Hi all,
Went to auction on a house about 10 weeks ago, (lifestyle house Hamilton) auction was brought forward because of an offer, auction was opened and on the market at the offer price 2.3m, I bid upto 2.375m, it sold for 2.4m to the people that put the offer in.
I have been working with an agent for a year now trying to find us a house (not the listing agent) I get a call from my agent 4 weeks ago to say the buyers didn’t settle (ird frozen their accounts) did I want to put an offer in, so a couple days later I put an offer in on the phone to my agent of 2.3m, he then rung the vendors agent and the vendors came back with a counter offer of 2.375m (my bid) I returned an offer of 2.325m, my agent came back to me and said the vendors agent said he didnt present the price because the vendors would just walk away with that offer, Can I offer any more. My reply was, that I was unhappy that I bid against someone with illegitimate funds, the auction price had gone up because someone bid that should not have. So my agent went back to the vedors agent and came back to me that it wasn’t the ird that froze his account but the bank pulled out of the mortgage cause the original buyer was a business owner and he had injured himself and couldn’t work, apparently his 10% deposit was returned because of that. So I decided because of that legitimate reason I upped my offer and we agreed on 2.36m. Yesterday we met with the vendors of the house to show us how everything worked, he said he had heard multiple stories of what the excuse was and that they did keep the deposit.

So on one hand I got it a bit cheaper than what I was willing to pay at auction but on the other hand I bid against someone that didn’t have legitimate funds so the price was brought up.

What do you guys think?

House is unconditional, I have paid the deposit and we settle on the 22nd Jan.

Edited by daz59 at 8:09 am, Tue 12 Jan

daz59 - 2021-01-12 08:08:00

A few things to dissect here.
The agents have provided you with personal information relating to the first buyer. Why his contract collapsed is nothing to do with you – UNLESS it collapsed because of a defect related to the dwelling.
Secondly – the agent had no right not to present your first offer. That’s not his call to make. I would argue that it’s so close to where you actually landed that this is bunk.
Finally – yes you lost at auction against someone that ultimately didn’t have the funds, but assuming that when he bid he fully believed he DID have the funds (presumably that was before he injured himself) then an open market price was achieved*, so you have no complaint there.

*Noting that the auctions excluded potential buyers so the price might even have gone higher.

sparkychap - 2021-01-12 08:18:00

As above, you have every right to be annoyed and to formally complain about the agent.

As for the deal you struck with the vendor, no. Freedom of contract, meaning you had complete freedom to enter into the agreement on whatever terms you agreed or not to.

Edited by johnston at 8:46 am, Tue 12 Jan

johnston - 2021-01-12 08:46:00

You didn't bid against someone with illigimate funds. That agreement was clearly conditional upon finance.

johnston - 2021-01-12 08:50:00

Both agents = Naughty Naughty
Vendor = Gets 2.6m minus possibly two commissions
Buyer = Gets property 15k less than what they were prepared to pay

superdave0_13 - 2021-01-12 08:55:00

johnston wrote:

You didn't bid against someone with illigimate funds. That agreement was clearly conditional upon finance.

Thanks for the feedback.

There are no conditions at auction.

If his funds were locked by ird somthing dodgy must have been going on. He brought his “dodgy” money to auction.

That of course is if the ird reason was true. Who knows.

I understand the points regarding I shouldn’t have been told about the reason for the original buyer non settlement.

daz59 - 2021-01-12 08:57:00

What was the situation with the two agents? Did you employ your one? Were they competing agents from the same agency? A conjunctional sale?

superdave0_13 - 2021-01-12 09:27:00

superdave0_13 wrote:

What was the situation with the two agents? Did you employ your one? Were they competing agents from the same agency? A conjunctional sale?

Both worked for different companies. I didn’t pay him, but have been working with him to find a property for me. He will get his cut of commission from this sale.

daz59 - 2021-01-12 09:40:00

daz59 wrote:

Thanks for the feedback.

