Can an estate agent mislead you during negotiations?

manitravels · 9 June 2021 at 10:24PM

LAD917 said:

If I'm understanding you correctly, it sounds like you offered X if completion happened outside of the stamp duty holiday window, and X + £5000 if it happened within the stamp duty holiday window? You didn't offer X + the cost of removing the tenants.

We don't seem to know when the tenants' lease was up, or what notice period they had. But given covid eviction laws, it's not unreasonable that the tenants could have stayed in the flat longer, well past the stamp duty holiday, without some kind of incentive. It sounds like the vendor hedged his bets that he could get the tenants out on or before the end of the stamp duty holiday with £5000 (or less).

He may have been able to get them out with less, perhaps 0, but he delivered what he promised - a vacant property by the stamp duty holiday. If the above facts are right, IMO you should pay. With any type of credit / allowance, one party may spend (or save) more or less.

How much are you saving in stamp duty?

About £8k. I offered that because I was told that it would take 3-6 months to take possession. However if that wasn't true then I was lied to.Had the estate agent just said, X is too low. increase by £5k and the seller would accept. That would be fine. It's the lying I'm annoyed about hence asking for evidence.

fiveacre said:

What outcome are you looking for? Seeing evidence of costs isn't going to change what you're paying so it seems a bit pointless. Do you want to proceed at the agreed price, or are you looking to reduce your offer? Are you happy with the current price of the property?

If I've been lied to, I would lodge a formal complaint and reduce my offer accordingly.

verytired11 said:

I don't think you have a complaint because you got exactly what you paid for ie the tenants out. It's true that the landlord had to evict them anyway, and it's also true that they might have done so quickly without the money; but it seems to me you were asked to up the offer and you did. There isn't any paper trail between that and the eviction so it is hard to prove. With the benefit of hindsight you could have said you would pay the costs on receipt of an invoice, but that probably wouldn't have been viable anyway. It might be better just to move on at this point and be glad that your property is vacant and you aren't stressing about whether the tenants will get out in time.

Ok that's fair. It would be hard to prove. Next time I will ensure everything is put in writing.

manitravels · 9 June 2021 at 10:27PM

NameUnavailable said:

Sounds to me like the vendor offered some if not all of your £5K as a cash incentive to the tenants to leave asap.
I don't see why you have any right to demand evidence of how the £5K was spent however, unless you made that a condition of the offer.
Presumably you haven't paid the £5K up front so if you're not happy pull out and buy something else!

Just to clarify my gripe here.
On two separate occasions the EA stated that vacant possession could be given in time for the stamp duty.
During price negotiation I was then informed by the EA that vacant possession may not be possible in time for June. Then an agreement was made.

If the EA, from the beginning said, that vacant possession could be an issue, then I would have no gripe here. Being told one thing, then something else down the line is a little annoying.

Presumably you haven't paid the £5K up front so if you're not happy pull out and buy something else!

I think you're right!

manitravels · 9 June 2021 at 10:30PM

P.S. Thanks for taking the time to respond. It is really good getting a different perspective. Overall I'm happy with what's transpired between myself and the vendor.
It's just the interaction with the EA which has griped me a little.

AdrianC · 9 June 2021 at 10:32PM

manitravels said:

NameUnavailable said:

Sounds to me like the vendor offered some if not all of your £5K as a cash incentive to the tenants to leave asap.
I don't see why you have any right to demand evidence of how the £5K was spent however, unless you made that a condition of the offer.
Presumably you haven't paid the £5K up front so if you're not happy pull out and buy something else!

Just to clarify my gripe here.
On two separate occasions the EA stated that vacant possession could be given in time for the stamp duty.
During price negotiation I was then informed by the EA that vacant possession may not be possible in time for June. Then an agreement was made.

If the EA, from the beginning said, that vacant possession could be an issue, then I would have no gripe here.

Of course vacant possession could have been an issue. If the tenants had really dug their heels in, six months notice would have been required, then potentially two years for it to reach a possession hearing. Then perhaps the notice would have been rejected on a technicality. And, eventually, the bailiffs could have turned up to find the tenants had only just done a runner from the smouldering ruin...

It sounds very much like the EA told you the truth - vacant possession could be given. As, indeed, it is being.
Then perhaps the tenants dug their heels in a bit. But a sweetener persuaded them to play nicely, and they've left.

Everybody's happy...

