Purchasing property in today’s market can be very stressful. You may think that purchasing from a private sale may be easier but there are risks involved.
Whilst it is important to remember that the agent acts for the Vendor there are some advantages for the Purchaser when an agent is involved, as opposed to a private sale. Some of the advantages are outlined below.
Real estate agents know the market conditions and prices so Purchasers are less likely to be taken advantage of. They also have a legal obligation to treat the buyer fairly including not withholding or giving inaccurate information about a property. For example, under the Fair Trading Act an agent cannot make an unsubstantiated representation about a property.
Another benefit for Purchasers is the ability to make enquiries about the property free of charge and can rely on the agent’s advice. An agent can be held accountable if they make any false or unsubstantiated claims about a property.
The agent should not mislead the Purchaser about the seller’s pricing expectations. Often when there is no agent and the Purchaser requires finance to complete the purchase, a bank will require a valuation report which is an extra cost to the Purchaser. This extra cost may be avoided if an agent is involved.
A deposit (normally 10%) is required to be paid to the Vendor or the real estate agent when entering into an Agreement. If an agent is involved they will hold the deposit as stakeholder and are required to refund it to the Purchaser should the Agreement not proceed for some reason such as cancellation for non-satisfaction of a condition. A private Vendor may not be aware of the legal requirements regarding the holding of the deposit.
An agent is required to provide the Purchaser with written guidelines about the sale and purchase of property. These guidelines set out key information you should consider when purchasing.It is important to remember that an Agreement for Sale & Purchase is a binding contract and it is highly recommended that you obtain legal advice before signing so that your interests are protected