There are no conditions at auction.

If his funds were locked by ird somthing dodgy must have been going on. He brought his “dodgy” money to auction.

That of course is if the ird reason was true. Who knows.

I understand the points regarding I shouldn’t have been told about the reason for the original buyer non settlement.

It is not clear whether you were actually bidding at the auction. Were you? Did the original purchaser buy at the fall of the hammer? If the agent didn't present an auction bid please explain. Were you present? Or, are you referring to a pre-auction offer?

johnston - 2021-01-12 11:12:00

If the vendor gave up the deposit, either the purchaser was entitled to it or the vendor voluntarily returned it.

Edited by johnston at 11:13 am, Tue 12 Jan

johnston - 2021-01-12 11:13:00

johnston wrote:

It is not clear whether you were actually bidding at the auction. Were you? Did the original purchaser buy at the fall of the hammer? If the agent didn't present an auction bid please explain. Were you present? Or, are you referring to a pre-auction offer?

Auction opened at the reserve of 2.3m, I bid against the other guy, it sold at auction for 2.4m (i bid to 2.375m) buyer didnt settle so i got asked to put an offer in.

Vendor kept the deposit. You may want to re-read my first post.

Edited by daz59 at 11:32 am, Tue 12 Jan

daz59 - 2021-01-12 11:31:00

daz59 wrote:

Both worked for different companies. I didn’t pay him, but have been working with him to find a property for me. He will get his cut of commission from this sale.

So a conjunctional sale with the agents possibly in cahoots.

superdave0_13 - 2021-01-12 11:46:00

superdave0_13 wrote:

So a conjunctional sale with the agents possibly in cahoots.

Would think unlikely. Agents didn’t know each other before this property.

daz59 - 2021-01-12 12:03:00

Maybe not, but if they are not presenting each others offers there is a problem. They got you up 60k so it's worthwhile doing.

superdave0_13 - 2021-01-12 12:09:00

superdave0_13 wrote:

Maybe not, but if they are not presenting each others offers there is a problem. They got you up 60k so it's worthwhile doing.

Maybe, they did present my next offer of 2.35m, the vendors came back with 2.36m as i final offer they said.

daz59 - 2021-01-12 12:14:00

Oh well, It must be a fantastic house. Although not ideal, I hope that you can move in without too many concerns over the way the buying process went....

superdave0_13 - 2021-01-12 12:22:00

Sounds ok to me, you got a good house you want. That is the end of the story. Move on.

msigg - 2021-01-12 12:40:00

daz59 wrote:

Vendor kept the deposit. You may want to re-read my first post.

Which is contradictory to you posting apparently his 10% deposit was returned because of that.

johnston - 2021-01-12 12:43:00

Oh Hamilton agents, gotta luv em, everything the poster is thinking sounds just like them.

gabbysnana - 2021-01-12 12:58:00

johnston wrote:

Which is contradictory to you posting apparently his 10% deposit was returned because of that.

My agent told me it was returned but when the vendor took us through the house yesterday the vendor said he kept the deposit. My writing is not the best sorry.

daz59 - 2021-01-12 13:17:00

superdave0_13 wrote:

Oh well, It must be a fantastic house. Although not ideal, I hope that you can move in without too many concerns over the way the buying process went....

It is a nice house. I just wanted input from what others would feel in this situation.

daz59 - 2021-01-12 13:19:00

daz59 wrote:

My agent told me it was returned but when the vendor took us through the house yesterday the vendor said he kept the deposit. My writing is not the best sorry.

The agent had no right to disclose any aspect of the deposit to you.

To answer your question, yes annoyed with the agent. No, not annoyed with your purchase.

johnston - 2021-01-12 13:46:00

Don't get mad... get even !!

mechnificent - 2021-01-12 14:28:00

daz59 wrote:

Both worked for different companies. I didn’t pay him, but have been working with him to find a property for me. He will get his cut of commission from this sale.

