- This topic has 295 replies, 40 voices, and was last updated 17 years, 8 months ago by
.
-
Posts
-
-
-
-
-
What could be better than estate agency “no longer being viable”! The agency game defies all economic logic here. When there are too many people in a marketplace prices/fees/commissions drop, people leave the sector and the industry finds a new equilibrium. Agents here claim that because there is so much competition and they do so few sales they have to charge exorbitant commissions. Economics of the mad house. Buyers have to wake up and demand a breakdown of the price between commission and “bricks and mortar”. My understanding is that under Spanish consumer protection law they have to provide this. Buyers have much more power than they realise. They should use it! Very few agents provide any “added value” which is the only justification for an intermediary earning a fee/commission.
James
-
I haven’t named the agent as I am very sceptical too. My friend had this agent over to put her house on the market and she was told then that in a couple of weeks they would reduce to 2%. their theory being that the smaller agents would have to follow (probably putting a lot out of business) and that the sellers would meet the agent half way and reduce their price accordingly and perhaps kick start a flat market.
My friend was told that it was confidential but I wonder how it can be if she is telling every vendor this information, so wondered if any of you guys had heard anything. ❓
-
Are they going to charge any up front fees? Surely agents cant afford to drop their fees so radically? I wander if the their sales staff are going to go along with this and reduce their highly paid salaries, I guess there will be a large number of unemployed salesmen on the coast soon.
I would be happy to sell my house though with less comission to the agent, as they are not taking away so much of my equity!
-
Yes, drop will be to 2%.
It is one of the Big Boys but am obeying Mark’s rules in that I can’t quote the name.BUT (and its a very big Big Boy but) you will apparently have to pay 600€ + VAT upfront to list your property on their database and they will no longer be working with other agents.
I see a couple of downsides:
1) Unless a client happens to contact them directly your property could sit on the books forever.
2) The sales staff will be earning so low a commission that they’ll do anything to avoid selling a resale and will push their clients into off-plan where commissions will still average 6%.When oh when will these agencies start to realise that vendors are clients too????
Sarah Dodgson
-
-
Sarah,
Interesting post. In the present slow market developers are going to have to drop their prices. One saving they can easily make is to reduce the commissions paid to agents and thus the price paid by the vendor. Will be interesting to see how things develop. However, if this does not happen, agents will only push the higher commission sales. It’s interesting that F…..S have just entered the Spanish market. They must think that the higher margins in Spain will provide a new and lucrative market. Their timing may not be so smart! The more buyers talk about this subject on the forum the more pressure will be brought to bear on the agency world and their unscrupulous practices. The days of being “rolled over” are hopefully seeing an end.
James
-
katy wrote:This may be just a rumour but I have heard that one of the big agents is about to cut its fees to 2% Anyone else heard anything?
Been looking into this…
yes it looks like its true. They will be making it public soon…
I’ve been asked by (them) to not give away… But it appears (to me) its a last ditch effort to save themselves from going under…we will see
-
-
casalaloba wrote:Fuengi,
An agent going under? No tears there then! Couldn’t happen to a nicer bunch of vipers!
James
to be fair to some of them they actually try/are profesional. But like everything a few bad apples (generally ex-time share) ruin everything for everyone.
Same with lawyers. there are plenty that are hard working & trustworthy, but a few SOBs ruin everything
I treat these careers/trades like british fooball supports. Most are decent, but only the yobs get media attention
-
For a long time now, I have been amazed at peoples ignorace when it came to fees. In the UK, you would not dream of paying more than 2%!
In Spain it seems that people were willing to pay (a well known MLS) 7.5%! But this is nothing compared to new build commissions. We would’nt look twice at a development a few years ago who did’nt pay 15%.
Those days have sadly gone… now we are lucky to get 10%!
Why would I break my back for 2% from a re-sale? Many are poorley furnished (if at all) or left in a poor condition!
-
Fuengi, you could be right about it being a last ditch effort, perhaps hoping to generate a bit of cash-flow. (remember Interealty?) They did used to be good at shifting property, they sold 3 for me and the 7.5% was worth it.
Mithras You have a point about the state of a lot of the property, many have been used for rentals and never maintained or updated.
-
Allegedly, Ian Kennedy (former owner) of Interealty, had is heart on “floating” the company in 2002. He made his money in the computer business which was floated in the US some years earlier.
This company still leaves a bitter taste for many. Like me, they are owed monies which will never be paid. Incidentally, their office in San Pedro is for rent… Their office in Marbella is for rent at €10.000 pcm. Any offers??
His yacht had to be moved from Puerto Banus to Sotogrande for various unsubstantiated reasons. I like to think it was because he couldn’t afford it!
-
-
-
So when are they announcing all this?? Am new to this forum, so not sure who you mean, have a few ideas, but there are a few big agents on the coast or at least those that claim to be.
I am interested to see what happens as I am thinking of selling my place, and 2% is interesting to me, as I may have some chance of selling it before next year! The only thing that worries me is the upfront fee, surely ‘no sale no fee’ is fair?
Any clues on the agent so that I can contact them and see whether it is worth me listing my place with them……………
-
-
-
-
Dear All,
Seems like I may be the “Very Big Boy” agent to whom a number of you are referring. However I am completely at a loss to what you guys want?
Do you want to be seen as having been a real force for change, indeed quite a dramatic change in relation to Estate Agents fees on the Costa del Sol?
Which you all actually were.
Or, having been a force for change, had your message and feelings heard, do you now want to kill the very possibility of real change at birth?
Are you able for moment to suspend your belief, just for a moment to consider and imagine that it is possible, just possible; that someone out there with the ability to effect change was actually listening?
Or would you rather continue blogging, without the facts?
I am entirely prepared to enter the debate and blog with you all on the subject of Estate Agent fees, to be open and transparent about our company rates and exactly how they work.
I am concerned that as yet, nobody on the blog has the correct information, seems like the rumour mill has naturally been working overtime. But you all might benefit from having the facts and be able to have a fairer and more informed debate afterwards.
So, do you want to hear it from the horse’s mouth?
-
Dear All,
Seems like I may be the “Very Big Boy” agent to whom a number of you are referring. However I am completely at a loss to what you guys want?
Do you want to be seen as having been a real force for change, indeed quite a dramatic change in relation to Estate Agents fees on the Costa del Sol?
Which you all actually were.
Or, having been a force for change, had your message and feelings heard, do you now want to kill the very possibility of real change at birth?
Are you able for moment to suspend your belief, just for a moment to consider and imagine that it is possible, just possible; that someone out there with the ability to effect change was actually listening?
Or would you rather continue blogging, without the facts?
I am entirely prepared to enter the debate and blog with you all on the subject of Estate Agent fees, to be open and transparent about our company rates and exactly how they work.
I am concerned that as yet, nobody on the blog has the correct information, seems like the rumour mill has naturally been working overtime. But you all might benefit from having the facts and be able to have a fairer and more informed debate afterwards.
So, do you want to hear it from the horse’s mouth?
-
-
-
Hi Katy,
Well my life is now in your hands.
But what part would you like to hear about, or which specific question would you like answered?
It seems a number of assumptions have previously been made, but I don’t want to bore the pants off of people with irrelevant or too much information, so if you ask me a spefic question I will attempt to give you a concise and precise answer.
-
Hi Katy,
Well my life is now in your hands.
But what part would you like to hear about, or which specific question would you like answered?
It seems a number of assumptions have previously been made, but I don’t want to bore the pants off of people with irrelevant or too much information, so if you ask me a spefic question I will attempt to give you a concise and precise answer.
-
Hola Chris,
I do not live on the CDS and do not know of you. However, I understand you are an agent. Your post makes pretty unintelligible reading. How about just stating what commission basis you work on. I have spent my entire life in property and would be intrigued to hear a convincing argument why commissions/mark -ups are so high in the Spanish market. Nothing personal, just curious to get your response.
James
-
Hola Chris,
I do not live on the CDS and do not know of you. However, I understand you are an agent. Your post makes pretty unintelligible reading. How about just stating what commission basis you work on. I have spent my entire life in property and would be intrigued to hear a convincing argument why commissions/mark -ups are so high in the Spanish market. Nothing personal, just curious to get your response.
James
-
Hi Chris
I’m afraid I’ve been smiling throughout this thread re. your company and it’s….sshh…secrets.
First, your company asked that your change in fees be kept confidential, so everyone like Katy is trying to respect that by not mentioning your company.
Then you come on with comments like:
quote
…It seems a number of assumptions have previously been made….
…Or would you rather continue blogging, without the facts?….
….I am concerned that as yet, nobody on the blog has the correct information, seems like the rumour mill has naturally been working overtime…..
unquoteYour company started all the ‘assumptions’ and ‘rumours’ by trying to keep who you are hush-hush. For your clients to be told information about your new fee structure, and then to be told “….but keep it confidential” reminds me of my school days.
In my opinion your two posts are pathetic, and typical of the ‘cocky’ and ‘smug’ attitude of agents I’ve experienced on the CDS.
Why not, in the first place, just come on this forum – leave out your little dialogues (which are patronising to say the least) and just lay your fee structure out on a plate for everyone to see.
Will do wonders for ‘assumptions’ and ‘rumours’. 😉
Barbara
-
Hi Chris
I’m afraid I’ve been smiling throughout this thread re. your company and it’s….sshh…secrets.
First, your company asked that your change in fees be kept confidential, so everyone like Katy is trying to respect that by not mentioning your company.
Then you come on with comments like:
quote
…It seems a number of assumptions have previously been made….
…Or would you rather continue blogging, without the facts?….
….I am concerned that as yet, nobody on the blog has the correct information, seems like the rumour mill has naturally been working overtime…..
unquoteYour company started all the ‘assumptions’ and ‘rumours’ by trying to keep who you are hush-hush. For your clients to be told information about your new fee structure, and then to be told “….but keep it confidential” reminds me of my school days.
In my opinion your two posts are pathetic, and typical of the ‘cocky’ and ‘smug’ attitude of agents I’ve experienced on the CDS.
