Fake bids on a house....possible?

ClubDead

I'm in the middle of a bidding war for a house at the moment and it occurred to me, what’s to stop the agents from making up fake bids. Or the house seller getting people to bid to push up the price. I know, this is totally tinfoil hat wearing territory but could it happen? Do you think it does happen? Is it possible to question the legitimacy of the other bidder?

NOTE: I know I sound nutty...But we've been looking at property for over a year and I do think its making me crazy :pac:

seamus

Agents are required to keep a register of bids; who made them and when.

But of course this information isn't public and can only be discovered if there's an audit or compalint.

So in terms of whether it can happen, yes. And it does. Though not as much as it used to. Used to be standard practice in the past.

Graham

Possible, yes. Likely, no.

There is huge demand for property and limited supply. Even if there were 1 or 2 agents willing to risk their career with false bids, there's no need. Plenty of real bidders like you who have been looking for something for months.

ClubDead

Thanks for not laughing at me guys....I think this process makes ya a bit paranoid and crazy.

Graham

ClubDead wrote: »

Thanks for not laughing at me guys....I think this process makes ya a bit paranoid and crazy.

Pretty much everybody goes through the same thought process when buying in the current market.

There's a good chance those telling you it's incredibly unlikely to happen had exactly the same thoughts when they were in the market

Cuddlesworth

What would be the motivation?

Like others have said, its a sellers market if the house is priced right.
Estate agents make around 1-1.5% of the sale price.

If the bid goes up by 10k, they get another 100-150 Euros. If you took the time into account of taking bids, keeping track, informing the seller, how much of that money do they actually get? Is it worth the risk or getting caught?

Estate agents want a handful of viewings, a bunch of bids and a quick sale. They don't care about small increments in price.

Lumen

It's possible that the seller is getting friends to bid, but TBH even apparently genuine bidders may pull out and leaving you holding something you've "overpaid" for, and in any case you should try to focus on what you think it's worth rather than judging the value by the actions of others.

In order to buy a house you need to pay more than anyone else thinks it is worth. Don't think about that too much. :pac:

beaufoy

A few years ago I bid full asking price on an apartment 60000 the agent said my bid had been beaten by another bid. I pointed out that the property had been on the market for 6 months without any interest then when I show interest other interested parties suddenly appear. Anyway I increased on the alleged bid which had beaten my bid, and a few days later the agent told me my new bid had been beaten by the other bidder. I told the agent that I believed he was lying about the other bidder, and I refused to increase my bid saying "sell it to the other guy if he exists"....Two months later the property was still for sale

Wabbit Ears

Im a bit surprised people think its not common or have lessened. Friend of mine also just bid on a house that hadnt been bid on in months, suddenly a counterbid magically appears. No subtlty, simply, oh! a bid, lets chance our arm and see if they'll up it.

Its rife and as far as Im concerned absoulutly standard practice still. Until there is a very public case of an estate agent being held to account for it itll contiunue to be so.

DrPhilG

Just to balance it a little...

I suspected 6 years ago that the I was being pushed up by a shill bidder.  Asking price was €135k, I started at €120k.  Got increased by another bidder until I reached full asking, then they stopped and I got the house.  I always suspected that there was foul play involved.

Until a few years later when my wife was getting a taxi home and the taxi driver told her that he had nearly bought our house, was bidding against one other party but pulled out just before the asking price and missed out.

Cuddlesworth

Wabbit Ears wrote: »

Im a bit surprised people think its not common or have lessened. Friend of mine also just bid on a house that hadnt been bid on in months, suddenly a counterbid magically appears. No subtlty, simply, oh! a bid, lets chance our arm and see if they'll up it.

Its rife and as far as Im concerned absoulutly standard practice still. Until there is a very public case of an estate agent being held to account for it itll contiunue to be so.

That probably was a fake bid, or it was somebody who had offered significantly less(which was refused) and had asked to be notified if there were any other bids.

But if the estate agent had came back to you and said, the owner is only going to ever accept x, what would you say? Because even if it was a fake bid, that's why the estate agent would do it. The owner has a figure in mind and he is trying to get the sale up to that, or it will never sell.

A work colleague is house hunting in the west and if he is interested, he puts a bid in. If they come back with anther magical bid he tells them to cut the ****, to tell him the sellers actual price and if there is wiggle room there. If its unrealistic he moves on. If they keep the charade up, he leaves the bid there and moves on. And 6 months later, he is starting to get reply's to bids.

Wabbit Ears

Cuddlesworth wrote: »

That probably was a fake bid, or it was somebody who had offered significantly less(which was refused) and had asked to be notified if there were any other bids.

But if the estate agent had came back to you and said, the owner is only going to ever accept x, what would you say? Because even if it was a fake bid, that's why the estate agent would do it. The owner has a figure in mind and he is trying to get the sale up to that, or it will never sell.

A work colleague is house hunting in the west and if he is interested, he puts a bid in. If they come back with anther magical bid he tells them to cut the ****, to tell him the sellers actual price and if there is wiggle room there. If its unrealistic he moves on. If they keep the charade up, he leaves the bid there and moves on. And 6 months later, he is starting to get reply's to bids.

good job him calling them out on it but still it just shows how commonplace the practice is.

Cuddlesworth

Wabbit Ears wrote: »

good job him calling them out on it but still it just shows how commonplace the practice is.

I think it does happen but its not as common as people think it is.

I think a part of the problem is that Irish people have little to no haggling abilitys.

adocholiday

We thought we were in this situation. We had the only bid on a property that was on the market for a long time and as we were about to close the deal suddenly a new bidder appeared. We were certain that it was fake, simply trying to force our hand into a higher offer. We said we'd call the bluff and didn't counter offer. A few weeks of radio silence later then we noticed that the house was sale agreed and we were out! Now we're back house hunting and it's been very unsuccessful so far in a rising market. Big mistake on our part.

ClubDead

adocholiday wrote: »

We thought we were in this situation. We had the only bid on a property that was on the market for a long time and as we were about to close the deal suddenly a new bidder appeared. We were certain that it was fake, simply trying to force our hand into a higher offer. We said we'd call the bluff and didn't counter offer. A few weeks of radio silence later then we noticed that the house was sale agreed and we were out! Now we're back house hunting and it's been very unsuccessful so far in a rising market. Big mistake on our part.

I'm sorry that's awful....it sucks out there at the moment

adocholiday

ClubDead wrote: »

I'm sorry that's awful....it sucks out there at the moment

Awful yes but entirely our own fault. I don't think that there are too many estate agents out there making up bids, particularly in competitive areas like the East. We let some people lead us into that belief and ultimately lost out. Of course there are probably some genuine cases of fake bids and that kind of carry on but I imagine that it happens in a very low percentage of sales.