A Foolproof Guide to Legitimacy

A foolproof guide to legitimacy:
How to find out if your agent is lying to you or not!

Business transactions are a lot like double-edged swords—it can be put to your advantage and in some unfortunate cases, your loss. If you are quite new to these kinds of things, then you should know that not everyone can be trusted, especially when you are just starting out with your property investments. Sure, giving someone the benefit of the doubt has its perks⁠—but keep in mind that the transparency between you and your broker must prevail.


I’m no stranger to these client-to-broker stories, a lot of which the clients were promised by their real estate brokers a lot of conceivable pretenses, only to find out that some of those promises failed to meet expectations.


As a way to help you see through and size up your agent’s trustworthiness and to prevent making rash decisions, here are some of the most common lies you need to be aware of that some agents might tell you to get your This might as well also serve as a guide for real estate brokers who want to build a brand hinged on honesty, transparency, and reliability while avoiding bad practices that taint the public perception of our noble profession. 

LIE #1. When your agent says buying is better than renting.

 Owning properties always have costs that will be attributed to your purchases and to the sale. For example, what if you only intend to live in the property on a short-term basis—for two to three years, perhaps? 

Did you know that when you buy something you also have to pay taxes and when you sell you have to pay commission and another round of taxes as well? 

For instance, the capital appreciation of the property is not enough to take hold of these expenses, then you’ll probably end up with a loss. It’s not always feasible that once you buy a property, you’re automatically going to make money—especially when you invest in property for end-use. Generally, keep in mind that buying is only better for long-term use. When your agent tells you that it’s always better to buy than to rent, ask yourself “How long will I be using this?”—if it’s going to be short term, consider renting, if it’s going to be long term, then consider it safe buying.

 LIE #2. When your agent says the more units you buy, the better the return.

 Some agents might prod you to have plenty of units rather than just have one or fewer—only because they want to sell more and gain commissions. You have to be careful, because having a lot of units rented out means dealing with multiple tenants with each multiple issues. Not all tenants would be quite agreeable or driven to give you less headaches, especially when you are dealing with ones from lower tier developments—raising concerns, maintenance repairs, and the like.

The more units you own, the more things you have to consider and challenges might grow exponentially as you manage more units in your portfolio. However, complaints under higher-end properties are not as common since they have better property management and build quality as opposed to lower-tier developments. 

You also have to take into consideration the costing and the Return on Investment (ROI). Try to compute to know how much your return will be after deducting your expenses from either renting or owning the property. Now, if the yield is actually higher in contrast to having fewer units—then by all means, go for it. There are certain benefits when you have multiple units, especially if it’s scattered throughout different locations and you would be able to spread the risk. Then again, if you know what you are doing, you did your homework and studied the market, you have an investment plan complete with a time horizon, objectives, and target ROI—then you don’t have to worry about picking a lot of properties or spreading them out in different locations. Just be wary and strategic with your calculated locations so you can make the most out of your deals.

LIE #3. When your agent says that investing in property offers 100% capital appreciation guarantee with zero risk. 

Your agent might promise you that after five years you’ll be guaranteed to earn a hundred percent on your investment or that he/she can be sure to rent it out of a certain price upon turnover. Note that these statements are not entirely true because no one can predict the future. There are no crystal balls here, no divination and hocus pocus and no, we are not Nostradamus. What we can do though, is to look at past performance to give you a glimpse of how the property might perform in the future. For example, most reputable developers will provide a track record of capital appreciation, and some companies might give you investment insights or data on how certain areas and developments fare in the market over a certain span of time. 

Always keep in mind to double check everything that your agent tells you to avoid impulsively investing on a property that might not live up to your expectations at all.

LIE #4. When your agent lays out false promises about after-sales services.

“Don’t worry, Maam, Sir!”—most agents would assure you a lot of things and would do their part with efforts in order to close the sale. I’ve heard a lot of stories from some clients that were ghosted by their agents after getting their contract to sell and got their commissioned pay and then when they had issues or concerns to complain to the developer or the project, they suddenly could not get a hold of their agent for advice. 

There might be instances that you would be tempted to ask for the commission, a portion or even the whole commission of the agent. Keep in mind that if you would do this, do not expect a hundred percent full service for loyalty given to you because you took hold of your agent’s bread and butter.

I strongly don’t recommend taking your agent’s commission or rebates—it's ethical and it would really be a bad practice that would lower the standards of the real estate profession once you get a hold of a legitimately experienced broker who would give you their full service. Paying then the commission would be worth it, especially if you make money on your investments. If the situation permits and you’re happy with the way your property is managed and your broker does not leave you in the dust when you have raised concerns, think of your agent as a consultant that is there for your aid in terms of buying or selling. Try to find an agent that will have you best interests at heart—maybe then you’ll be guaranteed your deserved level of satisfaction. Just do make sure to compensate your agent reasonably for their service to you.
Try to find an agent that will have you best interests at heart—maybe then you’ll be guaranteed your deserved level of satisfaction.

LIE #5. When they lie about their experience.

Always ask questions to your agent. Ask them about their experience, the number of years they have already been in the industry, and how many clients they have already helped. Some agents might get shaken off and lie about these things to hike up their credibility and thereby gain your trust in the process—they don’t want to appear as if they are a new standard to the industry. If you still remain skeptical, you may opt to ask him or her about specifics regarding their transactions or ask his or her particular clients for firsthand experience. Don’t let your guard down and continue to ask questions—the more specific they are, the better. Sooner or later, you would be able to tell if you are being lied on to, take note of your agent’s answers and reflexes because he or she will probably stutter or blank out coming up with answers to your questions if they weren’t as experienced as they say they are in the first place. 

However, keep in mind that asking is different from interrogating—therefore always inquire about these kinds of information courteously to avoid the risk of having them offended. Maintain the equilibrium between you and your agent, no matter what.

Now that you’ve been briefed on the possibility of dilemmas brought by real estate transactions, do not be afraid of a little detective work. It’s better to be a hundred percent skeptical than believing someone by default—a rough translation of It’s better to be safe than sorry. Not all real estate brokers are set to fool their clients so be mindful and give them the benefit of the doubt, just with limitations. Let me tell you another bonus tip to get by: Protect yourself by putting critical points into writing. As a general rule, if you are still doubtful over a certain aspect of the deal, like the payment terms that vary every day for example, or anything that gets your second thoughts all riled up—ask for a written deal or an email from your agent that would assure you of its validity. That way, if something goes wrong or there’s a rupture between the things promised to you, you would have a document to back you up.  

Remember: Be wary. Be strategic. Be careful. The outcomes of your deals would always depend upon your decisions and always be skeptical to avoid impulsive resolutions. There is always a price between these transactions—and knowing your way around these deals would definitely help you stay out of sticky situations. Stay alert!

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