Why not, in the first place, just come on this forum – leave out your little dialogues (which are patronising to say the least) and just lay your fee structure out on a plate for everyone to see.
Will do wonders for ‘assumptions’ and ‘rumours’. 😉
Barbara
-
Charlie,
Well said hombre! My post was couched in “softer” terms. If this guy Chris is so miffed about posts re his company,fees etc.. why doesn’t he just tell us what his charges are. I just don’t get it. I currently run a lovely little guest house (fully Legal!) from the house I restored and I charge 95 and 105€ per room per night,IVA and brekky included. I worked for years as a commercial property consultant (chartered surveyor) and our fee structure was openly quoted to clients. I don’t hide the room charges for my biz, so why is this guy( and loads of other intermediaries) so shy about quoting his commissions in a transparent manner? I think you,I and many other users of this forum already know the answer …! So come on Senor Chris, how much do you charge for selling a property?
James
-
Charlie,
Well said hombre! My post was couched in “softer” terms. If this guy Chris is so miffed about posts re his company,fees etc.. why doesn’t he just tell us what his charges are. I just don’t get it. I currently run a lovely little guest house (fully Legal!) from the house I restored and I charge 95 and 105€ per room per night,IVA and brekky included. I worked for years as a commercial property consultant (chartered surveyor) and our fee structure was openly quoted to clients. I don’t hide the room charges for my biz, so why is this guy( and loads of other intermediaries) so shy about quoting his commissions in a transparent manner? I think you,I and many other users of this forum already know the answer …! So come on Senor Chris, how much do you charge for selling a property?
James
-
@casalaloba wrote:
Hola Chris,
I do not live on the CDS and do not know of you. However, I understand you are an agent. Your post makes pretty unintelligible reading. How about just stating what commission basis you work on. I have spent my entire life in property and would be intrigued to hear a convincing argument why commissions/mark -ups are so high in the Spanish market. Nothing personal, just curious to get your response.
James
Hi James,
Am sorry my post makes unintelligble reading and I won’t take it personally, perhaps it is because I am new to the world of blogging, I tried it once only years ago. I will try to be specific to your questions:
Officially from tomorrow we will be working on a rate of 2% sales commission, this is further linked to 1% conveyancing fee, which will mean that should you sell your property through our company VIVA Estates (if that is OK to name I had understood that names were not to be mentioned, but believe as long as I am not trying to promote our company this will be acceptable) you will in effect pay a 3% commission in total.
Why split the two, well in order to do the first we want the customer – our vendor – to allow us to do the latter.
The norm here on the Costa del Sol has been for the real estate agent to charge the sales commission and then a lawyer to charge a fee for the conveyancing, however, we believe that having processed more than 8,000 property sales on the Coast over the past years, we will be more than able to handle property conveyancing also.
This then allows us to reduce what would commonly have been a total commission cost of around 10% including IVA (VAT in UK) to 3.4% including IVA. There are a number of ways of looking at this, but it can be seen on the favourable side that we are reducing costs to our vendors of between 60 – 80%.
As to a convincing argument as to why commission fees should be so high in the Spanish market, our argument yesterday was all about marketing costs, the historical competitive environment and our business model within the market.
Today, we have changed our business model, and as you can probably imagine this is a lengthy subject so if you have another question on that or individual areas of it I will happily answer the same.
Chris
-
@casalaloba wrote:
Hola Chris,
I do not live on the CDS and do not know of you. However, I understand you are an agent. Your post makes pretty unintelligible reading. How about just stating what commission basis you work on. I have spent my entire life in property and would be intrigued to hear a convincing argument why commissions/mark -ups are so high in the Spanish market. Nothing personal, just curious to get your response.
James
Hi James,
Am sorry my post makes unintelligble reading and I won’t take it personally, perhaps it is because I am new to the world of blogging, I tried it once only years ago. I will try to be specific to your questions:
Officially from tomorrow we will be working on a rate of 2% sales commission, this is further linked to 1% conveyancing fee, which will mean that should you sell your property through our company VIVA Estates (if that is OK to name I had understood that names were not to be mentioned, but believe as long as I am not trying to promote our company this will be acceptable) you will in effect pay a 3% commission in total.
Why split the two, well in order to do the first we want the customer – our vendor – to allow us to do the latter.
The norm here on the Costa del Sol has been for the real estate agent to charge the sales commission and then a lawyer to charge a fee for the conveyancing, however, we believe that having processed more than 8,000 property sales on the Coast over the past years, we will be more than able to handle property conveyancing also.
This then allows us to reduce what would commonly have been a total commission cost of around 10% including IVA (VAT in UK) to 3.4% including IVA. There are a number of ways of looking at this, but it can be seen on the favourable side that we are reducing costs to our vendors of between 60 – 80%.
As to a convincing argument as to why commission fees should be so high in the Spanish market, our argument yesterday was all about marketing costs, the historical competitive environment and our business model within the market.
Today, we have changed our business model, and as you can probably imagine this is a lengthy subject so if you have another question on that or individual areas of it I will happily answer the same.
Chris
-
-
-
@charlie wrote:
Hi Chris
I’m afraid I’ve been smiling throughout this thread re. your company and it’s….sshh…secrets.
First, your company asked that your change in fees be kept confidential, so everyone like Katy is trying to respect that by not mentioning your company.
Then you come on with comments like:
quote
…It seems a number of assumptions have previously been made….
…Or would you rather continue blogging, without the facts?….
….I am concerned that as yet, nobody on the blog has the correct information, seems like the rumour mill has naturally been working overtime…..
unquoteYour company started all the ‘assumptions’ and ‘rumours’ by trying to keep who you are hush-hush. For your clients to be told information about your new fee structure, and then to be told “….but keep it confidential” reminds me of my school days.
In my opinion your two posts are pathetic, and typical of the ‘cocky’ and ‘smug’ attitude of agents I’ve experienced on the CDS.
Why not, in the first place, just come on this forum – leave out your little dialogues (which are patronising to say the least) and just lay your fee structure out on a plate for everyone to see.
Will do wonders for ‘assumptions’ and ‘rumours’. 😉
Barbara
Hi Barbara,
By the fact that you have been smiling throughout my thread, I suppose I must take it that you believe me to be duplicitous, have a hidden agenda or some other secret goal.
I would ask that you try to be fair here, I have willingly come on to the site, as I understand that we are the agent that is being debated and our move toward a 2% commission rate has engendered this discussion.
Firstly, there have been no …sshh… secrets, I believe that was a misconception, and there has been nothing confidential. How could we go and list a property at 2% and ask that this be kept confidential? Indeed we would like to hope that we may get referral business from our 2% sales commission rate.
What we did do however, was trial the notion of 2% with a limited number of Vendor appointments over an initial period, we made a real and genuine commitment to list those properties at 2%, and in the process tried to understand and ascertain, what did and did not work for our Vendors within our presentation of that 2% plus conveyancing at 1%.
I think it reasonable that we approached 25 vendors firstly and then a subsequent 125 vendors before taking the decision to radically change our business model, but perhaps you think differently.
I would also ask you to keep an open mind here, we have not tried to keep who we are “hush hush” and we certainly did not start all the “assumptions and rumours” we simply went out and listed a number of properties at a new rate, and the rumours went along the Costa del Sol and evidently beyond, at an alarming speed.
This is the truth of the matter, to call me smug, cocky, pathetic and patronising to say the least, is I feel somewhat harsh.
I am attempting to, as you say “lay out on a plate” our position, as it was in some significant measure developed from my having spent a considerable time going through all the Spanish Property Insight forums, over several days a number of months ago.
I think the forum is excellent, I think the views are in the main very valid, and I believe started us on the road of looking to see if we could change our own business model, this we are doing, and this we have confirmed in a mail to all our own staff today.
Our decision for your further information; was reached in full consultation with our entire staff, over the whole of last week, as it affects some 250 people who work with our company. I don’t think you would expect any less of the company and I rather think that from concept to delivery in approx 3 weeks, is something of note, yet also explains why so much comment was made before we were ready to make this official.
I think it natural that some misconceptions or rumours were to abound, I am only here to put them either into perspective or give the correct detail as pertains the rates etc, I leave the rest to you.
Again, if you want to shoot us down in flames before we have a chance to take part in the debate, then I suppose that is the world of the blog and I have to live with it.
Chris
-
@charlie wrote:
Hi Chris
I’m afraid I’ve been smiling throughout this thread re. your company and it’s….sshh…secrets.
First, your company asked that your change in fees be kept confidential, so everyone like Katy is trying to respect that by not mentioning your company.
Then you come on with comments like:
quote
…It seems a number of assumptions have previously been made….
…Or would you rather continue blogging, without the facts?….
….I am concerned that as yet, nobody on the blog has the correct information, seems like the rumour mill has naturally been working overtime…..
unquoteYour company started all the ‘assumptions’ and ‘rumours’ by trying to keep who you are hush-hush. For your clients to be told information about your new fee structure, and then to be told “….but keep it confidential” reminds me of my school days.
In my opinion your two posts are pathetic, and typical of the ‘cocky’ and ‘smug’ attitude of agents I’ve experienced on the CDS.
Why not, in the first place, just come on this forum – leave out your little dialogues (which are patronising to say the least) and just lay your fee structure out on a plate for everyone to see.
Will do wonders for ‘assumptions’ and ‘rumours’. 😉
Barbara
Hi Barbara,
By the fact that you have been smiling throughout my thread, I suppose I must take it that you believe me to be duplicitous, have a hidden agenda or some other secret goal.
I would ask that you try to be fair here, I have willingly come on to the site, as I understand that we are the agent that is being debated and our move toward a 2% commission rate has engendered this discussion.
Firstly, there have been no …sshh… secrets, I believe that was a misconception, and there has been nothing confidential. How could we go and list a property at 2% and ask that this be kept confidential? Indeed we would like to hope that we may get referral business from our 2% sales commission rate.
