Fake bids being used to drive up house prices, Fianna Fáil claims

House bidding process not transparent, says Barry Cowen

 

Fake bids are being used to drive up house prices, according to Fianna Fáil.

The party’s spokesperson on housing Barry Cowen said “dishonest practices” such as fake bids are making the “tense situation” of buying a home a lot worse.

“We have anecdotal evidence that the current bidding process is not transparent,” the Laois-Offaly TD said.

Fianna Fáil has published a proposed new bill which it says is designed to ensure that the practice of non-existent bids being used to drive up house prices “is ended by opening up information on the bid during the process, and not afterwards as is effectively the case at present”.

The Property Services Regulatory Authority (Amendment) (Bidding Transparency) Bill 2017 puts in place a 10-day statutory timeline for the PSRA to confirm the existence of other bids on a property with the estate agent. Failure to adhere to the proposed law would result in a fine of €5,000.

“While there is a complaints procedure it is rarely used and it is not fit for purpose as it is quite a lengthy and time consuming process,” Mr Cowen said.

“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.”

Mr Cowen said the bill puts in place a “swift 10-day mechanism” for a potential buyer to confirm the existence of what they believe to be a “suspicious, potentially fake” third-party bid they believe is being used to drive up the sale price.

“Estate agents will have to provide the PSRA the details confirming the suspect bid and the PSRA will then confirm it to the complainant. Failure to provide the information will result in a hefty fine and further investigation,” Mr Cowen added. “The national average list price is now almost €241,000, 8.9 per cent higher than just 12 months ago. The housing crisis is making the dream of home ownership even more unobtainable for many young families who are starting out in life.

“While not a silver bullet to all the challenges in the housing market, it will shed light on the process, provide transparency and ensure that all parties are operating fairly.

“It will help put an end to exploitative practices and create an even playing pitch for all would be home buyers.”