Oh.

lesalanos · 9 June 2021 at 10:35PM

manitravels said:

NameUnavailable said:

Sounds to me like the vendor offered some if not all of your £5K as a cash incentive to the tenants to leave asap.
I don't see why you have any right to demand evidence of how the £5K was spent however, unless you made that a condition of the offer.
Presumably you haven't paid the £5K up front so if you're not happy pull out and buy something else!

Just to clarify my gripe here.
On two separate occasions the EA stated that vacant possession could be given in time for the stamp duty.
During price negotiation I was then informed by the EA that vacant possession may not be possible in time for June. Then an agreement was made.

If the EA, from the beginning said, that vacant possession could be an issue, then I would have no gripe here. Being told one thing, then something else down the line is a little annoying.

Presumably you haven't paid the £5K up front so if you're not happy pull out and buy something else!
I think you're right!

The EA could not guarantee vacant possession before the stamp duty or at any time in the next 18 months with confidence.

They may have had a 4 week notice in their AST but S21 eviction notices were increased to 6 months during covid and even at the end of the 6 months if the tenants stayed then the courts were closed for legal eviction.
It looks like your £5K has stayed with the seller and he has moved his tenants into another property, maybe he gave them a couple of K for the inconvenience. Either way it motivated the tenants to move and you got your result of vacant possession in plenty of time.

You can normally gauge if an EA isn't being100% truthful as you will see their lips moving

manitravels · 9 June 2021 at 10:47PM

lesalanos said:
The EA could not guarantee vacant possession before the stamp duty or at any time in the next 18 months with confidence.

I'm thinking that this should have been the stance of the EA from the start.

lesalanos said:
"You can normally gauge if an EA isn't being100% truthful as you will see their lips moving "

LOL they are not all bad!

lost_in_the_woods · 9 June 2021 at 11:18PM

manitravels said:

LAD917 said:

If I'm understanding you correctly, it sounds like you offered X if completion happened outside of the stamp duty holiday window, and X + £5000 if it happened within the stamp duty holiday window? You didn't offer X + the cost of removing the tenants.

We don't seem to know when the tenants' lease was up, or what notice period they had. But given covid eviction laws, it's not unreasonable that the tenants could have stayed in the flat longer, well past the stamp duty holiday, without some kind of incentive. It sounds like the vendor hedged his bets that he could get the tenants out on or before the end of the stamp duty holiday with £5000 (or less).

He may have been able to get them out with less, perhaps 0, but he delivered what he promised - a vacant property by the stamp duty holiday. If the above facts are right, IMO you should pay. With any type of credit / allowance, one party may spend (or save) more or less.

How much are you saving in stamp duty?

About £8k. I offered that because I was told that it would take 3-6 months to take possession. However if that wasn't true then I was lied to.Had the estate agent just said, X is too low. increase by £5k and the seller would accept. That would be fine. It's the lying I'm annoyed about hence asking for evidence.

fiveacre said:

What outcome are you looking for? Seeing evidence of costs isn't going to change what you're paying so it seems a bit pointless. Do you want to proceed at the agreed price, or are you looking to reduce your offer? Are you happy with the current price of the property?

If I've been lied to, I would lodge a formal complaint and reduce my offer accordingly.

verytired11 said:

I don't think you have a complaint because you got exactly what you paid for ie the tenants out. It's true that the landlord had to evict them anyway, and it's also true that they might have done so quickly without the money; but it seems to me you were asked to up the offer and you did. There isn't any paper trail between that and the eviction so it is hard to prove. With the benefit of hindsight you could have said you would pay the costs on receipt of an invoice, but that probably wouldn't have been viable anyway. It might be better just to move on at this point and be glad that your property is vacant and you aren't stressing about whether the tenants will get out in time.

Ok that's fair. It would be hard to prove. Next time I will ensure everything is put in writing.

Just to check both of our maths, is the value of the place you're buying about £460k?

If so, £5k is about 1% of the property value, just swallow it and move on. If not, then one of us has messed up their calcs, if it's you then you probably never needed to worry about the stamp duty deadlines.

moneysavinghero · 10 June 2021 at 9:04AM

The EA is a saleperson. Sales people will always tell you what you want to hear. Early on in the process they will have told you it was vacant possession because that's what most people would want to hear or they would walk away. Once you were more interested in the property that let you know a bit more. An extra £5k in price is worth about an extra £50 for the EA in commision, so no real incentive for the EA to have been extra devious in order to push the price up.