Staring, staring, lowballing, bidding wars, curbing attractiveness… Buying and selling real estate can seem so complicated it has its own language. And while it was never an easy task, now it seems more labyrinthine and confusing than ever.
A real estate agent’s ultimate goal is to obtain the best selling prices for their clients, and it’s rumored, rightly or wrongly, that many of them use a variety of tricks and tactics to do just that. We asked a cross section of them, working in different fields and at different prices, for the unvarnished, confidential truth about the reality of the Irish property market.
Derek* is a partner working in a large property agency in South Co Dublin.
When we came back post Covid it was really go go go because prices had come down and settled down for a while. That [Ukrainian] The war came and interest rates went up, and I think all that was happening at the same time was enough to send a little shockwave through the market, to say to everyone, “Maybe we need to be a little more sensible here.”
I’ve had situations where buyers have said, “I might have offered you $800,000 for it before, but we changed our mind and are offering you $700,000 for it.” This actually happened when someone came back during the promotion [to renegotiate]. We settled on €790,000 after many different bidders had submitted bids. The proof of financing did not come. We had to return it to the underbidder and they didn’t want to pay €790,000 for it.
We are now at around €720,000 with this property. That’s good news for buyers – such amounts could mean the difference between getting a home or not.
Greed is something I deal with on a daily basis, usually from the sellers. I don’t mind buyers’ greed because they’re just trying to buy for as little as possible.
The only real way to win a bidding war as a buyer is to bid the highest price for the property. Bid in a way that discourages others from bidding against you. €1,000 rise [increments] doesn’t.
Some people wait on the sidelines for everyone else to do the dirty work, and then they end up coming in with an offer. But they never win it for me. I often just say, “No, we won’t take that offer.” Most of the time, it’s a matter of not just taking the better offer, but the one that goes all the way.
An open viewing on a Saturday morning would make you lose the will to live. During Covid at least not too many people came down the driveway to have a snoop. The only question I can’t stand is the person who contacts us to say they love the house but the location just doesn’t suit them. Well I haven’t changed the location since last week when you made the appointment. So many people come to a viewing and ask, “How many bedrooms does this have?” One has to wonder if they even read the ad.
Are Real Estate Agents Placing Fake Bids to Move Things Forward? I would say the answer is yes, although it has been licensed for it since 2012. If my agency catches me doing this, I’m out, regardless of my status in the job, because a good agency won’t let the brand go down like that. However, I would say that bad apples exist and the people who could do it are still out there.
“People in their 20s want that instant gratification”
Sam* is a real estate agent in the Southeast. He has been in the auction business for almost 20 years.
The market is pretty healthy where I am. I see more potential buyers who – and this may sound a bit harsh – could be considered tire kickers. They want to buy but aren’t ready to make any offers yet. They just don’t realize that you need to be up and running in the current market. It doesn’t matter to the seller if your Dalkey flat is worth £3million – if it doesn’t sell it’s of no use to you. That’s how it works.
I think the market is almost static but moving. There are no major new buildings down here. We don’t see that many institutional investors anymore and the individual landlords are definitely getting out [of the market]. Ironically, I see that inflation doesn’t really seem to be affecting home sales. What impacts prices is the maker upper or real estate that needs a little work. There is so much more demand for turnkey properties. Five years ago, 20 people would have bid on the Macher-Upper and five on the ready-to-move-in property. Now we have the opposite.
It’s a generation thing. People in their late 20s want that instant gratification, but they don’t really look beyond the outside. There is value in being in a maker upper when you can find a builder to work with you or when you have the ability to do some of the work yourself. I’m impressed with this late 20’s/early 30’s group; Many of them have stayed at home and are now coming in with sizeable deposits.
A slightly higher percentage of sales fall through in the final stages, although I would always ask for proof of funding. Maybe the trust isn’t as good as it was. If a survey a few years ago indicated that a property needed a few minor things done, they would still proceed with the sale. Now people are not that optimistic or confident.
Are we making false offers? Not at all. I can’t speak for anyone else but we are required to register every offer and we operate under regulation. This is definitely something the public needs to be aware of.
“If this is your first time buying, this little window might be a good time.”
Chris* is an auctioneer in a medium sized agency in Dublin city centre. He has been in the industry for almost two decades.