What we did do however, was trial the notion of 2% with a limited number of Vendor appointments over an initial period, we made a real and genuine commitment to list those properties at 2%, and in the process tried to understand and ascertain, what did and did not work for our Vendors within our presentation of that 2% plus conveyancing at 1%.
I think it reasonable that we approached 25 vendors firstly and then a subsequent 125 vendors before taking the decision to radically change our business model, but perhaps you think differently.
I would also ask you to keep an open mind here, we have not tried to keep who we are “hush hush” and we certainly did not start all the “assumptions and rumours” we simply went out and listed a number of properties at a new rate, and the rumours went along the Costa del Sol and evidently beyond, at an alarming speed.
This is the truth of the matter, to call me smug, cocky, pathetic and patronising to say the least, is I feel somewhat harsh.
I am attempting to, as you say “lay out on a plate” our position, as it was in some significant measure developed from my having spent a considerable time going through all the Spanish Property Insight forums, over several days a number of months ago.
I think the forum is excellent, I think the views are in the main very valid, and I believe started us on the road of looking to see if we could change our own business model, this we are doing, and this we have confirmed in a mail to all our own staff today.
Our decision for your further information; was reached in full consultation with our entire staff, over the whole of last week, as it affects some 250 people who work with our company. I don’t think you would expect any less of the company and I rather think that from concept to delivery in approx 3 weeks, is something of note, yet also explains why so much comment was made before we were ready to make this official.
I think it natural that some misconceptions or rumours were to abound, I am only here to put them either into perspective or give the correct detail as pertains the rates etc, I leave the rest to you.
Again, if you want to shoot us down in flames before we have a chance to take part in the debate, then I suppose that is the world of the blog and I have to live with it.
Chris
-
-
-
Hola Chris,
Another couple of questions. I see you are reducing your commission to 2% + IVA of 16%. This will be payable by the vendor out of the sale price achieved. Will you also be charging the purchaser another 2%+IVA? And, will you quote the selling price inclusive of your commission. I understand that Spanish consumer protection law requires an agent/developer to provide a “Documento Informativo Abreviado” ( a precis of information on the property plus a breakdown of all the costs associated with the sale) to a buyer. I assume you will be complying with this obligation. Look forward to your reply. I have no love for intermediaries in the real estate game here but it let’s hope that your presence in a forum openly hostile to many in the property sector might be an indication that the tide is turning in the favour of the consumer. Vamos a ver!
James
-
Hola Chris,
Another couple of questions. I see you are reducing your commission to 2% + IVA of 16%. This will be payable by the vendor out of the sale price achieved. Will you also be charging the purchaser another 2%+IVA? And, will you quote the selling price inclusive of your commission. I understand that Spanish consumer protection law requires an agent/developer to provide a “Documento Informativo Abreviado” ( a precis of information on the property plus a breakdown of all the costs associated with the sale) to a buyer. I assume you will be complying with this obligation. Look forward to your reply. I have no love for intermediaries in the real estate game here but it let’s hope that your presence in a forum openly hostile to many in the property sector might be an indication that the tide is turning in the favour of the consumer. Vamos a ver!
James
-
-
-
-
-
@casalaloba wrote:
Hola Chris,
Thanks for the reply. Will the conveyancing be carried out by an “in -house” lawyer? What happens if a client wants to employ their own lawyer. Let’s face it, lawyers recommended by the estate agents on the CDS and other Costas hardly have a wonderful reputation!
James
Hi again James,
We do have the services of an “in house lawyer”. Should the customer / vendor wish to proceed with thier own lawyer that is fine by us, however we will charge the full 1%, our being able to sell at a commission of 2% is conditional upon our also offering and delivering the conveyancing at a standard lawyer rate.
Furthermore, our service in conveyancing is not limited to our being the sole agent for the sale, our service will be applicable if the vendor should sell the property privately or through another agent.
I think what might be important to note here, is that using a lawyer for the sale of a property is not as much a requirement, or shall we say as sophisticated a transaction, as that of purchase.
Most sale conveyancing is very simple, and I would venture that were you to ask 100 Spanish nationals if they would use a lawyer for the sale of their property you would not find many in the affirmative.
As for the reputations of lawyers on the coast, to be really fair, there are literally dozens of excellent law firms, and when buying it is absolutely crucial that a buyer takes up truly independent advice and fully avails himself of a law firms services.
Chris
-
@casalaloba wrote:
Hola Chris,
Thanks for the reply. Will the conveyancing be carried out by an “in -house” lawyer? What happens if a client wants to employ their own lawyer. Let’s face it, lawyers recommended by the estate agents on the CDS and other Costas hardly have a wonderful reputation!
James
Hi again James,
We do have the services of an “in house lawyer”. Should the customer / vendor wish to proceed with thier own lawyer that is fine by us, however we will charge the full 1%, our being able to sell at a commission of 2% is conditional upon our also offering and delivering the conveyancing at a standard lawyer rate.
Furthermore, our service in conveyancing is not limited to our being the sole agent for the sale, our service will be applicable if the vendor should sell the property privately or through another agent.
I think what might be important to note here, is that using a lawyer for the sale of a property is not as much a requirement, or shall we say as sophisticated a transaction, as that of purchase.
Most sale conveyancing is very simple, and I would venture that were you to ask 100 Spanish nationals if they would use a lawyer for the sale of their property you would not find many in the affirmative.
As for the reputations of lawyers on the coast, to be really fair, there are literally dozens of excellent law firms, and when buying it is absolutely crucial that a buyer takes up truly independent advice and fully avails himself of a law firms services.
Chris
-
Shame they didn’t offer this reduction whilst my property was on their books. Having had dealings with a broad range of EA’s I would’nt be prepared to pay 1 cent up front either as my experience of the network was that their staff PUSH off plan to prospective buyers, even whilst stood in a clients (sellers) property 👿
-
Shame they didn’t offer this reduction whilst my property was on their books. Having had dealings with a broad range of EA’s I would’nt be prepared to pay 1 cent up front either as my experience of the network was that their staff PUSH off plan to prospective buyers, even whilst stood in a clients (sellers) property 👿
-
@katy wrote:
Can I just ask for a straight answer…is there some money to pay upfront ❓ , I have heard there is. Having successfully sold 3 properties through Viva no complaints but….in the present climate wouldn’t even consider this.
Hi Katy,
Yes, we do ask for a nominal deposit, this is set against the 1% conveyancing fee, for example on a sale of 225,000 euros the fee 1% would be 2,225 euros, we ask for a deposit against that fee of 20% i.e. 225 euros.
We perfectly understand that some vendors may not wish to pay this fee, and they are free to list thier property wherever they choose. What we would advise if asked why the 20% of 1%? Is that we are making a real commitment to sell the property and do the conveyancing, we will be there for the vendor whether we ourselves sell the property or not, we will prepare the file and property for immediate sale, and will be taking on a considerable amount of work and effort on; in listing the property.
One could add that we have all of our extensive marketing material and advertising, which I would say is almost unique in its extent and type on the Costa del Sol, and our vendors can at least say they benefit from exposure, which is perhaps not entirely the case elsewhere. But then that would smack of justification maybe, and quite frankly we don’t believe we need to justify the fee, it is simply a cost of what we do, and again, everyone has freedom to choose. But some considerable number have already weighed up the benefits against the downsides and taken the plunge.
Finally, on this point, we charge a maximum deposit against conveyancing of 1,000 euros so anyone over 500,000 is not charged unduly, everyone below that figure pays appropriately to their property value, and lastly also, I rather think the vendor’s lawyer will ask for an upfront deposit against his costs before undertaking the work involved.
Chris
-
@katy wrote:
Can I just ask for a straight answer…is there some money to pay upfront ❓ , I have heard there is. Having successfully sold 3 properties through Viva no complaints but….in the present climate wouldn’t even consider this.
Hi Katy,
Yes, we do ask for a nominal deposit, this is set against the 1% conveyancing fee, for example on a sale of 225,000 euros the fee 1% would be 2,225 euros, we ask for a deposit against that fee of 20% i.e. 225 euros.
We perfectly understand that some vendors may not wish to pay this fee, and they are free to list thier property wherever they choose. What we would advise if asked why the 20% of 1%? Is that we are making a real commitment to sell the property and do the conveyancing, we will be there for the vendor whether we ourselves sell the property or not, we will prepare the file and property for immediate sale, and will be taking on a considerable amount of work and effort on; in listing the property.
One could add that we have all of our extensive marketing material and advertising, which I would say is almost unique in its extent and type on the Costa del Sol, and our vendors can at least say they benefit from exposure, which is perhaps not entirely the case elsewhere. But then that would smack of justification maybe, and quite frankly we don’t believe we need to justify the fee, it is simply a cost of what we do, and again, everyone has freedom to choose. But some considerable number have already weighed up the benefits against the downsides and taken the plunge.
Finally, on this point, we charge a maximum deposit against conveyancing of 1,000 euros so anyone over 500,000 is not charged unduly, everyone below that figure pays appropriately to their property value, and lastly also, I rather think the vendor’s lawyer will ask for an upfront deposit against his costs before undertaking the work involved.
Chris
-
The big agents have a lot of work to do to regain the confidence of many many people (particularly buyers of offplan properties) who feel they have been taken for a ride and then abandoned by these agents as soon as problems arise. It will take more than a change in commission rates to do this but at least it is a (small) start. If VIVA is changing the way it does business could I make one other suggestion Chris – perhaps you would consider putting a warning notice on (or omitting altogether from your website) developments which have question marks over their legality – Santa Maria Green Hills is advertised in your off-plan section and everyone on this forum is well aware of the problems with it (which I would expect REAs to be aware of also if they are doing their job properly). To be fair to VIVA at least some of the other dubious developments are no longer on your website which is more than can be said for some of the other large agents – one in particular is advertising 2 developments which are actually taped off by police !! I personally would never buy off plan again only resale but even then I would never go near an agent whose website was so obviously misleading.