So the seller is paying you? That seems unusual.

committed - 2021-01-12 15:55:00

The (real estate qualified) person acting on behalf of a potential purchaser is referred to as 'The Buyer's Agent'

https://www.settled.govt.nz/buying-a-home/finding-a-property
/buying-with-an-agent-or-privately/

At least the TA did not have to bid against some mystery offshore bidder, bidding through a 'tourette's like', hand waving, 'cellphone clamped to ear' agent on the other side of an auction room.

serf407 - 2021-01-12 16:33:00

serf407 wrote:

The (real estate qualified) person acting on behalf of a potential purchaser is referred to as 'The Buyer's Agent'
.

the “buyer’s agent” was not a Buyer’s Agent.

sparkychap - 2021-01-12 16:59:00

serf407 wrote:

The (real estate qualified) person acting on behalf of a potential purchaser is referred to as 'The Buyer's Agent'

https://www.settled.govt.nz/buying-a-home/finding-a-property
/buying-with-an-agent-or-privately/

At least the TA did not have to bid against some mystery offshore bidder, bidding through a 'tourette's like', hand waving, 'cellphone clamped to ear' agent on the other side of an auction room.

But here the agents were acting for the vendor. It is illegal to act for both parties in a transaction.

johnston - 2021-01-12 17:17:00

johnston wrote:

But here the agents were acting for the vendor. It is illegal to act for both parties in a transaction.

everyday in everyday.

gabbysnana - 2021-01-12 18:08:00

committed wrote:

So the seller is paying you? That seems unusual.

Unsure where you got the idea that the vendor is paying me.

daz59 - 2021-01-12 18:30:00

daz59 wrote:

Unsure where you got the idea that the vendor is paying me.

The seller is paying your “agent”? I would’ve thought that if you were employing a buyers agent, you would be paying them. If the seller is paying them, then they’re a seller’s agent.

committed - 2021-01-12 18:56:00

johnston wrote:

The agent had no right to disclose any aspect of the deposit to you.

Unless they had written authority (which is unlikely).
But you never know, it could have been part of a cutting edge marketing ploy that hasn't infiltrated the rest of NZ yet. It did result in a sale though huh?

superdave0_13 - 2021-01-12 18:59:00

superdave0_13 wrote:

Unless they had written authority (which is unlikely).
But you never know, it could have been part of a cutting edge marketing ploy that hasn't infiltrated the rest of NZ yet. It did result in a sale though huh?

I doubt the first deposit had any bearing on the second agreement.

johnston - 2021-01-12 19:35:00

I wouldn't worry about it. (In this market) you got it 15k cheaper than you were willing to pay 10 weeks ago.

I know you feel like you were bid up by someone without the money. But if it wasn't them, it would have been someone else; and perhaps you would have missed out altogether.

Don't worry about it. You obviously like the place, and you've had another chance to consider making an offer. You've actually managed to have an offer accepted that was less than your earlier one; not many get that chance.

theo35 - 2021-01-12 19:44:00

committed wrote:

The seller is paying your “agent”? I would’ve thought that if you were employing a buyers agent, you would be paying them. If the seller is paying them, then they’re a seller’s agent.

Both agents (mine and the vendors), get a cut of the commission from the sale of the property. No idea what proportion each agent gets.

daz59 - 2021-01-12 20:53:00

theo35 wrote:

I wouldn't worry about it. (In this market) you got it 15k cheaper than you were willing to pay 10 weeks ago.

I know you feel like you were bid up by someone without the money. But if it wasn't them, it would have been someone else; and perhaps you would have missed out altogether.

Don't worry about it. You obviously like the place, and you've had another chance to consider making an offer. You've actually managed to have an offer accepted that was less than your earlier one; not many get that chance.

