Real estate agents pose a bridge between the seller of a property and potential buyers and receive a certain percentage from the closed deal. However, it’s important to know that they make that money only and exclusively if that deal is closed and the transaction is made. It is also important to realize that real estate agents want to sell as many houses in as little time, as that makes them the most profit. For that reason, it’s not far-fetched that they’d want to lie about certain things, especially other offers on the same house, to urge you into buying it. Quite a clever manipulation tactic from a psychology standpoint, you have to admit.

Exactly that possibility of your real estate agent lying about other possible offers to you to make you buy a house as soon as possible is the topic of this article, as well as what to do in that case. Should you report the agent, or should you just drop them and move on with your property search? Are they even allowed to disclose these other offers to you, the purchaser? And how to spot a lying real estate agent?

To find out answers to all of these questions, continue to read on…

Role of Real Estate Agent When You Purchase a Property

The agents representing buyers in the whole transaction are called buyer’s agents, as opposed to the listing agent, an agent who represents the seller. Both are licensed real estate agents whose job it is to work in your best interest, no matter if you’re buying or selling a property.

In some cases, one agent might represent both parties. It’s called “dual agency”. This is, however, highly illegal in some countries and states, and even in parts that it’s legal, it’s highly frowned upon as it’s hard to stay objective when representing both sides.

Tip: Don’t get confused. In some countries, e.g. in Australia, the term Dual Agency is used when the seller/vendor appoints two listing agents to sell their property. In this way, some competition between listing agents is created to get the best outcome for the seller fast. In return, agents likely to receive a higher commission.

Some of the benefits, or rather some of the helpful roles a buyer’s agent can play in the whole ordeal, are:

  • Representation

A house seller will more often than not have a real estate agent representing them, so it’s beneficial for you to have someone experienced to represent you too, or at least give you their expert opinion.

  • Negotiating Experience

House buying and selling is all about negotiation. The buyer will want the price to be as high as possible, while the buyer will try to lower the price as much as possible. Your agent is supposed to know what the trends are on the market and negotiate accordingly.

  • Market Experience

This is connected to the previous point. A good real estate agent is supposed to know what’s happening on the market, especially in the area where you want to buy a home. Their market knowledge can find itself to be beneficial.

  • Neighborhood Experience

Another point connected to the previous point is that your real estate agent should be familiar with the neighbourhood they’re operating at.

They should be able to tell you about the schools nearby and other important facilities, and also the price range of houses for sale in the vicinity.

  • Home Search

Finding a home with all of the key factors you want it to have is a tiring business. Going through every listing in the area, and then going through each is time-consuming. Having a real estate agent to do these things for you can come in handy.

  • Paperwork

If this also sounds tiring to you, or you’re not familiar with all the legal paperwork that comes with buying a house, having a real estate agent to help you that is beneficial.

  • Access to more experts

Real estate agents can help you connect to all helpful experts you might need during the process of buying a house – from home inspection contractors to mortgage lenders and so on.

Common Scenarios When Real Estate Agents Lies

Like we’ve established already, real estate agents might lie to get ahead. It happens in every profession arguably, but in real estate, lying is quite ‘popular’.

Here are a few common situations where real estate professionals lie.

First, I’ll highlight some general situations, and then some more specific situations, as well as ways on how to recognize them.

  • Misleading description

In this case, the agent might make the property seem like a big deal, they’ll use enchanting words to describe the property, and they’ll make it seem like an opportunity you absolutely can’t miss.

To avoid this, inspect the property yourself or hire a certified property inspector. Then compare the property with the rest of the market in the neighbourhood.

Remember, any property can be an exception if your heart falls in love with it. Make sure to put brains to work before your heart.

  • Inflated value

Agents will do this to maximize their own profit. As a side effect of this, the price range of every property in the area will rise, which can be quite dangerous. Always check the prices of properties in the neighbourhood.

  • Made up buyers

This tactic is commonly used to lure you into accepting any offer, as high as it might be, just not to lose the property you want.

The ethics and legality of this will be discussed thoroughly later in the article, but it’s important to note that it’s a possibility and a very much common one.