-
The big agents have a lot of work to do to regain the confidence of many many people (particularly buyers of offplan properties) who feel they have been taken for a ride and then abandoned by these agents as soon as problems arise. It will take more than a change in commission rates to do this but at least it is a (small) start. If VIVA is changing the way it does business could I make one other suggestion Chris – perhaps you would consider putting a warning notice on (or omitting altogether from your website) developments which have question marks over their legality – Santa Maria Green Hills is advertised in your off-plan section and everyone on this forum is well aware of the problems with it (which I would expect REAs to be aware of also if they are doing their job properly). To be fair to VIVA at least some of the other dubious developments are no longer on your website which is more than can be said for some of the other large agents – one in particular is advertising 2 developments which are actually taped off by police !! I personally would never buy off plan again only resale but even then I would never go near an agent whose website was so obviously misleading.
-
@casalaloba wrote:
Hola Chris,
Another couple of questions. I see you are reducing your commission to 2% + IVA of 16%. This will be payable by the vendor out of the sale price achieved. Will you also be charging the purchaser another 2%+IVA? And, will you quote the selling price inclusive of your commission. I understand that Spanish consumer protection law requires an agent/developer to provide a “Documento Informativo Abreviado” ( a precis of information on the property plus a breakdown of all the costs associated with the sale) to a buyer. I assume you will be complying with this obligation. Look forward to your reply. I have no love for intermediaries in the real estate game here but it let’s hope that your presence in a forum openly hostile to many in the property sector might be an indication that the tide is turning in the favour of the consumer. Vamos a ver!
James
Hi James,
We will make no charge whatsoever to the buyer in relation to the sale price. We will charge our commission within the selling price and only to the vendor. we will comply with all government regulations and have always sought to do so.
It is certainly an interesting experience being within the forum, but that’s what forums were for no? Throwing people to the lions! So am going to limp off for the day, and be back tomorrow if anyone has any other questions.
Chris
-
@casalaloba wrote:
Hola Chris,
Another couple of questions. I see you are reducing your commission to 2% + IVA of 16%. This will be payable by the vendor out of the sale price achieved. Will you also be charging the purchaser another 2%+IVA? And, will you quote the selling price inclusive of your commission. I understand that Spanish consumer protection law requires an agent/developer to provide a “Documento Informativo Abreviado” ( a precis of information on the property plus a breakdown of all the costs associated with the sale) to a buyer. I assume you will be complying with this obligation. Look forward to your reply. I have no love for intermediaries in the real estate game here but it let’s hope that your presence in a forum openly hostile to many in the property sector might be an indication that the tide is turning in the favour of the consumer. Vamos a ver!
James
Hi James,
We will make no charge whatsoever to the buyer in relation to the sale price. We will charge our commission within the selling price and only to the vendor. we will comply with all government regulations and have always sought to do so.
It is certainly an interesting experience being within the forum, but that’s what forums were for no? Throwing people to the lions! So am going to limp off for the day, and be back tomorrow if anyone has any other questions.
Chris
-
A few more questions..and doubts…
my daughter has signed up with you to sell a house at 7.5% what happens to these contracts?many properties have been on sale in your magazine for over a year (my daughters for just a year) paying money upfront doesn’t seem a good propostition ie you may just sell it yourself. Can it be as someone has said it is a desperate attempt to generate cash flow. No-one knows the state of the company (remember Interealty?) and it could be money down the drain with the company gone on a few months.
i am sure it is a good marketing ploy but knowing the amount of unsold property on your books I wouldn’t go down that road, a few years ago it would have looked good.
Just an aside to this do you think you could buy your agents some maps or at least try to find the property before they bring clients. Its very annoying when they keep calling to say they ar lost. 🙁
-
A few more questions..and doubts…
my daughter has signed up with you to sell a house at 7.5% what happens to these contracts?many properties have been on sale in your magazine for over a year (my daughters for just a year) paying money upfront doesn’t seem a good propostition ie you may just sell it yourself. Can it be as someone has said it is a desperate attempt to generate cash flow. No-one knows the state of the company (remember Interealty?) and it could be money down the drain with the company gone on a few months.
i am sure it is a good marketing ploy but knowing the amount of unsold property on your books I wouldn’t go down that road, a few years ago it would have looked good.
Just an aside to this do you think you could buy your agents some maps or at least try to find the property before they bring clients. Its very annoying when they keep calling to say they ar lost. 🙁
-
Hola Chris,
Still not 100% clear.If I make an offer to buy a property through your agency and my lawyer prepares the private contract between me and the vendor, will the price still include the 1% you charge for legal fees?
Also, will your firm clearly state the amount included within the price for fees? For example: If I buy a property for 200,000€ the commission and legal fee included in the total sale price will be 6725.94€ inc IVA. Thus the bricks and mortar will be 193,274.06€ and the charges 6725.94€. The notario etc. are of course in addition to this.
Are you still going to use “celebrity” endorsement to promote your company? Speaking personally, nothing makes me run faster than the thought that a sports/soap/big brother etc….personality recommends
a particular agency!James
-
Hola Chris,
Still not 100% clear.If I make an offer to buy a property through your agency and my lawyer prepares the private contract between me and the vendor, will the price still include the 1% you charge for legal fees?
Also, will your firm clearly state the amount included within the price for fees? For example: If I buy a property for 200,000€ the commission and legal fee included in the total sale price will be 6725.94€ inc IVA. Thus the bricks and mortar will be 193,274.06€ and the charges 6725.94€. The notario etc. are of course in addition to this.
Are you still going to use “celebrity” endorsement to promote your company? Speaking personally, nothing makes me run faster than the thought that a sports/soap/big brother etc….personality recommends
a particular agency!James
-
Welcome to the Forum Chris. Always glad to read your comments.
I can’t help but say that I’m fascinated by your proposal! This post is in no way to be perceived as critical…I’m simply curious as to the long-term viability of the scheme.
Why don’t you also fess up to how your salespeople are now going to be recompensed? Have never liked rumours myself, prefer facts every time.
Do you not think that there is a potential conflict of interest to the in-house conveyancing? In the past I have met several lawyers who have confessed to having been pushed by an agent into closing the deal at any price…and surely if they’re earning fees in-house now then the pressure to complete wil be on even more?
Will the in-house lawyers do a check on the property as part of the upfront 20% of 1% fee? Do you think this will finally stop the Viva/MLS database from being clogged up with illegally built, illegally extended, size mis-declared properties?…or do you think that if the sales staff are incentivised to get cash in from the up-front fee that they’ll disregard what they know to be a crap unsellable property just to get paid at the end of the month?
With the (apparent, correct me if I’m wrong) maximum claimable commission on an off-plan sale of 5% vs a resale at 2% surely this will drive your salespeople back into the fraught with problems off-plan market?
Is it also correct that even if the development pays over 5% then your sales staff will only be able to claim a maximum commission paid on 5% and Viva takes the rest?
Are you suddenly going to hire a bunch of new salespeople/listers who speak more languages? Or are you solely concentrating on the english-speaking resale market? Most Spaniards I know would laugh if you asked them for an upfront fee (correct me if I’m wrong Drakan, Cesar, Iñigo, etc.) and the sales I’ve ever done with Spanish vendors have usually been so clear cut that they haven’t even used a lawyer so why would they “waste” 1%?
Hmmm. I just can’t see vendors lining up to give you guys money for the privilege of being listed with Viva. Upfront listing fee with a guarantee of a refund if not sold within one year…now we’d be talking! Good luck to you for trying.
Its a Bank Holiday today but here’s hoping you’re still beavering away in the office and find the time to reply. Shout if you want a coffee.
Sarah Dodgson
-
Welcome to the Forum Chris. Always glad to read your comments.
I can’t help but say that I’m fascinated by your proposal! This post is in no way to be perceived as critical…I’m simply curious as to the long-term viability of the scheme.
Why don’t you also fess up to how your salespeople are now going to be recompensed? Have never liked rumours myself, prefer facts every time.
Do you not think that there is a potential conflict of interest to the in-house conveyancing? In the past I have met several lawyers who have confessed to having been pushed by an agent into closing the deal at any price…and surely if they’re earning fees in-house now then the pressure to complete wil be on even more?
Will the in-house lawyers do a check on the property as part of the upfront 20% of 1% fee? Do you think this will finally stop the Viva/MLS database from being clogged up with illegally built, illegally extended, size mis-declared properties?…or do you think that if the sales staff are incentivised to get cash in from the up-front fee that they’ll disregard what they know to be a crap unsellable property just to get paid at the end of the month?
With the (apparent, correct me if I’m wrong) maximum claimable commission on an off-plan sale of 5% vs a resale at 2% surely this will drive your salespeople back into the fraught with problems off-plan market?
Is it also correct that even if the development pays over 5% then your sales staff will only be able to claim a maximum commission paid on 5% and Viva takes the rest?
Are you suddenly going to hire a bunch of new salespeople/listers who speak more languages? Or are you solely concentrating on the english-speaking resale market? Most Spaniards I know would laugh if you asked them for an upfront fee (correct me if I’m wrong Drakan, Cesar, Iñigo, etc.) and the sales I’ve ever done with Spanish vendors have usually been so clear cut that they haven’t even used a lawyer so why would they “waste” 1%?
Hmmm. I just can’t see vendors lining up to give you guys money for the privilege of being listed with Viva. Upfront listing fee with a guarantee of a refund if not sold within one year…now we’d be talking! Good luck to you for trying.
Its a Bank Holiday today but here’s hoping you’re still beavering away in the office and find the time to reply. Shout if you want a coffee.
Sarah Dodgson
-
Yes, we do ask for a nominal deposit, this is set against the 1% conveyancing fee, for example on a sale of 225,000 euros the fee 1% would be 2,225 euros, we ask for a deposit against that fee of 20% i.e. 225 euros.
……Correction Chris. 20% of 2,250 Euros makes a deposit of 450 Euros. Not 225.
Katerina
-
Yes, we do ask for a nominal deposit, this is set against the 1% conveyancing fee, for example on a sale of 225,000 euros the fee 1% would be 2,225 euros, we ask for a deposit against that fee of 20% i.e. 225 euros.
