There are several different types of real estate agents operating in Spain, though in many cases foreign buyers are unaware that they face a choice. Different types of Spanish real estate agents provide varying levels of service, so it helps to understand the alternatives before choosing which ones to deal with.
Spanish real estate agents (owned and run by Spaniards)
Many more Spanish agents will belong to either the API or GIPE professional associations, which on the whole indicates a higher level of training and some level of professional indemnity. Nevertheless, it should be pointed out that the API and GIPE titles are often abused, and are therefore not a reliable guide to professional service.
Furthermore, many Spanish-run estate agents, be they API or GIPE accredited, are no better than estate agents run by foreigners. So nationality is no guide to quality, but at least Spanish nationals can understand contracts and other documentation in Spanish, which is more than many foreign agents working in Spain can do.
Spanish estate agents tend to cover their local area, though there are also some national chains and networks that cover the country. Spanish agents often don’t speak English and this can create a language barrier for British buyers. Nevertheless it is increasingly common to find local Spanish estate agents with English-speaking staff, especially on the most popular coasts.
Foreign owned-and-run estate agents in Spain
Foreign owned-and-run estate agents in Spain tend to focus on buyers from their home countries, so British and Irish agents focus on the British Isles, Germans on Germany and so on. British buyers usually end up working with British or Irish-run estate agencies, though most foreign agents are adopting English as their operational language and the alternatives are increasing.
It is now very easy to set up as an estate agent in Spain. Deregulation means that no qualifications are required and barriers to entry are low. With a modest capital outlay you can be in business and many of the foreigners who have come to Spain have ended up selling real estate for lack of professional alternatives, not to mention the high commissions that can be earned from property sales. It is unsurprising, therefore, that thousands of foreign-run estate agents (especially British) have sprung up in Spain, many of them very small operations that can stay in business on the back of just a few sales per year.
Unfortunately for foreign buyers a significant number of these estate agents are incompetent or unscrupulous. In many areas, especially on the Costa del Sol, Costa de Almeria, Costa Calida and Costa Blanca, the commissions charged are excessive (7.5% to 35% or more) and the service either cynical or incompetent. Pressure-sales techniques from the subtle to the outrageous are widespread and many buyers may be fed half-truths or lies in the course of their purchase.
Forewarned is forearmed. Buyers need to be aware that such organisations exist, and in greater numbers than most people might imagine. However, this should not deter anyone from buying in Spain, because there are also many excellent real estate agents in Spain run by upstanding professionals who take good care of their clients.
UK-based agencies offering Spanish property
Many UK-based estate agencies have started offering Spanish property, drawn to the business by the boom in the number of British people buying in Spain and the high commissions to be had.
Multi-listing networks in Spain
Many foreign estate agencies in Spain participate in networks through which they share clients, properties and commissions. Agency A may have a buyer but not the right property, whilst Agency B has the property but not the buyer. Therefore they collaborate and make the sale, splitting the commission.
There is nothing terribly wrong with this arrangement so long as the agencies split the commission rather than increase it as more often happens. When agencies increase the commission the buyer ends up paying an inflated commission for little extra value. The fact that collaborating agents tend to increase the commission partly explains why it is so easy to find same property being advertised by different agents at considerably different prices.
In many rural areas of Spain corredores still dominate the property market. Corredores are local brokers who know the local community and know when someone wants to sell a property. It is unlikely that a corredor in a rural community will speak English but in such places they are usually the best way of finding properties for sale. Despite the informality of this channel there is no reason why corredores should be any less trustworthy than your average foreign estate agent. Corredores often charge a commission of 1% to the buyer and 1% to the seller, so they are much cheaper to buy from than foreign agents, who may be adding on a commission of 35%. The problem is you will have trouble finding and dealing with a corredor, as they don’t usually work from a commercial premises and probably won’t speak English.
© Mark Stucklin (Spanish Property Insight)