Phantom bidding

Parchment

I was wondering how common the practice of "phantom bidding" is? where an estate agent invents a bidder thus raising the price of a house.

I am currently bidding on a house that has taken some 5k jumps in price. I guess thats normal but im just curious. Its a long established Estate Agents in the city i am buying.

billymitchell

Parchment wrote: »

I was wondering how common the practice of "phantom bidding" is? where an estate agent invents a bidder thus raising the price of a house.

I am currently bidding on a house that has taken some 5k jumps in price. I guess thats normal but im just curious. Its a long established Estate Agents in the city i am buying.

Speaking to an estate agent at the weekend, what "could" be happening is that some potential buyer may have put in an offer on the apartment, and also informed the estate agent as to how high they are willing to go. So maybe the estate agent is playing you up as far as the other offers highest bid, just to see how far you will go.

Water John

In the early bids they tend to go up in 5Ks. Once it gets to the 3/4 serious players that will become 2 and 1K bids.
Most EA wouldn't do phantom bids as it would damage their brand. Remember, that's their only asset, goodwill.
Also the difference achieved by puffing would be very little to their commission. Some now ask for bids to be confirmed by email. Don't know how widespread that is, but a very good idea.

Parchment

Water John wrote: »

In the early bids they tend to go up in 5Ks. Once it gets to the 3/4 serious players that will become 2 and 1K bids.
Most EA wouldn't do phantom bids as it would damage their brand. Remember, that's their only asset, goodwill.
Also the difference achieved by puffing would be very little to their commission. Some now ask for bids to be confirmed by email. Don't know how widespread that is, but a very good idea.

This property has jumped in 2k's and then 5k's.its now 3k over the asking price.

I actually asked could i follow up my verbal bid over the phone with an email (i work in an industry where following up with an email is normal practice) but the EA told me not to bother.

I guess i just dont want to be made a fool of in this process! its quite scary as a first time buyer.

Slunk

When we bid on our house it went up slowly, and was taking an age for the others to come back. We were thinking of jumping 5k to scare the other off. In the end we went 3k so I'd say a 5k bid wouldn't be out of the ordinary. We did feel a little like yourselves at some points though. All you can do really is go to your max what your willing to pay and try not think about 'phantom bidders'

Water John

You don't have to copy anyone else. If you want to just always bid up in ones. The guide price now tend to be conservative.
Learn as much as you can about the market in the area to judge your value.
Of course the value to you is what you counts

VincePP

Under new rules all bids must be by a verifiable form - usually text or email.

The fines for not being able to show this are high and action has been taken against agents already.

Another thing to consider is that many sellers wait til spring to put property on the market as gardens look better and its a lot brighter, so whilst not much is available at present (I know as I'm looking for my brother who is returning here soon) there will be a good amount coming on stream, so don't overpay and walk away if price goes above average in the area.

Prices paid for property can be found at propertypriceregister.ie

mirrorwall14

VincePP wrote: »

Under new rules all bids must be by a verifiable form - usually text or email.

The fines for not being able to show this are high and action has been taken against agents already.

Another thing to consider is that many sellers wait til spring to put property on the market as gardens look better and its a lot brighter, so whilst not much is available at present (I know as I'm looking for my brother who is returning here soon) there will be a good amount coming on stream, so don't overpay and walk away if price goes above average in the area.

Prices paid for property can be found at propertypriceregister.ie

What are the new rules?! We'll be hoping to buy I the next 12 months so id love to know

VincePP

mirrorwall14 wrote: »

What are the new rules?! We'll be hoping to buy I the next 12 months so id love to know

Www.psr.ie

Contained both in the contract between the seller and agent and also under regulations im section 61 of 2011 property services regulations act.

If you are concerned you can make a complaint to the psr.

I sold a holiday home recently and the agent was pedantic on getting anything i said about an offer by text or email.

April 73

Absolutely put your bids in an email & ask that any other bids that come in from other people be communicated to you by email too.
This should be standard practice.

newacc2015

Lets assume that the agent is a 1% sales fee agent. Are they really going to risk losing the sale with a phantom bidder for the sake of an extra €75 commission? I highly doubt it. If anything estate agents tend to get sales wrapped up ASAP. They make most of their commission on the large list price. The back and forth with bids to finalise, isnt worth the hassle for most agents.

rom

VincePP wrote: »

Under new rules all bids must be by a verifiable form - usually text or email.

The fines for not being able to show this are high and action has been taken against agents already.

Another thing to consider is that many sellers wait til spring to put property on the market as gardens look better and its a lot brighter, so whilst not much is available at present (I know as I'm looking for my brother who is returning here soon) there will be a good amount coming on stream, so don't overpay and walk away if price goes above average in the area.

Prices paid for property can be found at propertypriceregister.ie

Lots on inaccuracies on that site. There are no fines if your put in incorrect info I am sorry to say.

L1011

newacc2015 wrote: »

Lets assume that the agent is a 1% sales fee agent. Are they really going to risk losing the sale with a phantom bidder for the sake of an extra €75 commission? I highly doubt it. If anything estate agents tend to get sales wrapped up ASAP. They make most of their commission on the large list price. The back and forth with bids to finalise, isnt worth the hassle for most agents.

They do it all the time. Trying to get the asking is very important for 'proving' themselves for starters

Balmed Out

newacc2015 wrote: »

The back and forth with bids to finalise, isnt worth the hassle for most agents.