……Correction Chris. 20% of 2,250 Euros makes a deposit of 450 Euros. Not 225.
Katerina
-
@Mary wrote:
The big agents have a lot of work to do to regain the confidence of many many people (particularly buyers of offplan properties) who feel they have been taken for a ride and then abandoned by these agents as soon as problems arise. It will take more than a change in commission rates to do this but at least it is a (small) start. If VIVA is changing the way it does business could I make one other suggestion Chris – perhaps you would consider putting a warning notice on (or omitting altogether from your website) developments which have question marks over their legality – Santa Maria Green Hills is advertised in your off-plan section and everyone on this forum is well aware of the problems with it (which I would expect REAs to be aware of also if they are doing their job properly). To be fair to VIVA at least some of the other dubious developments are no longer on your website which is more than can be said for some of the other large agents – one in particular is advertising 2 developments which are actually taped off by police !! I personally would never buy off plan again only resale but even then I would never go near an agent whose website was so obviously misleading.
Dear Mary,
I have given instructions today to remove Santa Maria Green Hills from the development list on our website, although I am advised that certain phases are entirely trouble free in this project and do not wish to demean the project in any manner.
As with a number of other projects it is to be hoped that any problems they may have will be resolved shortly.
Chris
-
@Mary wrote:
The big agents have a lot of work to do to regain the confidence of many many people (particularly buyers of offplan properties) who feel they have been taken for a ride and then abandoned by these agents as soon as problems arise. It will take more than a change in commission rates to do this but at least it is a (small) start. If VIVA is changing the way it does business could I make one other suggestion Chris – perhaps you would consider putting a warning notice on (or omitting altogether from your website) developments which have question marks over their legality – Santa Maria Green Hills is advertised in your off-plan section and everyone on this forum is well aware of the problems with it (which I would expect REAs to be aware of also if they are doing their job properly). To be fair to VIVA at least some of the other dubious developments are no longer on your website which is more than can be said for some of the other large agents – one in particular is advertising 2 developments which are actually taped off by police !! I personally would never buy off plan again only resale but even then I would never go near an agent whose website was so obviously misleading.
Dear Mary,
I have given instructions today to remove Santa Maria Green Hills from the development list on our website, although I am advised that certain phases are entirely trouble free in this project and do not wish to demean the project in any manner.
As with a number of other projects it is to be hoped that any problems they may have will be resolved shortly.
Chris
-
katy wrote:A few more questions..and doubts…
my daughter has signed up with you to sell a house at 7.5% what happens to these contracts?Dear Katy,
We start contacting Vendors today, we will be advising them that they have the option to be unlisted, or to proceed at our new rate and with our conveyancing deposit.
We have a lot of phone calls to make, some 3,500 actually so it may take some time for your daughter to be called.
We will not continue to keep properties on our books at 7.5% once Vendors have been advised of our new rates, this would be entirely unfair to any Vendor at 2%, would set a double standard and simply would not work in favour of the buyer either.
Chris
-
katy wrote:A few more questions..and doubts…
my daughter has signed up with you to sell a house at 7.5% what happens to these contracts?Dear Katy,
We start contacting Vendors today, we will be advising them that they have the option to be unlisted, or to proceed at our new rate and with our conveyancing deposit.
We have a lot of phone calls to make, some 3,500 actually so it may take some time for your daughter to be called.
We will not continue to keep properties on our books at 7.5% once Vendors have been advised of our new rates, this would be entirely unfair to any Vendor at 2%, would set a double standard and simply would not work in favour of the buyer either.
Chris
-
@katy wrote:
many properties have been on sale in your magazine for over a year (my daughters for just a year) paying money upfront doesn’t seem a good propostition ie you may just sell it yourself.
🙁
Dear Katy,
To the second part of your earlier questions:
It may well be true that some properties are on our books for over a year, some properties can take 18 months plus to sell.
But there is an old saying: “Everything sells at the right price…”
What we hope in the future, is that we will have properties keenly priced to sell, with a great offering to the buyer in that we – the agent – are not stealing the equity off the vendor and or the buyer.
If you buy one of our listed properties, you will be buying at a price that does not see 10%+ going to the agent, we hope our vendors will be motivated to price to sell. We believe our properties will move quicker than the market norm, as buyers realise that we are no longer a barrier to the sale because of the equity that would be taken from our being an intermediary.
I hope your daughter has been happy however that we have continued to market and promote her property, and would imagine that she realises this in itself does not come without signifcant cost to us.
As for providing maps, if there were decent or reasonable maps, believe me we would have them, but they just don’t exist in a a format that would be viable.
Chris
-
@katy wrote:
many properties have been on sale in your magazine for over a year (my daughters for just a year) paying money upfront doesn’t seem a good propostition ie you may just sell it yourself.
🙁
Dear Katy,
To the second part of your earlier questions:
It may well be true that some properties are on our books for over a year, some properties can take 18 months plus to sell.
But there is an old saying: “Everything sells at the right price…”
What we hope in the future, is that we will have properties keenly priced to sell, with a great offering to the buyer in that we – the agent – are not stealing the equity off the vendor and or the buyer.
If you buy one of our listed properties, you will be buying at a price that does not see 10%+ going to the agent, we hope our vendors will be motivated to price to sell. We believe our properties will move quicker than the market norm, as buyers realise that we are no longer a barrier to the sale because of the equity that would be taken from our being an intermediary.
I hope your daughter has been happy however that we have continued to market and promote her property, and would imagine that she realises this in itself does not come without signifcant cost to us.
As for providing maps, if there were decent or reasonable maps, believe me we would have them, but they just don’t exist in a a format that would be viable.
Chris
-
@katy wrote:
Can it be as someone has said it is a desperate attempt to generate cash flow. No-one knows the state of the company (remember Interealty?) and it could be money down the drain with the company gone on a few months.
🙁Dear Katy,
To the third and final element of your questions:
I do recall that someone speculated that this could be a desperate attempt to generate cashflow, however that notion whilst entirely understandable as an initial thought or query, does not really stand up to close scrutiny.
Our entire company accounts are a matter of public record across all the years of our trading, and our accounts have been audited annually by KPMG for at least the last six years, and I would venture that we have exceptional business to business relationships and an exemplary record of paying all our staff and suppliers on time, every time.
The deposit monies we receive are not in themselves substantial against the running costs of an enterprise such as ours, they actually represent a commitment on behalf of the vendor to list with ourselves and to allow us the opportunity to do their conveyancing.
Had we the need to generate cashflow, we would hardly be cutting commission rates from 7.5% to 2%, this would be illogical, we are talking about a 1/5 of 1%, it really means nothing in terms of cashflow or within the grand scheme of things. It really is about commitment and involvement in a different dynamic and changing model.
I do sadly remember Interealty, I cannot comment on their demise, except to say that, no part of their history is a part of ours, take a look at all of our promotion – which is now going to expand apace – our offices, our infrastructure and our relationships, and if necessary our accounts.
Then if nothing else, take the cost and apply it to the promotional and advertising benefits that everyone listing with our company has, and work out then if it is money down the drain.
We are not in business to take several hundred euros and run, as I said it was an entirely understandable response, but the basic math just does not equate to a reasonable scenario.
Chris
-
@katy wrote:
Can it be as someone has said it is a desperate attempt to generate cash flow. No-one knows the state of the company (remember Interealty?) and it could be money down the drain with the company gone on a few months.
🙁Dear Katy,
To the third and final element of your questions:
I do recall that someone speculated that this could be a desperate attempt to generate cashflow, however that notion whilst entirely understandable as an initial thought or query, does not really stand up to close scrutiny.
Our entire company accounts are a matter of public record across all the years of our trading, and our accounts have been audited annually by KPMG for at least the last six years, and I would venture that we have exceptional business to business relationships and an exemplary record of paying all our staff and suppliers on time, every time.
The deposit monies we receive are not in themselves substantial against the running costs of an enterprise such as ours, they actually represent a commitment on behalf of the vendor to list with ourselves and to allow us the opportunity to do their conveyancing.
Had we the need to generate cashflow, we would hardly be cutting commission rates from 7.5% to 2%, this would be illogical, we are talking about a 1/5 of 1%, it really means nothing in terms of cashflow or within the grand scheme of things. It really is about commitment and involvement in a different dynamic and changing model.
I do sadly remember Interealty, I cannot comment on their demise, except to say that, no part of their history is a part of ours, take a look at all of our promotion – which is now going to expand apace – our offices, our infrastructure and our relationships, and if necessary our accounts.
Then if nothing else, take the cost and apply it to the promotional and advertising benefits that everyone listing with our company has, and work out then if it is money down the drain.
We are not in business to take several hundred euros and run, as I said it was an entirely understandable response, but the basic math just does not equate to a reasonable scenario.
Chris
-
@Chris McCarthy wrote:
Dear Mary,
I have given instructions today to remove Santa Maria Green Hills from the development list on our website, although I am advised that certain phases are entirely trouble free in this project and do not wish to demean the project in any manner.
Chris
Dear Chris
Am afraid you were advised badly (possibly by the developer?).
Just so you are aware re. Green Hills, the questions and answers below were between ourselves and the ‘new’ Town Planning Department in Marbella just last week. It confirms what we have suspected for nearly a year now., but the developer has kept insisting that nothing is wrong and that they even have a LFO through Administrative Silence.Our questions to them were:
1. We would like to know what is the current status re. the Building License and the LFO of Santa Maria Green Hills?Answer:
The suspension order issued by the Supreme Tribunal of Justice of the Junta of Anadalusia (TSJA), cancels (repeals), or better, suspends the Building Licence and that stops them from being issued with an LFO.2. We would also like to know what was the real reason behind the judicial suspension of works?
Answer:
The suspension was due to legal action (denuncia) taken by the ‘Ecologists in Action’ and the Junta de Andalucia, because the works (buildings) were not according to the Town Planning Legislation in force. The ‘qualification’ of the land impeded the execution of such works.You are probably wondering why did the Town Hall then grant this Building License? A quick response to that is that today those who granted it are in jail. Although, this is of little help to you all.
