Agent taking higher offer to seller after mine was accepted

[Ranjanx]

Hi All

 

Here's the background -

The Agent called up last week to tell me that they had three prospective buyers in the fray, including me and we all had similar offers on the property. The Agent wanted to avoid a bidding war situation and therefore I had time till 3:00pm same day to make my best and final offer. They will submit all offers to the seller and let him decide. 

 

I adjusted my offer and was told the next day that it had been accepted. The conversation moved on to identification documents, mortgage etc. 

 

Yesterday (a week later) I got a call from the agent to inform me that one of the prospective buyers had made a higher offer and they were legally required to take it to teh seller to let him make the decision. 

While I didn't like the overall approach etc and I have had an argument with the branch manager, Here's my question for the forum -

 

Is there legally such a requirement for the agent to take every offer to the seller even after it has been agreed ?

 

The second part is ignoring the legal aspect but more on ethical and practical grounds - Since my expectation was set for the offer to be best, final and accepted, what else could both of us - Agent and me - done to avoid such a situation? Or would this always be the case ?

I understand the transaction is nowhere binding until its actually completed but I don't see it as one of the seller or buyer pulling out but to me its the case of the agent going back on their word and chasing the highest paying bidder. 

 

 

Thanks in advance. 

 

 

[Robert]

Hi Ranjax.

 

In a word- Yes.

 

The agent has a legal and a moral obligation to report every offer to the vendor- even silly low ones which would never be accepted. This will continue until you exchange contracts.They are acting for the seller remember, not you.

 

The agent will obviously make their recommendations to the vendor on which offer to take,

 

Often the best offer isn't  the highest price, but the one who can move quickest. A cash buyer with evidence of funds, solicitor in place, and a history of completing quickly will trump an extra grand or so on the asking price.

 

Ive found in the past that i have to 'coach' the agent when putting an offer in. They are likely to just ring up and give the offered price, which in my opinion is crap.

 

I usually start by telling the agent that my offer is cash, or that i have a mortgage agreement in principle, and show them proof. I then tell them the problems I've found with the property, with expected costs to rectify, and compare that to sold prices for similar properties in the area. Only then do i give them a figure, and i ask them to repeat the information to the vendor in the same way, while I'm sat in front of them. Sometimes they do, sometimes not!

 

Or you could avoid all this hassle and buy at auction. 

 

Rob

[Robert]

I've just noticed that ties in nicely with this weeks podcast!

[Ranjanx]

Thanks a lot for the detailed response Robert. Thats really useful. Whichever way this oarticular property goes, i'll keep that in mind for future transactions.

Thanka again.