Buying a home is considered by some as one of the biggest financial decisions they will ever make in their lifetime. So should the person they are buying their forever home from – an estate agent – be trained to give them financial advice?
Adviser Points of View asks several property industry spokespeople what they think.
Russell Quirk, property expert, believes that there should be some sort of regulated financial training implemented for estate agents: “The estate agency sector remains largely unregulated as a whole which is quite unbelievable really, given the importance of their role as the linchpin within a sale. This has also led to the reputation of estate agents suffering due to the bad apples that can quite easily set up shop and drag standards down.
“Secondly, property expertise and financial advice are intrinsically linked throughout the process of selling a house. While an agent will often work with the best interest of the seller as the focus, it is the buyer who is taking the leap with what is likely to be the most expensive purchase of their life. Providing such consistency to customers through clear and constructive advice would be beneficial to all parties and make for a better industry overall.”
Warrick Swift, commercial manager of property inventory software firm Inventory Base, also believes that if a person is going to sell their home, they should seek independent financial advice from an IFA. Swift says: “In this particular scenario, it’s important to separate financial advice from sales. Financial advice should be in the interest of what is best for the person seeking that advice and as you could argue that estate agents have an invested interest in the sale of a property.”
Gerard Boon, independent mortgage and insurance broker at Boon Brokers said: “In an ideal world, estate agents would be trained to offer financial advice. We frequently hear clients inform us of general financial advice provided by estate agents which transpires to be false. Therefore, a more well-informed estate agent in financial matters would provide benefit to the client.
“However, there is a reason why a financial adviser has to work extremely hard to gain their appropriate qualifications – it is a complex area and people need to be properly trained to advise people on such important matters. A half-hearted amount of training for an estate agent could be more dangerous than none at all – and, in practice, it is highly unlikely that estate agents would remain in their industry if they were trained in financial advice and acquired the full and appropriate qualifications, such as the CeMAP.
“This is because, as financial service adviser occupations have higher gross annual pay than estate agent salesman salaries, on average, the estate agents may be likely to switch to the financial service sector following completion of their qualification.”