There were just two ‘phases’ to Green Hills. Upper level blocks and lower level blocks. The upper level never got built, something that the developer failed to inform most of the purchasers of for over two years, including us.
The above answers refer to the now-built lower level.Hope this makes you feel a bit better re. removing Green Hills from your website.
Just shows how informative this forum can be. 😉P.S. I have to add a footnote here re. your Company.
We have just recalled that in the Summer of 2003, on our property-buying venture, we actually had a ‘day out’ viewing with one of your young salesmen. Unfortunately we can’t remember his name.
He was excellent, showed us four developments that were exactly our spec., he was friendly without being overboard, knowledgable re. all our questions, and not ‘pushy’.
I personally could have spent a whole week with him!On our return to England, we telephoned him and informed him that we had decided on a development (Green Hills 🙁 ) that we had seen with another agent. He voiced his disappointment as he explained that your company also had this development, but nevertheless – in grand cavelier-style – wished us well.
A few weeks later, he telephoned us. He asked us whether we had heard that Green Hills’ own 9 hole golf course was not going to be built, permission had been withdrawn. We were shocked as our agent had not told us this news. I asked him what was VE advising their purchasers to do in the circumstances, and he replied that you were advising to withdraw.
He did not try to persuade us either way (he could have done to get us back in with VE), he just seemed genuinely concerned that we knew this new development.
Looking back, not only was he an all-round impressive young man, we just wish we had taken his advice!!
So there, Chris – on this forum, we may ‘throw you to the lions’ sometimes, but we do throw in a few large bones from time to time (when praise is due….).But I have to ask the question: Why is it your company was still advertising this development, despite suspension of building works going back as far as October 2003? The withdrawal of permission re. the golf course in the Summer that year should have rung some alarm bells with you – especially bearing in mind you were in a good position to be fully aware of the Mayor Gil scandal. Apparantly everybody in the ‘property game’ knew what was ‘in the air’ that Summer – except us purchasers!
Barbara
-
@Chris McCarthy wrote:
Dear Mary,
I have given instructions today to remove Santa Maria Green Hills from the development list on our website, although I am advised that certain phases are entirely trouble free in this project and do not wish to demean the project in any manner.
Chris
Dear Chris
Am afraid you were advised badly (possibly by the developer?).
Just so you are aware re. Green Hills, the questions and answers below were between ourselves and the ‘new’ Town Planning Department in Marbella just last week. It confirms what we have suspected for nearly a year now., but the developer has kept insisting that nothing is wrong and that they even have a LFO through Administrative Silence.Our questions to them were:
1. We would like to know what is the current status re. the Building License and the LFO of Santa Maria Green Hills?Answer:
The suspension order issued by the Supreme Tribunal of Justice of the Junta of Anadalusia (TSJA), cancels (repeals), or better, suspends the Building Licence and that stops them from being issued with an LFO.2. We would also like to know what was the real reason behind the judicial suspension of works?
Answer:
The suspension was due to legal action (denuncia) taken by the ‘Ecologists in Action’ and the Junta de Andalucia, because the works (buildings) were not according to the Town Planning Legislation in force. The ‘qualification’ of the land impeded the execution of such works.You are probably wondering why did the Town Hall then grant this Building License? A quick response to that is that today those who granted it are in jail. Although, this is of little help to you all.
There were just two ‘phases’ to Green Hills. Upper level blocks and lower level blocks. The upper level never got built, something that the developer failed to inform most of the purchasers of for over two years, including us.
The above answers refer to the now-built lower level.Hope this makes you feel a bit better re. removing Green Hills from your website.
Just shows how informative this forum can be. 😉P.S. I have to add a footnote here re. your Company.
We have just recalled that in the Summer of 2003, on our property-buying venture, we actually had a ‘day out’ viewing with one of your young salesmen. Unfortunately we can’t remember his name.
He was excellent, showed us four developments that were exactly our spec., he was friendly without being overboard, knowledgable re. all our questions, and not ‘pushy’.
I personally could have spent a whole week with him!On our return to England, we telephoned him and informed him that we had decided on a development (Green Hills 🙁 ) that we had seen with another agent. He voiced his disappointment as he explained that your company also had this development, but nevertheless – in grand cavelier-style – wished us well.
A few weeks later, he telephoned us. He asked us whether we had heard that Green Hills’ own 9 hole golf course was not going to be built, permission had been withdrawn. We were shocked as our agent had not told us this news. I asked him what was VE advising their purchasers to do in the circumstances, and he replied that you were advising to withdraw.
He did not try to persuade us either way (he could have done to get us back in with VE), he just seemed genuinely concerned that we knew this new development.
Looking back, not only was he an all-round impressive young man, we just wish we had taken his advice!!
So there, Chris – on this forum, we may ‘throw you to the lions’ sometimes, but we do throw in a few large bones from time to time (when praise is due….).But I have to ask the question: Why is it your company was still advertising this development, despite suspension of building works going back as far as October 2003? The withdrawal of permission re. the golf course in the Summer that year should have rung some alarm bells with you – especially bearing in mind you were in a good position to be fully aware of the Mayor Gil scandal. Apparantly everybody in the ‘property game’ knew what was ‘in the air’ that Summer – except us purchasers!
Barbara
-
@casalaloba wrote:
Hola Chris,
Still not 100% clear.If I make an offer to buy a property through your agency and my lawyer prepares the private contract between me and the vendor, will the price still include the 1% you charge for legal fees?
Also, will your firm clearly state the amount included within the price for fees? For example: If I buy a property for 200,000€ the commission and legal fee included in the total sale price will be 6725.94€ inc IVA. Thus the bricks and mortar will be 193,274.06€ and the charges 6725.94€. The notario etc. are of course in addition to this.
Are you still going to use “celebrity” endorsement to promote your company? Speaking personally, nothing makes me run faster than the thought that a sports/soap/big brother etc….personality recommends
a particular agency!James
Hi James,
Our fees, are our fees to the vendor, your lawyer and his contract are your – being the buyers – responsibility. We will make clear what our fees and charges are, and under normal conditions these will be represented in a payment made to ourselves by your lawyer as part of the contract.
I think in the example you use above the total fee will be 6,960 euros though. And yes we fully intend to use celebrity endorsement, like a number of marketing issues, it works for some and not for others, but one hopes that people may consider the whole picture and not just a part.
Chris
-
@casalaloba wrote:
Hola Chris,
Still not 100% clear.If I make an offer to buy a property through your agency and my lawyer prepares the private contract between me and the vendor, will the price still include the 1% you charge for legal fees?
Also, will your firm clearly state the amount included within the price for fees? For example: If I buy a property for 200,000€ the commission and legal fee included in the total sale price will be 6725.94€ inc IVA. Thus the bricks and mortar will be 193,274.06€ and the charges 6725.94€. The notario etc. are of course in addition to this.
Are you still going to use “celebrity” endorsement to promote your company? Speaking personally, nothing makes me run faster than the thought that a sports/soap/big brother etc….personality recommends
a particular agency!James
Hi James,
Our fees, are our fees to the vendor, your lawyer and his contract are your – being the buyers – responsibility. We will make clear what our fees and charges are, and under normal conditions these will be represented in a payment made to ourselves by your lawyer as part of the contract.
I think in the example you use above the total fee will be 6,960 euros though. And yes we fully intend to use celebrity endorsement, like a number of marketing issues, it works for some and not for others, but one hopes that people may consider the whole picture and not just a part.
Chris
-
Hola again Chris,
Thanks for reply. My maths is spot on. If a property is advertised at 200,000€, all costs included, the net property cost would be as quoted in my message. Your calculation is based on the premise that the price for the property is 200,000 EXCLUDING YOUR COMMISSION/FEES. Hence my original post. Will you be advertising properties net or inclusive of your firms costs of 3.48% (IVA inc)? A wise purchaser will want to know how much of their total investment in a property here relates to commissions and all other costs. That approach concentrates your mind on the price you are paying for the property element. As the purchaser provides the money for your commission, why do you not have a separate fee contract which will reduce, quite legally, the amount in the escritura and thus all the percentage based costs for the notario,taxes etc. This would in no way effect the calculation for CGT as the vendor can reduce the gain by the amount billed by your company.
As for “celebrities” I just do not get it. They must carry a cost for you. Why would anyone be influenced to buy a property because some “known face” says you are good guys. In my experience what best sells property is the quality of the product itself, the transparency of the buying process and the professionalism of the intermediaries. Sportsmen, soap stars etc all have their just place in life….on the sports field,on the tele etc. Each one to their speciality!!! From my viewpoint I would never use an agency that carried a celebrity endorsement. But I would consider
an agency whose services were founded on professionalism, knowledge,
transparency etc…It would be a breath of fresh air if your participation in this forum helps you to change the face of agency practices in much of Spain. I congratulate you on listening and accepting the barbs. But I’ll reserve final judgement for the moment!
Saludos,
James
-
Hola again Chris,
Thanks for reply. My maths is spot on. If a property is advertised at 200,000€, all costs included, the net property cost would be as quoted in my message. Your calculation is based on the premise that the price for the property is 200,000 EXCLUDING YOUR COMMISSION/FEES. Hence my original post. Will you be advertising properties net or inclusive of your firms costs of 3.48% (IVA inc)? A wise purchaser will want to know how much of their total investment in a property here relates to commissions and all other costs. That approach concentrates your mind on the price you are paying for the property element. As the purchaser provides the money for your commission, why do you not have a separate fee contract which will reduce, quite legally, the amount in the escritura and thus all the percentage based costs for the notario,taxes etc. This would in no way effect the calculation for CGT as the vendor can reduce the gain by the amount billed by your company.