Right now we’re having a tremendous amount of time explaining to sellers who have been selling homes similar to theirs for a really good price in the last few months that those prices are just not there anymore. Buyer interest is high, but we’re not yet at the peak we were at in July. You can argue that rates will continue to fall due to interest rate hikes and energy prices, but then there’s an argument that even though there’s 30 percent more real estate now than there was last year, there’s still a serious shortage of real estate in the market this time. I can see that prices have fallen 10 percent lately – maybe that will stabilize in the next few months.
What do we think of institutional investors? If you tell me, “There’s a first-time buyer on the one hand and an investment buyer on the other who’s willing to buy at the same price,” most people would happily sell to the first-time buyer. At the end of the day, my job is to get the best price for the owner and make a calculated assessment of who is the safer buyer I can close. Investors have certainly calmed down in their purchases in recent months. You seem to be taking stock at the moment and taking instructions from abroad. You might feel like there could be better value for money in the new year. If this is your first time buying and you’re ready to go, now in this small window could be a good time to buy.
“If you can’t take an hour off to look at a house, you don’t mean it”
Catherine* works in a small real estate agency in the North West.
The big thing here is the lack of supply. Nothing has been built here in the last ten years, so the used market will always be lively. Here Airbnbs would make up 90 percent of the rental market. I had to look for a place to rent a few years ago because I was working on my house and couldn’t find anything for six months. However, Brexit probably had a positive effect on the market here. As the sterling is strong folks [from the North] would have better purchasing power.
Tire kickers are easy to spot. They are the people who only want to view a property on Saturday. If you can’t take an hour off to look at a house, don’t mean it. If people aren’t flexible, they just look at it and aren’t keen on making a serious offer.
People are coming in who don’t have mortgage approval, and they’re also very hard to take seriously. You go to the end of the list. No one will take an offer from you seriously if you’re just window shopping.
To be honest, it’s getting harder and harder to deal with customers. Originally you cared for the buyer across the board – now you care for the seller. There is a degree of gazumping [sellers accepting a higher offer after agreeing in principle to sell to another] in this business, but we really try not to deal with it. We definitely advise against this.
Some sales can fail on older homes, especially those with additions that aren’t clean cut. Everyone falls in love with your typical old cottage in this area – next, a survey report shows all sorts of things behind the walls or the roof. That’s where the real trouble begins.
“Many real estate agents are saying the first six months of 2023 will be flat”
Michael* has been an auctioneer for almost 40 years. He works primarily in South Dublin city center with properties at the top end of the market.
I definitely advise people to dress their house for sale but without overdoing it. Don’t rush the color as people will see right away but it will work to show the property in its best possible condition. Furnished houses are much easier to sell than unfurnished ones. I think a lot of people looking at a house want to see what kind of furniture goes where.
In reality, if you have a BER rating of F or G, you will not reach the top of the market.
I’ve spoken to other agents and many of them say the first six months of 2023 will be flat. In terms of price changes, we expected an increase of 10 or 12 percent [in prices] for the first four months of this year. At the end of June, that figure was about 3.4 percent. I think it could drop to about 2 percent by the end of the year. More and more stocks will enter the market as the market starts to slow down.
“A little bit of power pretty much blows the minds of salespeople”
Phil* is a real estate agent working in the West.
Sellers are getting greedier and greedier. I see it more and more often. I’m dealing with a bunch of housewives who have never sold a house in their lives, and a little bit of power pretty much blows their minds off. They’re determined to say they got 10 grand more for their house than next door. I always have to tell people that there are very good reasons why they should accept a reasonable offer as recommended by their auctioneer.
It’s time to start the program. It’s winter now boys. the sun is gone Buyers will have less purchasing power than they used to, but the penny hasn’t dropped for many sellers.
My heart beats for a young shopper just trying to get a place to live and has his heart pressed to his sleeve. When they come across an investment buyer, they have no hope. They don’t have the know-how that an investor would have. They tell me how much they love the house, while an investor says, “I don’t care where I buy from, I don’t care.”
*Names have been changed to protect anonymity
https://www.independent.ie/business/personal-finance/property-mortgages/estate-agent-confidential-what-they-really-think-of-buyers-sellers-and-where-property-prices-are-heading-42171699.html Real Estate Agents Confidential: What they really think of buyers and sellers and where real estate prices are headed