The Government is eyeing tougher regulation of companies that buy and sell homes in private deals in a bid to protect consumers.
It follows revelations in yesterday’s Weekend Herald that an elderly cancer sufferer has just days to save her Mangere house after signing it away in under three hours without talking to her relatives or lawyer.
Sarah Ewe, 72, says she did not realise she was signing a sale and purchase agreement for $560,000 when Auckland House Buyers sales rep Peter Lee called at her house in November.
Her family believe the widowed great-grandmother has been take advantage of to secure a cheap deal and there is no way she gave informed consent.
Several Herald readers have offered to help the family, with one forwarding his lawyer’s contact details and promising to cover any legal costs associated with fighting the sale contract.
But there are now growing calls for better regulations of no-commission, fast sale property buying companies or a law change to give consumers greater protection.
Consumer Affairs Minister Jacqui Dean acknowledged the Ewe family’s distress.
She wanted anyone who felt they’d been deceived in a private treaty house sale to contact her office so the scale of the problem could be assessed.
“If it is an ongoing concern we would look into the wider issue.”
Auckland House Buyers has refused to comment, but denies misleading Ewe and maintains the sale price was fair.
Meanwhile, a South Auckland budgeting service says it knows of several families targeted by companies offering no-commission purchase offers well below market value.
Mangere Budgeting Services Trust chief executive Darryl Evans told the Herald on Sunday tighter rules were needed to counter operators who were simply out to make money.
“It’s just awful. You’ve got to be aware of the con jobs.
“It’s profit over people and I hate it.”
Evans said it was common to see the companies’ signs while driving around South Auckland.
“They’ll call it advertising. I call it preying on people’s vulnerability.”
They were often attractive to homeowners who had racked up debt and wanted to cash up in a quick sale without paying hefty agency fees.
But in Evans’ opinion the deals were usually too good to be true and he advised anyone contacted by one of the companies to consult a lawyer rather than risk under-selling their biggest asset for $100,000 or more below market value.
Mangere MP Aupito Su’a William Sio was appalled by the Ewe family’s case and planned to contact them to offer his assistance.
“Too often we’ve got these situations in generally working class, low income areas where they are easily taken advantage of by unscrupulous [traders].
“But elderly people on their death bed? This woman is undergoing treatment for cancer. She is not in a state of mind to be able to make good quality decisions about assets.”
Sio was unsure if the Consumer Guarantees Act applied in this case.
“But if it doesn’t it should.”
To prevent similar cases, sellers, particularly the elderly, should be given a “cooling off” period in which they could change their minds and back out of the deal.
This might require a law change, he said.
“It’s about protecting vulnerable people from relinquishing their assets without having the full information about their rights.”
Labour’s housing spokesman Phil Twyford backed calls for a tougher regime.
He said the companies were unregulated, labelling them the real estate equivalent of parasitic clothing trucks and finance firms.
“When you’ve got a company that’s doing this systematically you have to wonder whether there’s a need for a bit of accountability and some protection for consumers.”
A family spokeswoman said Ewe was overwhelmed by the response from the public yesterday and thanked people for the kind offers.
– Herald on Sunday