As for “celebrities” I just do not get it. They must carry a cost for you. Why would anyone be influenced to buy a property because some “known face” says you are good guys. In my experience what best sells property is the quality of the product itself, the transparency of the buying process and the professionalism of the intermediaries. Sportsmen, soap stars etc all have their just place in life….on the sports field,on the tele etc. Each one to their speciality!!! From my viewpoint I would never use an agency that carried a celebrity endorsement. But I would consider
an agency whose services were founded on professionalism, knowledge,
transparency etc…It would be a breath of fresh air if your participation in this forum helps you to change the face of agency practices in much of Spain. I congratulate you on listening and accepting the barbs. But I’ll reserve final judgement for the moment!
Saludos,
James
-
@sdodgson wrote:
Welcome to the Forum Chris. Always glad to read your comments.
I can’t help but say that I’m fascinated by your proposal! This post is in no way to be perceived as critical…I’m simply curious as to the long-term viability of the scheme.
Why don’t you also fess up to how your salespeople are now going to be recompensed? Have never liked rumours myself, prefer facts every time.
Do you not think that there is a potential conflict of interest to the in-house conveyancing? In the past I have met several lawyers who have confessed to having been pushed by an agent into closing the deal at any price…and surely if they’re earning fees in-house now then the pressure to complete wil be on even more?
Will the in-house lawyers do a check on the property as part of the upfront 20% of 1% fee? Do you think this will finally stop the Viva/MLS database from being clogged up with illegally built, illegally extended, size mis-declared properties?…or do you think that if the sales staff are incentivised to get cash in from the up-front fee that they’ll disregard what they know to be a crap unsellable property just to get paid at the end of the month?
With the (apparent, correct me if I’m wrong) maximum claimable commission on an off-plan sale of 5% vs a resale at 2% surely this will drive your salespeople back into the fraught with problems off-plan market?
Is it also correct that even if the development pays over 5% then your sales staff will only be able to claim a maximum commission paid on 5% and Viva takes the rest?
Are you suddenly going to hire a bunch of new salespeople/listers who speak more languages? Or are you solely concentrating on the english-speaking resale market? Most Spaniards I know would laugh if you asked them for an upfront fee (correct me if I’m wrong Drakan, Cesar, Iñigo, etc.) and the sales I’ve ever done with Spanish vendors have usually been so clear cut that they haven’t even used a lawyer so why would they “waste” 1%?
Hmmm. I just can’t see vendors lining up to give you guys money for the privilege of being listed with Viva. Upfront listing fee with a guarantee of a refund if not sold within one year…now we’d be talking! Good luck to you for trying.
Its a Bank Holiday today but here’s hoping you’re still beavering away in the office and find the time to reply. Shout if you want a coffee.
Sarah Dodgson
Hi Sarah,
Thanks for the welcome, and am always up for a cup of coffee.
I hope everyone will forgive me if this particular post is a bit longer than others, as there are a number of questions and issues here, which I will again endeavour to answer clearly and openly.
As to the long term viability of the scheme, it seems strange that you would be concerned about this, when to my knowledge real estate agents in the UK run their business at an average of somewhere around 1.5% sales commission. Are their businesses not only viable but profitable?
As to fessing up to what we will pay our property negotiators – our preferred term to salespeople – we will again be entirely open about the facts rather than allow rumour to abound.
We are moving to a system common in the UK, whereby we will have a fixed salary based package, with company car and bonuses for on target performance. We believe this is a more mature market today, we believe that our staff are looking for stability and a real future / career and appreciate the approach we are taking into providing this for them.
As to lawyers and pressure, no lawyer should be pressured by an agent to complete on a sale at any price, and no lawyer from outside our company will be receiving any fee from ourselves with respect to any sale. We have never, as I think you know, ever paid any lawyer any fee whatsover in respect of sales, nor have we ever received a fee from any lawyer at any time. They should solely act in the interests of their client the buyer, whom is also a client of ours again for the future we hope.
The buyers lawyer is responsible for any and all checks on the property for sale, again that is independent of any involvment of ourselves. We are no longer a member of the MLS system, and we would certainly not want to clog up our own database with illegally built or mis declared properties, and any half decent lawyer will not allow their clients to buy any such property.
Our property negotiators will receive no part or commission of any conveyancing deposit or fee, and actually I don’t see that any property is per se “crap or unsaleable”, someone owns it, therefore someone must have originally bought it, and as I said in an earlier post – everything sells at the right price – and lets not forget it is someone’s home!
Once again, this exercise is not part of a grab the money and run scenario, it just would not work that way, even in the short term.
As for developments, our property negotiators will be paid exactly the same as if they were selling a resale property, no difference at all. And as for the problems with the off plan market, I think we are all aware that there are many good and viable developers building good and quality projects along the entire coast that are not affected by the problems you mention.
And I genuinely don’t believe that we are in the business of literally pushing people into making these decisions, you may not be aware however, or perhaps be pleased to know, that the vast majority of buyers with our company actually purchase resale properties.
I would also venture that today’s buyer is far more informed, and better able to make up their own minds about the end use and decision process of their purchase. I don’t want to sound trite, but our job is simply to show what is available and leave the buyer to decide.
As for personnel who speak more languages, again you may not be aware that in a clear majority we have far more non English staff than English only, I think uniquely we have a broad spread of all European’s and a solid number of Spanish nationals. Our board of directors has only myself as an English person on it for example.
As for Spanish vendors, that again is for them to decide, but they may take the view that the total amount payable is 3%, I wonder what the mentioned gentlemen might think of that against the traditional Spanish agency fees? Higher or lower? Again, what promotion will the Spanish vendor now receive within that total of 3%? I am not seeking to justify our position here, simply to clarify.
Finally, this is not an upfront listing fee, it is a deposit against your conveyancing, which we are committed to do for you the vendor upon the sale of your property, whether privately, through another agent or with ourselves. Why would that be refunded? You simply should not pay the fee or enter into the arrangement unless you are convinced you are going to sell your property in the future.
It is indeed a bank holiday, and as ever we don’t take them here, we all keep our offices open and stay beavering away!
I am so sorry this post was so long, I did not know how to make it shorter. Looking foward to the coffee.
Chris
-
@sdodgson wrote:
Welcome to the Forum Chris. Always glad to read your comments.
I can’t help but say that I’m fascinated by your proposal! This post is in no way to be perceived as critical…I’m simply curious as to the long-term viability of the scheme.
Why don’t you also fess up to how your salespeople are now going to be recompensed? Have never liked rumours myself, prefer facts every time.
Do you not think that there is a potential conflict of interest to the in-house conveyancing? In the past I have met several lawyers who have confessed to having been pushed by an agent into closing the deal at any price…and surely if they’re earning fees in-house now then the pressure to complete wil be on even more?
Will the in-house lawyers do a check on the property as part of the upfront 20% of 1% fee? Do you think this will finally stop the Viva/MLS database from being clogged up with illegally built, illegally extended, size mis-declared properties?…or do you think that if the sales staff are incentivised to get cash in from the up-front fee that they’ll disregard what they know to be a crap unsellable property just to get paid at the end of the month?
With the (apparent, correct me if I’m wrong) maximum claimable commission on an off-plan sale of 5% vs a resale at 2% surely this will drive your salespeople back into the fraught with problems off-plan market?
Is it also correct that even if the development pays over 5% then your sales staff will only be able to claim a maximum commission paid on 5% and Viva takes the rest?
Are you suddenly going to hire a bunch of new salespeople/listers who speak more languages? Or are you solely concentrating on the english-speaking resale market? Most Spaniards I know would laugh if you asked them for an upfront fee (correct me if I’m wrong Drakan, Cesar, Iñigo, etc.) and the sales I’ve ever done with Spanish vendors have usually been so clear cut that they haven’t even used a lawyer so why would they “waste” 1%?
Hmmm. I just can’t see vendors lining up to give you guys money for the privilege of being listed with Viva. Upfront listing fee with a guarantee of a refund if not sold within one year…now we’d be talking! Good luck to you for trying.
Its a Bank Holiday today but here’s hoping you’re still beavering away in the office and find the time to reply. Shout if you want a coffee.
Sarah Dodgson
Hi Sarah,
Thanks for the welcome, and am always up for a cup of coffee.
I hope everyone will forgive me if this particular post is a bit longer than others, as there are a number of questions and issues here, which I will again endeavour to answer clearly and openly.
As to the long term viability of the scheme, it seems strange that you would be concerned about this, when to my knowledge real estate agents in the UK run their business at an average of somewhere around 1.5% sales commission. Are their businesses not only viable but profitable?
As to fessing up to what we will pay our property negotiators – our preferred term to salespeople – we will again be entirely open about the facts rather than allow rumour to abound.
We are moving to a system common in the UK, whereby we will have a fixed salary based package, with company car and bonuses for on target performance. We believe this is a more mature market today, we believe that our staff are looking for stability and a real future / career and appreciate the approach we are taking into providing this for them.
As to lawyers and pressure, no lawyer should be pressured by an agent to complete on a sale at any price, and no lawyer from outside our company will be receiving any fee from ourselves with respect to any sale. We have never, as I think you know, ever paid any lawyer any fee whatsover in respect of sales, nor have we ever received a fee from any lawyer at any time. They should solely act in the interests of their client the buyer, whom is also a client of ours again for the future we hope.
The buyers lawyer is responsible for any and all checks on the property for sale, again that is independent of any involvment of ourselves. We are no longer a member of the MLS system, and we would certainly not want to clog up our own database with illegally built or mis declared properties, and any half decent lawyer will not allow their clients to buy any such property.
Our property negotiators will receive no part or commission of any conveyancing deposit or fee, and actually I don’t see that any property is per se “crap or unsaleable”, someone owns it, therefore someone must have originally bought it, and as I said in an earlier post – everything sells at the right price – and lets not forget it is someone’s home!
Once again, this exercise is not part of a grab the money and run scenario, it just would not work that way, even in the short term.
As for developments, our property negotiators will be paid exactly the same as if they were selling a resale property, no difference at all. And as for the problems with the off plan market, I think we are all aware that there are many good and viable developers building good and quality projects along the entire coast that are not affected by the problems you mention.
And I genuinely don’t believe that we are in the business of literally pushing people into making these decisions, you may not be aware however, or perhaps be pleased to know, that the vast majority of buyers with our company actually purchase resale properties.
