but i think that many buyers have been conned by developers and their sales staff on new builds.The prices are initially inflated by about 25% to allow for massive eye catching discounts later ,two year mortgage paid incentive packages ,part exchange deals whereby the developer is forced to offload the px at a loss etc. etc,.Isn't what the house builders do the most wicked deceitful con on would be buyers who are gullible.There are always a few that pay the initial sucker rate.

As Frank said, Caveat Emptor.

Buyer beware.

Falling for a sophisticated sales pitch does not mean you've been conned! It means you're feckin' stupid!

The sales person's job is to sell. It only becomes a con or a rip-off if they lie or misrepresent.

Any half intellegent person knows that a salesperson is not their friend - they are trying to sell a product so that they can earn commission. 'Tis the way of the world - get used to it!

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  • 298 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?


      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%



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