Ripped off by an Estate Agent

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This topic contains 11 replies, has 7 voices, and was last updated by Profile photo of Anonymous Anonymous 10 years ago.

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  • #52329
    Profile photo of Anonymous
    Anonymous
    Participant

    I would like to warn anyone selling their property in Spain that you must get an Estate Agent to put his commission in writing and state both the offer price and what the Vendor will receive before accepting an offer. There will be great protestations over this because they tend to keep the offer price secret to allow them to take whatever they think they can get away with. In the Costa Blanca area we had a property agents seem to charge 10% and their excuse for charging this extortionate amount is that they sometimes have to split the commission as any Tom, Dick or Harry can set themselves up as agents with no premises and just the odd lead of who is coming over to look for property.

    We chose our agent last year because they had BSI (British Standards Institute) acreditation and we “Trusted the kite mark” so to speak. Album Properties SL of Villa Costa near Torrevieja valued our property then added 10% to market it. 3 months later they strongly advised us to accept an offer €55,000 euros under the original price and said on the phone that they had reduced their commission. Our Solicitor got suspicious when she couldn’t get them to state the offer price and bells started ringing. After a few emails the Manager confirmed that “Album Properties SL had taken less than 10% commission”. When we arrived in Spain to go to the Notary we found that the buyers Solicitor had Power of Attorney. We found out later that the elderley couple who purchased the villa had been told this was the procedure. What they were really up to was to keep the buyers away from us so we could not questions them before signing the documents. We afterwards discovered that Album Properties had taken €25,000 which was 15% of the offer price. They have not answered any of our correspondence so I reported them to BSI. As a result of a long investigation by BSI they withdrew Album’s registration. Within months Album Properties SL had gone out of business. Although we did not receive any of the money they defrauded from us we had the satisfaction of knowing that my complaint had resulted in their downfall. However, please look out for a certain Mark Johnson, the infamous Manager, who no doubt has got, or tried to get another job with another agent. Do not trust this man!! And don’t forget – question huge commissions and get it in writing before going to the Notary.

  • #66511
    Profile photo of Anonymous
    Anonymous
    Participant

    And for that very reason we always ask our vendors to sign and retain a copy of their sales contract stating their net price, commission % including IVA. It always amazes me though that some people refuse to sign a sales contact when obviously it is protecting their interest as well as ours.

    Jim

  • #66515
    Profile photo of Anonymous
    Anonymous
    Participant

    Thanks for your reply. I’m glad you get everything in writing. In hindsight we should have insisted on this but it all happened very quickly and with being told verbally that they had taken less than 10% and getting it in an email and with them being BSI registered, it didn’t occur to us that they would do what they did. Glad to see there are honest Estate Agents around in Spain. What is the usual commission in your experience?

    Linda

  • #66519
    Profile photo of Anonymous
    Anonymous
    Participant

    @lindapalmara wrote:

    We chose our agent last year because they had BSI (British Standards Institute) acreditation and we “Trusted the kite mark” so to speak.

    This is why if any business cites any form of registration, qualification, accreditation etc etc you must really check out for yourself what it ACTUALLY means.

    All BSI ISO 9000 accreditation means for an estate agency type business is that the company in question has been assessed (and met certain, mostly pen-pushing and paper-shuffling standards to improve efficiency, eliminate waste etc) in terms of Quality Assurance. It doesn’t mean that they’re legal,decent, honest and truthful. I know because in the 90’s I was working for a building contractor who was undergoing assessment for ISO 9000.
    And the BSI Kitemark applies only to products (NOT services, eg estate agency) to prove they’ve (i.e. the PRODUCT) been assessed and tested in terms of quality and safety.

    Take nothing at face value. Glad to see some justice done though.

  • #66520
    Profile photo of Anonymous
    Anonymous
    Participant

    Most of our properties are at 5% including IVA we have some at less this tends to be the higher value properties ie one at 1.6million is 3%. Not sure where you are but 5% seems the norm around here although there are always exceptions to the rule.

