Buyers Beware - the real cost of “free” buyers agents
Some advertisements have appeared recently offering "free" buyers agent services, and even promising cash back to buyers using their service. The Real Estate Buyers Agents Association of Australia (REBAA) warns buyers that these operators were acting in the best interests of sellers, not buyers, and that only a buyer’s agent paid by the buyer had a legal obligation to act in their best interests.
Scott McGeever, REBAA Qld Representative and Principal of Property Searchers, said Brisbane buyers particularly should beware, as they were being targeted. “They should be very wary of anything that sounds too good to be true – especially offers that promise to give cash back to buyers.”
REBAA president Mr Byron Rose said there was no such thing as a free lunch, and this saying was never truer than in the real estate industry. “These operators are relying on being paid by taking a cut of the selling agent’s commission, known as ‘conjuncting’, said Mr Rose. “However, many of the larger and more professional selling agents have a policy of not accepting conjunctions, while other selling agents would only conjunct on properties that they have had difficulty selling. The reality is that these “free buyers agents” really only have access to second rate properties that the rest of the market has rejected and unsuspecting buyers could be stuck with a lemon.
“The industry has always attracted its fair share of ‘shonky’ selling agents and it is disappointing to see some of these unscrupulous operators are now promoting themselves under the guise of being a ‘free buyer’s agent’ to take advantage of innocent buyers. Some of them claim to be selling agents, buyers agents and financiers all-in-one, so they have a complete lack of independence in the buying process.”
Mr Rose said the concept of buyer’s agents emerged as reputable agents recognised that whilst selling agents were on the side of sellers, there was no-one looking out for buyers. “Only independent, accredited buyers agents who are paid by the buyer are committed to finding quality property for their clients, and have access to all properties available for purchase in the market,” he said.