Further Common Tactics to Look Out For

As a beginner investor, it’s important to recognize the scams real estate agents might use to make you buy a house. Here’s a list of some more specific situations to look out for, as keeping an eye for the little details has the potential to save you quite a lot of money.

  • Decoy listing

Real estate agents will post a gorgeous home in a nice neighbourhood but will not post the specific address of the said property. That way, when a potential buyer interested in that property calls, they can pretend that one has been sold and offer you a similar one. This one can be easily recognized; if you call about a property, and you’re told it’s no longer on the market, yet it remains as a listing, it’s properly a decoy.

This practice is illegal in Australia.

  • Old listings

Similarly, to the previous one, agents will sometimes leave already purchased homes up to attract calls from interested potential buyers. The more calls they receive, the more possible sales they might score.

This practice is also illegal in Australia.

  • Dual agency

This term has already been defined in one of the previous paragraphs and has been deemed as highly controversial. However, that doesn’t stop agents from doing it, and they will oftentimes direct potential buyers to the property they’re also representing.

This way, they may get double commissions, and you might miss out on all the better opportunities because of the agent’s greed.

  • Not representing other properties on offers

Connected to the previous point, some agents might even go to the extent of flat out ignoring other agent’s listings and only present the properties they’re representing to the buyers. Once again, this is a clear way to score greedy commissions.

What Not to Say to an Agent When You Are Searching To Buy?

While still on the topic of beginner-friendly tips, let’s focus on some things you should never tell your real estate agent when buying a home.

  • Budget

Whereas you will need to elaborate on which price range you’d like to stay at, never be too specific about it.

For example, if your maximum budget is 1.5 million, it’s be better to just say you’re looking for something in 1 million range. That way, you’ll receive offers that are both under and above that number instead of the agent focusing only on properties as close to that number. To make as much profit, of course.

  • Timing

Keep all of your deadlines to yourself. Revealing this will make you emotionally vulnerable and easy to manipulate during the negotiations. Like that, you might end up making the wrong decision while under pressure and buying the home you don’t want. Just a needless waste of money.

  • Personal information

While you will need to share some personal information, and you might also get quite familiar with or comfortable around your agent, some personal details should stay exactly that – personal.

More might need to be revealed during the negotiation, but not in the process of looking.

  • Price

Do not walk into a home and speculate on how much it’s worth without doing any research on similar properties in the vicinity.

If you offer too high of a price, the agent will go for it, even if the house isn’t worth that much. And, if you offer too little, you won’t be taken seriously.

  • Lies about being interested

Playing games in the real estate business is a large no. Don’t pretend you’re not interested in the property when in reality, you are. You’re just risking losing that property, the house that might be your dream home. Honesty is the best game to play in that situation.

Can Real Estate Agents Legally Disclose About Other Offers?

Real estate agents aren’t by law allowed to disclose anything about other offers. However, the seller themselves is allowed to do so.

Allow me to elaborate…

When the seller and their agent sign their disclosures, the seller is presented with three options.

  • Disclosing nothing at all,
  • Disclosing only the existence of other offers but not the amount or terms, and
  • They have the ability to disclose everything.

According to a famous real estate agent, the second option is the most common among the sellers.

The third option is called the price escalator or acceleration clause. This is considered unethical by some real estate agents and is highly frowned upon, even though it’s legal.

However, there’s a certain scenario when this is illegal. That is, when the real estate agent, or the seller, make up a fake offer. By NAR’s “Code of Ethics”, Realtor are required to be honest and transparent with all parties, so making up something like that can bring the Realtor into legal troubles.

Some of the advantages of being open about other offers include:

  • Shortening the negotiation times,
  • Eliminating the competition and
  • The seller is perceived as more open and honest.

On the other hand, this might be perceived as a trick to make the seller pay more. And it is extremely risky.

Can Real Estate Agents Lie About Other Offers?

As mentioned in the previous section, there is a certain code of ethics that relators are expected to abide by. It’s NAR’s “Code of Ethics” that every proper real estate agent will follow. This, however, doesn’t mean every single real estate agent you stumble upon is trustworthy and will respect that document.