    Jim

  • #66522
    Profile photo of Anonymous
    Anonymous
    Participant

    Hi Linda

    unfortunately what you have gone through is all too common. Estate agents can and will deceive clients – fortunately not all. However depending on where you are 3-6% is about the Norm for Costa Blanca – however certain areas such as Javea and Moraira, have agents that charge much more.

    I also know of one UK based estate agent who bring clients over and insist they charge 15% on top of what the agent is charging. I had a friend working for them and he left for this very reason. However he then went to an agent that charges 10% – I guess by comparison it is less than 15% plus the agents commission.

    Also it is highly unadvisable NOT to sign an agreement – yet some people still do. An agreement is usually nothing more than an authorisation for the agent to sell your house at the agreed price which will include their commission (stated) including IVA.

    Most agents I know locally insist on signatures (we certainly do) then everything is transparent -and available for if and when a buyer asks how much commission is being charged we can produce the sales sheet signed by the owner.

    However I would advise anyone looking to buy a property in Spain – never ever give power of attorney to anyone – unless you really cannot make the notary. Then if you have to make sure it is someone YOU can trust – but the advice about independent solicitors springs to mind.

    Also be suspicious of anyone who tries to keep you away from the buyers/sellers. There is no need for this if everyone is being honest – so what does that tell you about the poeple who do leep buyer and seller apart?

    Vince

  • #66535
    Profile photo of Anonymous
    Anonymous
    Participant

    Thanks for all your input. In the last reply you said:

    However I would advise anyone looking to buy a property in Spain – never ever give power of attorney to anyone – unless you really cannot make the notary. Then if you have to make sure it is someone YOU can trust – but the advice about independent solicitors springs to mind.

    The buyers used the lawyer recommended by the Agent (Album Properties) and worked in Album’s interest. The elderley couple were told they must give POA to the lawyer, Mark Johnson said later it was to save them a journey to the Notary but they actually had to go along to the Notary a couple of days before to sign over the POA to their dodgy lawyer. He also took the whole of the money out of their bank, passing on €25,000 to Albyn before coming to the Notary with the remainder. No doubt he got a cut of that!

    I was also interested to hear that 5% is the norm. We did not find any agent charging less than 10%. We lived on the Orihuela Costa, 6 miles south of Torrevieja.

    Thanks to all

    Linda Wiggin

  • #66558
    Profile photo of Anonymous
    Anonymous
    Participant

    Hi Linda

    surprised to hear you couldnt find an agent down there for less than 10%. As I said I know Javea and Moriara agents tend to be more expensive but generally the norm is about 5% – many in Oliva charge 3% and even one or 2 were charging 1.5% – however they have since done a runner with clinets money so I guess thats how they justify there lower charges.

    Dont know Orihuela so cannot comment but it does seem a lot

    Regards

    Vince

  • #66603
    Profile photo of Anonymous
    Anonymous
    Participant

    We are estate agents and always insist that our commission rates and terms are written into the exchange contract. We almost never accept deposits from buyers and insist that the buyer, or his lawyer, pay the deposit as a cheque directly to the seller, or his lawyer, in the moment that deposit contracts are signed. Wherever possible, meetings are organised in our offices and both parties meet face to face.

    In this way, transparency is guaranteed.

    By the way, agency commissions in the in the greater Valencia area average 5 per cent.

  • #67628
    Profile photo of Anonymous
    Anonymous
    Participant

    I can’t believe that in other areas Estate Agents seem to charge between 2 – 5%! Something is very wrong in the Torrevieja area where we had our villa for them to charge 10% then hike it up to 15% or more if they can get away with it.

    Thanks for all your replies.

  • #67638
    Profile photo of katy
    katy
    Spectator

    Even on the costa del sol most agents only charge 5%, used to be 7& in the network (MLS) but that seems to have collapsed now.

  • #67661
    Profile photo of Anonymous
    Anonymous
    Participant

    I hear that some of the big agents take up to 25% on new developments in the South Costa Blanca – Torrevieja and places like that.

    The way those types of agents go about their business, they don’t deserve 0.25%. You should read some of the depressing stories I get sent.

    Mark

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