by Peter Mericka B.A., LL.B Real Estate Lawyer and
Qualified Practising Conveyancer
Lawyers Real Estate
So now the REIV is telling consumers that estate agents are “Master Negotiators”. Well, they would say that wouldn’t they. The truth is that estate agents have no idea when it comes to negotiation. And I should know; after all, I have dealt with hundreds of them.
I am one of the most experienced real estate negotiators in the industry, and I can confirm that the genuine negotiations take place without the estate agent. Why? Because the estate agent doesn’t represent anyone but the estate agent.
True negotiations take place between the parties themselves, or through their lawyers. And these negotiations often take place AFTER the estate agent has secured the signatures of the parties!
The fact is that the average estate agent is incapable of negotiating a real estate deal. Why? There are three fundamental reasons:
- The estate agent never represents the full interests of the client
- The estate agent acts for both parties to the negotiation
- The estate agent is incapable of drafting the negotiated agreement
The incapacity of estate agents to conduct a genuine negotiation is one of the reasons why estate agents keep the parties well separated.
Can anyone imagine, for example, an estate agent sitting at a table with his or her client, negotiating with another “Master Negotiator” who is seated opposite with the purchaser? It simply doesn’t happen.
Let’s look a little closer at the 3 incapacities of the estate agent as negotiator.