West Cork Property's Reaction to Prime Time
In addressing the question of what, if any, effect the recent Prime Time documentary report is going to have on West Cork property, it will first of all be a case of waiting to see what develops next.
Joining Senator Shane Ross (in what I would have to admit as an auctioneer are well-founded concerns) were a varied group of people who had experienced the rough end of the stick in their property dealings from auctioneers and builders.
I suppose that I’d have to focus in on an aspect of the report that went unchallenged: One lady who was interviewed complained that “the auctioneer” had agreed a deal for her and took a booking deposit. As a deal had been agreed, the auctioneer didn’t show it to anyone else. One interested party then contacted the owner directly, saw the house and offered more on the property. The woman was not impressed by the fact that the auctioneer had prevented the second client from viewing the house and that it was only because she was fortuitous enough to have been in touch directly with the second client that she herself was able to extract more money for her property. And then, she had to pay the auctioneer fees for what she perceived as a poor service.
So, let’s analyse that for a minute: First of all, once an auctioneer is employed by a property owner, then it’s his duty to get the best price possible on the market for the property. This lady feels that she did that part of the job herself. As far as she’s concerned, the auctioneer got one price for it and she got a better price on her own. But she engaged the auctioneer and she’s paying the fees, so if she wasn’t happy with the price she got from the first client, then she should simply have told her auctioneer so and waited until she got a satisfactory offer. A property is worth what the market is willing to pay for it. So if Client No. 1 offers a certain amount, then in the absence of Client No. 2, that’s what the house is worth. Once she agreed to sell to the first client, then she and the first client had a deal. She instructed the auctioneers to agree it and take a booking deposit. If the auctioneer agreed and took a deposit without her instruction, then they’re clearly not acting in her interest; she pays them and instructs them what to do – it doesn’t work the other way around.
So, the deal was made and Client No. 1 honoured his end of the agreement by putting down a booking deposit. It was she, then, who went back on her word and entertained another interested party after she had led Client No. 1 to believe that he had a deal. In other words, even though she is entitled to do so by law, she acted dishonourably by reneging on her original deal. This raises an interesting point in itself: In other countries, a property deal can be sealed on the day that the deal is struck. In France, for example, or in the USA, when a deal is agreed, then both parties sign a binding contract. Legally speaking, the case in Ireland is that there is no deal at all until such time as the contract is signed by the purchaser and then counter-signed by the vendor. Although this may take several weeks from the time that hands are shaken, the vendor is free to back on his word without fear of any punishment or penalty.
One of the other interesting issues raised in the TV report was that of the auctioneers who are focused on other things outside of the core objective – i.e. achieving the optimum price for the property on behalf of their client. They specifically mentioned the targets-driven marketing groups and auctioneers who doubled as mortgage advisors, some of whom succumbed to the temptation of using private financial information to their own advantage. Legislation is on the way in to change this by not allowing such practise to continue (agents with double agendas). What is interesting about that is that the independent estate agent is already providing the service that many auctioneers will be forced by legislation to provide.
There’s no doubt – in my mind at least – that the independent agent offers a really good service that larger marketing groups simply can’t provide. Anyone tied into a company like this, while providing something that may have some attractive benefits for the vendor, there are very few blessings to be found by the purchaser who arrives in a particular area looking for a property. So, in the West Cork Property scene, independent agents like Harrington Estates area ahead of corrective legislation in that regard.
When it comes to looking for a particular area, many people’s first choice of research tool is the internet browser. Many of the independent agents with their homework done usually come up ahead of the marketing groups here too. This is because their websites are focused on a particular area, rather than having a website that covers the whole of Ireland.
