EA scam? Or am I paranoid?

pixwix

My wife's father died last year, leaving her his maisonette flat. We don't need it so she decided to sell.

It's now been on the market for 6 months - asking price (on EA's advice) of £70,000 in an area where 3 other identical flats are for sale via other EAs at around £80,000.

The EA phoned my wife this morning advising a drop in asking price to £60,000 - she reluctantly dropped it to £65,000.

Now I know the housing market is slow right now, and I know that properties like anything else are worth what you can get for them irrespective of asking price. But I'm hugely suspicious that the wool is being pulled over my wife's eyes here. I have heard tales of EAs back-pedalling on a sale, so that an 'associate' can step in and buy when the price has dropped.

Either that or the other EAs in the area don't know their business.

Any advice?

What would be involved in changing EAs?

nick_

i think it'll be quite hard for people to comment when they don't know:

(a) the state of your father in laws property. is it dated? does it need any work doing to it? is it structually ok?

(b) the area itself. just because there are two other properties in the area (are they identical to yours?) priced at £80,000 doesn't mean that's what they're worth. why not check previous sale values of similar properties in the area - loads of websites offer a free service for this kind of thing.

(c) following on from the above, how long have the other properties been listed for? if its a while then i think you are able to draw your own conclusions.

(d) how many viewings have you had? what were the prospective buyers feedback? It could be price, state of repair, it could even be a lack of proactive activity from the EA. Why not ask the EA how they're marketing the property.

Why not get a second/third/fourth independent EA to value the property? You are under no obligation to do anything but if it gives you peace of mind then it's worthwhile. Explain the situation to them and see what they say.

In defence of all the good EA's out there, just because something is not to your liking (ie the price) doesn't mean they're trying to pull a fast one. as i explain above you are free to get it valued by an alternative EA.

MacMickster

Have any of the £80K flats sold? If so then you will need to check what price they eventually sold for, but if not then it seems that your wife's EA knows the local market better than the others.

Unfortunately many EAs deliberately overvalue properties initially to drum up business as sellers are more likely to go with the EA who says that they can achieve the extra £10K on the sale price. The property will eventually sell for the same price that it would with the EA who valued it lower (but it will probably take longer to before the seller reduces the price to a more realistic level) but by overvaluing it in the first place the EA has gained the sellers business and so gets the fee for selling it. When an EA is doing this in an area it makes life difficult for others who are trying to give a realistic valuation.

If you have concerns that your wife's EA is deliberately failing to market the property properly in order to drive the price down, then the best way to check this is to ask a friend to call in claiming to be new to the area, and asking for details of properties which would match your wife's (without mentioning that property specifically). If they give him details of your wife's property and talk positively about it then you will know that they aren't doing anything underhand.

shirleyheights

did you get other valuations? a minimum of 3 is advisable as well as your own research.

StuC75

As per other comments, what price are they selling at,, if the EA has some one 'wating in the wings' then I would say to get them in then! Not forgetting House only worth what buyer willing to pay and seller willing to accept. Putting the price down could get more interest..

Whats the rental potential - as investor types would be swayed by what there potential returns are and making sure the %'s add up for a good return.

GDB2222

Just do as nick_ said.

pixwix

nick_ wrote: »

i think it'll be quite hard for people to comment when they don't know:
(a) the state of your father in laws property. is it dated? does it need any work doing to it? is it structually ok?
(b) the area itself. just because there are two other properties in the area (are they identical to yours?) priced at £80,000 doesn't mean that's what they're worth. why not check previous sale values of similar properties in the area - loads of websites offer a free service for this kind of thing.
(c) following on from the above, how long have the other properties been listed for? if its a while then i think you are able to draw your own conclusions.
(d) how many viewings have you had? what were the prospective buyers feedback? It could be price, state of repair, it could even be a lack of proactive activity from the EA. Why not ask the EA how they're marketing the property.
Why not get a second/third/fourth independent EA to value the property? You are under no obligation to do anything but if it gives you peace of mind then it's worthwhile. Explain the situation to them and see what they say.
In defence of all the good EA's out there, just because something is not to your liking (ie the price) doesn't mean they're trying to pull a fast one. as i explain above you are free to get it valued by an alternative EA.

Thanks Nick - and everyone else. Given me something to think about. But especially thanks to Nick for pointing out stuff I should have appreciated was obvious.

(a) State of the property? Above average. Excellent state of repair and decoration, full c/heating, insulation and d/glazing. Even has a porch which the others don't.

(b) 3 other properties on the same estate courtesy of the same builder (mid 80s I think), identical other than the added porch. I haven't found any recent sales (last one seems to be around 2010) but I'll keep trying. I do appreciate the lack of sales might be very significant.

(c) Other properties have only been listed a month or two. Obviously I'm now keeping a close eye on the outcome(s).

(d) Number of viewings - now there's the rub. According to the EA only one person has shown an interest in 6 months, and they withdrew. Even in a depressed market I find that remarkable when the property is so markedly cheaper than other offerings.

I had suggested to my wife that we get alternate opinions from other EAs - and that's when things got tricky. The EA got quite stern, pointing out we have a 'contract' which he'll enforce if necessary. Which in itself made me immediately wary. That was why I asked about the legalities and costs of approaching other EAs - sorry if I didn't make that clearer.

If I'm not aware of the finer points of selling property, I'm at least aware of financial reality. My only other experience is 40 years ago, buying the house I live in - a process in which I was royally screwed over by solicitor, surveyor and EA - some of which ended in court. Which might explain my cynical attitude. I know full well that an asking price isn't a sale price by any means, whether it's a house or a gadget on eBay. But - three other EAs expecting more?

This might of course be affected in the long run by how well those other properties sell. In the meantime I'd have thought that a 10 grand initial mark-down on my wife's property might have attracted more attention - and a request for a 20 grand discount still has me in a suspicious frame of mind.

But then - as I said - I may just be paranoid. Though just because you're paranoid doesn't mean someone doesn't have it in for you. )

GDB2222

How much did the 2010 one go for?

zappahey

pixwix wrote: »

(d) Number of viewings - now there's the rub. According to the EA only one person has shown an interest in 6 months, and they withdrew. Even in a depressed market I find that remarkable when the property is so markedly cheaper than other offerings.

If you have had no viewings then the price is too high. It's that simple.

It doesn't matter that it's cheaper than the others, it just means that they're far too high.

terrierlady

how long have you signed the contract with e agent for, here its between 6-12 weeks .

Ivana_Tinkle

At the risk of stating the obvious, you need to read your contract. It's v v unlikely you're still tied in to your agent after 6 months, but you need to check the notice period.

To be honest, your EA's blustering would annoy me so much I'd be inclined to dump him anyway. How is he going to "enforce" the contract? He's only managed one viewing, which went nowhere, in 6 months! He can't possibly claim he's introduced a buyer, and therefore you owe him nothing.

Do bear in mind that any other agent you approach is likely to tell you that your price is completely reasonable and they've got loads of buyers who'd love to snap up the house, just to get you to sign. You need to be a bit cynical and poker-faced with them.

What was the price of the property that sold in 2010? Do you think prices in your area have changed radically since then?