Thanks, yea I guess that’s the best way to look at it.

daz59 - 2021-01-12 20:54:00

daz59 wrote:

Both agents (mine and the vendors), get a cut of the commission from the sale of the property. No idea what proportion each agent gets.

Common in Hamilton I found. Weird when we moved here as I haven't experienced it elsewhere but yep both agents are paid out of the vendors commission. You can tell the houses that sell like this as they often have two different RE agency's signs with SOLD on them.

hers.nz - 2021-01-12 21:49:00

I would have offered $2.2m then let them stew on it for a week or two, and seen what they come back with then.
Even if they countersigned higher I'd then give them another week to stew.
They say good things take time.

Edited by mrcat1 at 10:30 pm, Tue 12 Jan

mrcat1 - 2021-01-12 22:28:00

daz59 wrote:

Both agents (mine and the vendors), get a cut of the commission from the sale of the property. No idea what proportion each agent gets.

The irony is that if you had employed a buyers agent, one that you paid for, you may have been able to purchase the property for less than you did.

https://wiseup.nz/buying-property/guide-to-buying-a-house/bu
yers-agent-nz

Edited by committed at 7:07 am, Wed 13 Jan

committed - 2021-01-13 07:04:00

hers.nz wrote:

You can tell the houses that sell like this as they often have two different RE agency's signs with SOLD on them.

I cannot see how that is legal or could be condoned by agencies.

johnston - 2021-01-16 08:58:00

daz59 wrote:

Both agents (mine and the vendors), get a cut of the commission from the sale of the property. No idea what proportion each agent gets.

In Hamilton, company gets 50% (They will have B2B deals on how that is split) the listing agent gets 25% and the selling agent gets 25%, some companies if it is split between the 2 companies, the listing agent gets 30% and selling agent 20%.

gunnernz1 - 2021-01-16 09:11:00

johnston wrote:

I cannot see how that is legal or could be condoned by agencies.

Never seen it. Its always the listing company (Havent seen a general listing for years, do they still do them)

gunnernz1 - 2021-01-16 09:15:00

gunnernz1 wrote:

Never seen it. Its always the listing company (Havent seen a general listing for years, do they still do them)

I have not seen it either. General listings are rare nowadays. Perhaps most often seen with new builds and over priced turkeys.

johnston - 2021-01-16 11:15:00

johnston wrote:

I cannot see how that is legal or could be condoned by agencies.

I wouldn't think so either but there was one property just down the road from me that had both "L" agencies sold signs on it in December.

hers.nz - 2021-01-16 12:10:00

daz59 wrote:

It is a nice house. I just wanted input from what others would feel in this situation.

I would have gone back in at 2.1m, and when they rejected it I would have said no.

I made an offer on a house the first day it was on the market (3 doors down the road) and at 6 pm the agents knocked on the door and said they had another offer, that I should present my best offer. I did. At 6:30pm they knocked on the door again and said I was close, another 15K would clinch the deal. I asked them what part of "best offer" they didn't understand and told them to FOff. At 7pm they came back with the signed contract.

gyrogearloose - 2021-01-16 19:09:00

gyrogearloose wrote:

I would have gone back in at 2.1m, and when they rejected it I would have said no.

I made an offer on a house the first day it was on the market (3 doors down the road) and at 6 pm the agents knocked on the door and said they had another offer, that I should present my best offer. I did. At 6:30pm they knocked on the door again and said I was close, another 15K would clinch the deal. I asked them what part of "best offer" they didn't understand and told them to FOff. At 7pm they came back with the signed contract.

The agent is, of course, working for the seller. No surprises that they tried to get more money for their client. But, yes, in the OP's case, they may have been able to buy the property for less, especially if they had employed a buyer's agent.

committed - 2021-01-17 11:18:00

Not that there are many real buyers agents in NZ, apart from a few that operate for high paying overseas buyers.

Plenty of fake ones at the likes of Harcourts.

sparkychap - 2021-01-17 12:45:00