Its about attracting future business by doing well for clients not the extra little bit in commission.

OU812

When we were bidding on our first house 12 years ago, it got crazy, there were allegedly 3 other bidders & bids were going up by €1,000 daily by all three of us. Eventually I thought enough was enough.

From that point on, I increased the offer by €100 each time & confirmed it. The others still went up by €1,000 & then it jumped by €2,000 & then one of the others went up by €5,000. That out is out of it, but I still added another €100 before one of the others went up another €1,500.

House was originally listed at €200,000, sale agreed at €270,000.

I waited until the last minute then dropped out.

As it happens the sale fell through & he came back to us (& presumably the others) & we were offered second chance. I offered €25k below the original asking price.

Was told it wasn't going to happen at that. I insisted they tell the vendor.

Came back later that evening & was told he'd "let it go at €225k for a quick sale" (no chain).

Told him no & bought a house around the corner for €210k. The original one was taken off the market, then put back on & took another nine months to sell through another EA for €215k. It needed work but there was no way I was going to be the chump in that sale.

It was very obvious what was going on.

April 73

newacc2015 wrote: »

Lets assume that the agent is a 1% sales fee agent. Are they really going to risk losing the sale with a phantom bidder for the sake of an extra €75 commission? I highly doubt it. If anything estate agents tend to get sales wrapped up ASAP. They make most of their commission on the large list price. The back and forth with bids to finalise, isnt worth the hassle for most agents.

I don't think it's the commission that may be behind possible phantom bids. Sometimes a seller refuses to sell until the price reaches an amount they have in their head. This can be a pain for the EA if they can't persuade the seller that it's unrealistic. If the bids get pushed up to the point that the seller is happy with, then the EA can close the sale which is what he/she really wants to do. It's not about an extra €50 commission.

emeldc

OU812 wrote: »

When we were bidding on our first house 12 years ago, it got crazy, there were allegedly 3 other bidders & bids were going up by €1,000 daily by all three of us. Eventually I thought enough was enough.

From that point on, I increased the offer by €100 each time & confirmed it. The others still went up by €1,000 & then it jumped by €2,000 & then one of the others went up by €5,000. That out is out of it, but I still added another €100 before one of the others went up another €1,500.

House was originally listed at €200,000, sale agreed at €270,000.

I waited until the last minute then dropped out.

As it happens the sale fell through & he came back to us (& presumably the others) & we were offered second chance. I offered €25k below the original asking price.

Was told it wasn't going to happen at that. I insisted they tell the vendor.

Came back later that evening & was told he'd "let it go at €225k for a quick sale" (no chain).

Told him no & bought a house around the corner for €210k. The original one was taken off the market, then put back on & took another nine months to sell through another EA for €215k. It needed work but there was no way I was going to be the chump in that sale.

It was very obvious what was going on.

That's the way to do it, in fact the result would probably have been the same had you dropped out of the bidding earlier. My brother was bidding on a house before xmas. It had been on the market for about 6 months. Asking was €160k, and he offered his max available of €150k. In the same breath he told the EA that his bid could not be used as a bench mark to try and squeeze a couple of K from someone else. If the bid wasn't acceptable he would withdraw the offer and look elsewhere. The sale closes later this month!

Terrontress

Don't forget that the EA will pass on bids from bidders without the means or inclination to buy somewhere.


I could bid a friend's place up and have no intention of buying it.

The only way you can protect yourself is decide what you want to pay, don't pay a penny more, and if you pay anything less than that, it's a bonus.

Estate agents are still sharks, in spite of the regulations.

Parchment

OU812 wrote: »

When we were bidding on our first house 12 years ago, it got crazy, there were allegedly 3 other bidders & bids were going up by €1,000 daily by all three of us. Eventually I thought enough was enough.

From that point on, I increased the offer by €100 each time & confirmed it. The others still went up by €1,000 & then it jumped by €2,000 & then one of the others went up by €5,000. That out is out of it, but I still added another €100 before one of the others went up another €1,500.

House was originally listed at €200,000, sale agreed at €270,000.

I waited until the last minute then dropped out.

As it happens the sale fell through & he came back to us (& presumably the others) & we were offered second chance. I offered €25k below the original asking price.

Was told it wasn't going to happen at that. I insisted they tell the vendor.

Came back later that evening & was told he'd "let it go at €225k for a quick sale" (no chain).

Told him no & bought a house around the corner for €210k. The original one was taken off the market, then put back on & took another nine months to sell through another EA for €215k. It needed work but there was no way I was going to be the chump in that sale.

It was very obvious what was going on.

Woah!!! That is shocking. Its such a huge purchase in peoples lives so i find it so sad that the industry isnt more transparent.

Utdfan20titles

Andrew Lloyd Webber had a problem with one squatting in his theatre.

terrydel

newacc2015 wrote: »

Lets assume that the agent is a 1% sales fee agent. Are they really going to risk losing the sale with a phantom bidder for the sake of an extra €75 commission? I highly doubt it. If anything estate agents tend to get sales wrapped up ASAP. They make most of their commission on the large list price. The back and forth with bids to finalise, isnt worth the hassle for most agents.

You'd be amazed at what people will do for money.

Graham

terrydel wrote: »

You'd be amazed at what people will do for money.

Please don't wake the zombies.

As this is a 3 year old thread. Thread closed.