
Myth or truth – what a real estate agent can and cannot do (Part 3)
Myth 1: Real estate agents and their duty to investigate
Real estate agents do not have any in-depth duty to investigate the owner (information on building permits, etc.). They can rely on the information provided by the seller. Although the seller is obliged to tell the truth, they may not know everything, for example if the house has a long history with many previous owners. It is therefore often difficult to prove liability based on information provided by real estate agents.
This myth is partly true.
There is an obligation to make all information known to the broker available to interested parties in a comprehensible manner. Real estate agents are able to do this thanks to their expertise. The broker is also obliged to carry out professional investigations, the results of which must also be passed on. Agents can only be held liable if they knowingly concealed something. The situation is different if the seller demonstrably withholds information from the agent. In this case, the agent is not liable. Overall, however, case law has become stricter towards agents in recent years.
Myth 2: Brokers favor buyers
Agents are under pressure due to fierce competition. If there are many applicants for a property, the agent will favor certain groups of buyers. These include visually attractive people who are articulate. Whether they can actually afford the property is only determined afterwards.
This myth is not true.
If there are many applicants for a property, it is the agent's job and core competence to check in advance which interested parties can afford the property and will be invited to view it. A credit check is carried out in advance for this purpose. After all, financial security is ultimately the most important thing for the seller. It should be clear in advance whether the sale is likely to fail due to uncertain or insufficient financing. Real estate agents also have more options for checking this than private individuals. A property is only reserved if the buyer can provide proof of financing. This is also checked by the real estate agent. Ultimately, it is the owner who decides to whom the property is sold.
Myth 3: Financial advice from the real estate agent
Not all real estate agents offer independent financial advice.
This myth is true.
Not all real estate agents offer advice on real estate financing. Agents who do offer this service either work with their own specialist department with specially trained staff or collaborate with financial institutions. In these cases, they can assist interested parties with the transaction. Real estate brokerage is separate from the service mentioned above.
Do you have questions about buying or selling a property? Or would you like advice? Then get in touch with us. We will be happy to assist you.
Notes
For reasons of readability, the generic masculine form is used in this text. Female and other gender identities are expressly included where necessary for the meaning of the text.
Legal notice: This article does not constitute tax or legal advice in individual cases. Please have the facts of your specific case clarified by a lawyer and/or tax advisor.