And the bad news is that not abiding by that document isn’t illegal. In other words, if a real estate agent makes up other offers on a certain property for whatever reason, they won’t end up in jail for it.

There is also a thing named Property Ombudsman membership, where real estate agents are required to agree to the Code of Practice, which allows them to be punished and expelled in case of any unprofessional action that breaks the rules laid out in the agreement. As you might have already guessed, one of the rules is not making up offers or any other details.

Do Real Estate Agents Fake Counteroffers?

The mention of Ombudsman membership and their Code of Practice is extremely relevant for the topic of this article. As elaborated, not following the guidelines from the Code of Practice can result in a real estate agent having their membership cancelled.

Having the Ombudsman membership is a great privilege, so having it cancelled will bring huge damage to the guilty real estate agent. Their reputation and credibility will end up ruined, and that will, naturally, affect their business badly.

For that reason, real estate agents are reluctant not to abide by the Code of Practice and make up a counteroffer.

Let’s focus on some basics, though.

What’s a counteroffer, when is it done, and how?

A counteroffer is an offer given as a response to a listing that signifies a rejection of the said original offer. When a seller lists their property for a certain price, it’s not unheard-of that a potential buyer will make an offer, typically cheaper than the home’s initial price.

The buyer then has the options to accept, deny, or make a counteroffer. Some of the common reasons for the rejection of the original offer may be the position of the property, the amount of time the property has been on the market, the condition of the property and so on.

Negotiation is exhausting and tricky, and should be left to more experienced individuals, such as real estate agents called buyer’s agents.

As it is so common in the real estate business – in this business, everything lies on negotiation – there’s a large possibility they’ll be a true expert in the field.

Can You Sue a Real Estate Agent for Lying About Multiple Offers?

No, you cannot sue a real estate agent for lying about multiple offers. As shown already, they have no law obligation on that topic.

What you can do, though, is reporting them to the Ombudsman membership for not following the Code of Practice, which will have them punished and expelled. And more or less ruined sooner rather than later when frequently complaints are recurved by clients. This only works if they’re a member of Ombudsman membership, of course.

Some more solutions for when you catch your agent lying to you will be presented at the end of the section…

Now, onto some common reasons why real estate agents get sued.

  • Not disclosing property defects

Real estate agents are legally required to disclose all defects like leaks or cracks with the house to the buyers. Especially if they are structural damages making property hazardous to live in. Similarly, boundary and unauthorized fences, driveway crossovers need to be disclosed too.

Of course, this may negatively impact their profit, so they sometimes don’t disclose them. This has the potential of endangering the buyers quite seriously. Therefore, this is punishable by law.

  • Negligence
  • Not keeping personal data personal

Real estate agents have access to a lot of personal information about their clients. Disclosing any personal data about their client is highly illegal, and thus punishable by law.

  • Receiving secret profits
  • Not informing seller about all of the offers on the table
  • Accepting or denying an offer without their client’s knowledge


At the very beginning, we’ve established that real estate agents only make a profit when, and exclusively so, they make a deal between a buyer and a seller happen. The real estate agent received a certain percentage, oftentimes about 3% of the sales value.

For this reason, it’s in their best interest to sell as many houses as possible.

In the article, we’ve explored the possibility of them lying to the sellers in an effort to achieve that.

Firstly, we’ve explained what role a real estate agent plays when buying a property – they’re a bridge between a seller and a buyer. There’s a long list of benefits for hiring a real estate agent when buying a home. However, if it’s your first time buying a home, or you’re just inexperienced with these things, next, we’ve focused on some common ways real estate agents will scam unsuspecting buyers.

We’ve gone through tactics and scenarios as well as ways to recognize them. To help inexperienced buyers, you can also find a list of things that ought not to be told to a buyer’s agent.

Finally, we’ve focused on the reasoning and legality of real estate agents making up other offers. While they’re not allowed to disclose them according to the Code of Practice, there are no legal obligations. The seller is more likely to disclose them, (if they can), though.

It isn’t a common practice for real estate agents to break the Code of Conduct, as this may as well ruin their careers. In case they do, there are some common reasons to sue the agent.