ITV news has reported that the Property Ombudsman has warned about a growing number of estate agents who are charging buyers as well as sellers.
Consumer Editor Chris Choi wrote:
Our research shows it's happening all over the country, involving hundreds of agents. The practice means that purchasers, who are already over-stretched, face more expense.
Christopher Hamer, the Property Ombudsman, is shown on video showing the potential pitfalls of the 'introduction fee'.
The Government has told ITV News it is "concerned" about the "emerging practice" of double charging by estate agents.
A Department for Business, Innovation and Skills spokesperson said:
The Consumer Minister is aware of the emerging practice of double charging by estate agents and is concerned about its potential impact on the market.
Jenny Willott met with Christopher Hamer, chief executive of The Property Ombudsman, and Lewis Shand, chief executive of Ombudsman Services: Property, earlier this week to discuss the issue.
Both schemes have committed to closely monitoring complaints relating to double charging.
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Comments
This is pushed very hard in my area by Arun estates and its due to a there fees being so much higher than other agents, they don't want this to drop and therefore feel more suited to charging anyone who will pay it.
The entertaining comments from buyers such as I would have paid more but I was being charged 3 grand is all too common plus the fact most of the vendors ive spoken to are unaware the buyer is paying the fee!!!! also not aware of the fact potential buyers might not have a further few thousand in order to buy there home, how many first time buyers have thousands extra on top of there deposit....Its a short term fix... as now there USP (professional photography) is being replicated by other agents.
@John Millichap, or whoever you are, (yesterday):
If you look, carefully, you will see there are numerous shortcomings within the operation of the UK's housing market.
My proposed revision deals with buying and selling rather than renting.
Among the shortcomings in this speck area are conflicts of interest where agents end up taking instructions both from the vendor and the purchaser of a specific property.
I have witnessed this happening at first hand. There needs to be a revision of the systems in use.
I have proposed one such revision, having spend a lot of years working in the industry.
You are, of course, open to propose one of your own, if you wish to.
Please read mine carefully and consider it because I think it has merit.
Peter Hendry says that agents should work exclusively for buyer or seller/ landlord or tenant. Would he also agree that each party should also rely solely upon their own representative's advice and not expect the other party's agent to owe them any duty of care
Why should - even how can - the seller's agent, in doing his utmost for his client, have any responsibility towards the purchaser Let the purchaser obtain his own advice. This whole premise is founded upon everyone wanting everything for nothing and being encouraged to expect it. It started with the building society valuation being used as a tool by purchasers to make spurious claims against valuers years after the event when the valuation was commissioned purely for the society to know whether they could lend money using the building as collateral. It was to protect the shareholders of the society not the purchaser. That is the sort of muddled thinking that engenders bad business and poor outcomes - except for the lawyers when it all hits the fan.
ITV says purchasers are hard pressed financially already. Nobody said it was going to be cheap to buy a house. Why should estate agents reduce their income just to satisfy other peoples' requirements. If the government wants to take it all away from agents then why don't they act for all vendors compulsorily. See how they get on!
Auctioneers have been charging both ends, buyer and seller for many years, thirty or so. Parliament has not seen fit to call this wrong or immoral. You cannot work for two masters and do right for both of them. There HAS to be a conflict of interest or you would be failing one or the other.
The case of charging fees to a prospective tenant however is very different as these are monies paid for a service, not a skill that creates a benefit. It is a sad reflection on the intelligence of those raising objection to this, especially those who purport to have the skills to govern us that they cannot understand this fact.
It is high time that those institutions that represent the industry, RICS and NAEA and others banded together and actually fought the corner of the agents in matters of this type instead of sitting in their excessively expensive offices and pontificating about how much more agents should do for tenants and purchasers- people who do not pay them.
Double charging is obviously a conflict of interest, but I do not think that charging a tenant to prove that they are worthy is anything other than fair (as long as the charges are clear, honest and advertised up front).
I find the Arun Estates "What If You Could Sell Your Home for 150+VAT *******" offer fascinating.
They have actually found a way to DESTROY their future business - every single potential buyer that I have met has said exactly the same thing "We will NOT be dealing with those shysters" which is amazing good news for the rest of us.
Owners need to realise that if you sign up for this kind of deal, then the client is the buyer and it is then the agent's responsibility to look after the buyer, not the owner - "Of course I will get you a 10,000 price reduction sir".
When the market settles down a bit, all this fuss will vanish.
@Elizabeth Freeman
Well no, actually. You'd have to read the solution itself, carefully, to get to fully understand how it would work.
Anyway, I thought you said you weren't commenting on this site anymore PeeBee ;)
You said you'd gone over to the other side, so it's time to make up your mind!
Peter, wouldn't some agents just "find" their client another property they were marketing.
Portals have removed the need to employ someone to find your next property.
This problem has clearly existed over many years but it is now re-surfacing owing to the present difficult market conditions.
The indications from this are that change, in the way houses are marketed, is overdue but instead of simply trying to ban agents from working for both buyers and sellers, I've come up with a solution that doesn't require any such ban.
It proposes that estate agents should work primarily for buyers but also deal with selling the houses which they (their clients) want to move out of.
For more information about this new proposal, please see the full article published on:
http://www.property-match.co.uk/blog/2013/12/05/estate-agents/want-functional-stable-housing-market/
Arun Estates
Auctioneers and letting agents have double charged for years. I always thought the client was they that paid the agent, so who is the client when double charging Conflict of interest
What a good idea.