I was recently viewing a property to buy in the UK, with an asking price of £400k. On the day of the viewing, but before my appointment, the estate agent informed me that two offers had already been made that same day, and both had been accepted. Although he couldn't reveal the amount of these offers for legal reasons, it was "not worth me making an offer below the asking price". So, I make an offer for £407k, and this was accepted. After thinking this through, I am now wondering how likely it is that these two other offers were genuine, and how likely it is these two offers never actually existed, but were made up to encourage me to make an offer over the asking price.
As another anecdote, after a previous viewing at a different property, the estate agent informed me that an offer for the asking price had just been accepted, and asked whether I would like to make an offer to myself. I replied that I was not interested in making an offer, but then only to find out a few days later that an advert for the same property was re-listed at £10k below that original asking price. Yes, I know that often the finances don't work out and the buyer has to back out, but it certainly seems possible that in that case too, this other offer was fake.
So, my questions are (and relating specifically to the UK, but other comments welcomed):
When estate agents state that other offers have recently already been made and accepted, is it common for these to be fake? If anybody has any real insider knowledge about this (e.g. if you are / have been an estate agent yourself), comments would be welcomed on how often estate agents make up other offers when trying to get a buyer to increase their offer.
Is it actually defined in law that it is illegal for estate agents to suggest that other offers have been made, when this is completely untrue?
If I was suspicious about the estate agent faking an offer, how could I go about finding out the truth? If I were to ask the estate agent, he would certainly say to me that it was not within his capacity to reveal the details of his other clients who made these offers. So it seems difficult to ever know, even if you were very suspicious.