Wednesday 18 September 2019

FF at war with estate agents over 'fake bid' claims

(Stock photo)
(Stock photo)
Philip Ryan

Philip Ryan

Fianna Fail is at a war with auctioneers and estate agents over claims fake bids are driving up house prices.

The party is bringing forward new legislation aimed at clamping down on estate agents who use fake bids to increase prices before sales.

The new legislation would put in place a quick 10-day process for reporting suspicious bids.

This would allow the bidding process to continue and buyers would not lose out on homes they are seeking to buy to another buyer while the investigation takes places.

However, the lobby group for estate agents and auctioneers has written directly to Fianna Fail leader Micheal Martin and the party's housing spokesman Barry Cowen, calling on them to provide details of the spurious bids they believe to be taking place.

Institute of Professional Auctioneers and Valuers chief executive Pat Davitt said the party should report any evidence of fake bids to the Property Services Regulatory Authority (PSRA) and let the agency investigate the claims.

"If this anecdotal evidence remains uninvestigated it unfairly casts a dark shadow over all the law-abiding auctioneers throughout the country and their reputations," Mr Davitt wrote.

Speaking to the Sunday Independent, Mr Davitt said Fianna Fail's new laws were "opportunistic" and "didn't make sense".

"If the market wasn't going well there might be some grounds, but when the market is powering ahead, why would auctioneers want to make fake bids," he added.

Mr Davitt insisted his institute, which represents more than 1,100 auctioneers and estate agents, has never expelled a member for lodging fake bids to increase a house price.

He also insisted there were currently laws in place to allow people to make complaints about any suspicions they have about a bidding process to the PSRA.

Fianna Fail's Barry Cowen says his party has "anecdotal evidence" that the current bidding process is not transparent. "While there is a complaints procedure, it is rarely used and is not fit for purpose as it is quite a lengthy and time-consuming process. And such is the nature of the problem, by the time a decision has been made, the house has, in most cases, been sold to another buyer," he said.

PSRA chief executive Maeve Hogan this weekend confirmed that the regulatory body received a small number of complaints about fake bids.

"While I can confirm that the authority has received a small number of complaints in this vein, the number received is at such a low level that they are not grouped into a distinct and identifiable category," Ms Hogan said.

Auctioneers and estate agents are legally obliged to keep records of all bids made on properties so they can be examined by the authority. If they do not keep appropriate records and are found to be guilty of improper conduct following a PSRA investigation they can be fined up to €250,000 by the PSRA or have their licence to trade revoked.

Meanwhile, Fianna Fail's Pat Casey has written to Minister for Justice Charlie Flanagan asking for a public consultation on the effect gazumping has on the housing market.

Gazumping is when a house buyer, who has agreed a sale, is outbid at the last minute by a higher offer.

Mr Casey said the issue was affecting lots of young couple seeking to get on the property ladder.

The PSRA said it has received four complaints of gazumping since it was established in July 2012 and two complaints of gazundering, when a bidder tries to force an estate agent to sell at a lower price than first agreed.

Sunday Independent

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