I would also venture that today’s buyer is far more informed, and better able to make up their own minds about the end use and decision process of their purchase. I don’t want to sound trite, but our job is simply to show what is available and leave the buyer to decide.
As for personnel who speak more languages, again you may not be aware that in a clear majority we have far more non English staff than English only, I think uniquely we have a broad spread of all European’s and a solid number of Spanish nationals. Our board of directors has only myself as an English person on it for example.
As for Spanish vendors, that again is for them to decide, but they may take the view that the total amount payable is 3%, I wonder what the mentioned gentlemen might think of that against the traditional Spanish agency fees? Higher or lower? Again, what promotion will the Spanish vendor now receive within that total of 3%? I am not seeking to justify our position here, simply to clarify.
Finally, this is not an upfront listing fee, it is a deposit against your conveyancing, which we are committed to do for you the vendor upon the sale of your property, whether privately, through another agent or with ourselves. Why would that be refunded? You simply should not pay the fee or enter into the arrangement unless you are convinced you are going to sell your property in the future.
It is indeed a bank holiday, and as ever we don’t take them here, we all keep our offices open and stay beavering away!
I am so sorry this post was so long, I did not know how to make it shorter. Looking foward to the coffee.
Chris
-
@charlie wrote:
Yes, we do ask for a nominal deposit, this is set against the 1% conveyancing fee, for example on a sale of 225,000 euros the fee 1% would be 2,225 euros, we ask for a deposit against that fee of 20% i.e. 225 euros.
……Correction Chris. 20% of 2,250 Euros makes a deposit of 450 Euros. Not 225.
Katerina
Dear Katerina,
My apologies, you are entirely correct!
Thanks
Chris
-
@charlie wrote:
Yes, we do ask for a nominal deposit, this is set against the 1% conveyancing fee, for example on a sale of 225,000 euros the fee 1% would be 2,225 euros, we ask for a deposit against that fee of 20% i.e. 225 euros.
……Correction Chris. 20% of 2,250 Euros makes a deposit of 450 Euros. Not 225.
Katerina
Dear Katerina,
My apologies, you are entirely correct!
Thanks
Chris
-
Chris,
Apologies for being a pain! With your new system of a lawyer for the vendor, are you promoting the idea that the Spanish market moves to the English system where the sales contract is negotiated by separate lawyers acting for the buyer and seller? However, with the notarial system, why the need for the vendor to have a lawyer? Is this not just a subtle way of camouflaging a 3% commission and not 2%? And,what exactly is your in-house lawyer going to do? I bet you wish you never poked your head over the parapet!!!
Saludos,
James
-
Chris,
Apologies for being a pain! With your new system of a lawyer for the vendor, are you promoting the idea that the Spanish market moves to the English system where the sales contract is negotiated by separate lawyers acting for the buyer and seller? However, with the notarial system, why the need for the vendor to have a lawyer? Is this not just a subtle way of camouflaging a 3% commission and not 2%? And,what exactly is your in-house lawyer going to do? I bet you wish you never poked your head over the parapet!!!
Saludos,
James
-
@charlie wrote:
@Chris McCarthy wrote:
Dear Mary,
Dear Chris
Am afraid you were advised badly (possibly by the developer?).
Just so you are aware re. Green Hills, the questions and answers below were between ourselves and the ‘new’ Town Planning Department in Marbella just last week.So there, Chris – on this forum, we may ‘throw you to the lions’ sometimes, but we do throw in a few large bones from time to time (when praise is due….).
But I have to ask the question: Why is it your company was still advertising this development, despite suspension of building works going back as far as October 2003? The withdrawal of permission re. the golf course in the Summer that year should have rung some alarm bells with you – especially bearing in mind you were in a good position to be fully aware of the Mayor Gil scandal. Apparantly everybody in the ‘property game’ knew what was ‘in the air’ that Summer – except us purchasers!
Barbara
Hi Barbara,
Have edited the quote above because it was rather long, but I very much appreciated the content. Not simply the compliment, really the detailed content.
And to try and answer your question, if by advertising the development you mean in our publication HOT Properties that would be a paid for advertisement on behalf of the developer. As for further promotion via the website and or other media, I suppose the simple answer would be that we take all developments on trust and a certain due diligence, and where or when there are issues that are raised we address these directly.
In the case of this development and it’s issues; when these became evident, any clients we had were I believe notified directly by ourselves, by registered mail and we gave clear advice to withdraw from any contract, and naturally lost a considerable amount of business and good faith.
But I don’t know, what to say really, in truth we were always led to believe that issues with this particular development and with a number of others, were to be resolved. We were and are as flummoxed as anybody with the way the planning and subsequent scandal transpired.
We also believed that it was entirely in the hands of each individual lawyer to ensure that a clients interest or rights were protected. That I appreciate may seem like a cop out, but actually it is true, and if the Spanish government did not know or act to remove the town council until they did so, I don’t know how we could.
In some defence of the developer, although I may be making a rod for my own back, as you are obviously far better informed on this issue; we had a good experience and working relationship with the developers of this particular development, we had known them and worked with them on a number of very good projects over the years, I would imagine they themselves are mortified at the mess that has ensued and I have real difficulty believing they would have anticipated any of these problems.
But I think we are getting away from the issue of Estate Agent Fees here, and we and our own clients hope that the various issues on a number of projects will be resolved soon and one by one cleared up entirely.
Chris
-
@charlie wrote:
@Chris McCarthy wrote:
Dear Mary,
Dear Chris
Am afraid you were advised badly (possibly by the developer?).
Just so you are aware re. Green Hills, the questions and answers below were between ourselves and the ‘new’ Town Planning Department in Marbella just last week.So there, Chris – on this forum, we may ‘throw you to the lions’ sometimes, but we do throw in a few large bones from time to time (when praise is due….).
But I have to ask the question: Why is it your company was still advertising this development, despite suspension of building works going back as far as October 2003? The withdrawal of permission re. the golf course in the Summer that year should have rung some alarm bells with you – especially bearing in mind you were in a good position to be fully aware of the Mayor Gil scandal. Apparantly everybody in the ‘property game’ knew what was ‘in the air’ that Summer – except us purchasers!
Barbara
Hi Barbara,
Have edited the quote above because it was rather long, but I very much appreciated the content. Not simply the compliment, really the detailed content.
And to try and answer your question, if by advertising the development you mean in our publication HOT Properties that would be a paid for advertisement on behalf of the developer. As for further promotion via the website and or other media, I suppose the simple answer would be that we take all developments on trust and a certain due diligence, and where or when there are issues that are raised we address these directly.
In the case of this development and it’s issues; when these became evident, any clients we had were I believe notified directly by ourselves, by registered mail and we gave clear advice to withdraw from any contract, and naturally lost a considerable amount of business and good faith.
But I don’t know, what to say really, in truth we were always led to believe that issues with this particular development and with a number of others, were to be resolved. We were and are as flummoxed as anybody with the way the planning and subsequent scandal transpired.
We also believed that it was entirely in the hands of each individual lawyer to ensure that a clients interest or rights were protected. That I appreciate may seem like a cop out, but actually it is true, and if the Spanish government did not know or act to remove the town council until they did so, I don’t know how we could.
In some defence of the developer, although I may be making a rod for my own back, as you are obviously far better informed on this issue; we had a good experience and working relationship with the developers of this particular development, we had known them and worked with them on a number of very good projects over the years, I would imagine they themselves are mortified at the mess that has ensued and I have real difficulty believing they would have anticipated any of these problems.
But I think we are getting away from the issue of Estate Agent Fees here, and we and our own clients hope that the various issues on a number of projects will be resolved soon and one by one cleared up entirely.
Chris
-
-
-
Hi All,
New to the site and yes I work within the industry……I have a couple of comments that may or may not be responded to…
I do work in the industry and my company has only charged 4% on all property from its inception, 3% if over 1.4m and that includes developers sales, where we cash-back the difference, will you be following our lead again?? Or are you still accepting the 6, 8, 10% that the developers pay…..without informing the clients what you are actually earning.
As a founder member of the IN why is it that you now are “breaking away”. As I understood it you were one of the parties involved in the set up of the IN.( I maybe incorrect ). Is this still going to be around?? Do V still own the head office??
I believed that you were fundamental in the inception of the 7.5% commissions that V were reknowned for…..is this realisation of the clients now understanding how much they were being charged, 8% commssion when they bought, 7.5% when they sell, 1.5% for the lawyer….I presume that your sales people will still be earning a form of commission? otherwise why would they bother to sell?? all sales people need an motivation or an incentive…
Truely Independant lawyers, if you ask around, will be happy to deal with agents and only charge 0.5%-0.75%, sometimes less, if the agent doesnt want the extra paid back to them ( hence the 1%-1.5% )…we have a number on our books if you would like to talk to them….
I truely believe that the coast will benefit from lower commissions and it will help to stabalise the market place, we have been speaking to many developers, lawyers other agents and I can understand where you are coming from, as long as this is not a short term shake up, trying to corner the market on resales, put the smaller agents out of business, before raising the commission again as has been done before!
-
Hi All,
New to the site and yes I work within the industry……I have a couple of comments that may or may not be responded to…
I do work in the industry and my company has only charged 4% on all property from its inception, 3% if over 1.4m and that includes developers sales, where we cash-back the difference, will you be following our lead again?? Or are you still accepting the 6, 8, 10% that the developers pay…..without informing the clients what you are actually earning.
As a founder member of the IN why is it that you now are “breaking away”. As I understood it you were one of the parties involved in the set up of the IN.( I maybe incorrect ). Is this still going to be around?? Do V still own the head office??
I believed that you were fundamental in the inception of the 7.5% commissions that V were reknowned for…..is this realisation of the clients now understanding how much they were being charged, 8% commssion when they bought, 7.5% when they sell, 1.5% for the lawyer….I presume that your sales people will still be earning a form of commission? otherwise why would they bother to sell?? all sales people need an motivation or an incentive…
Truely Independant lawyers, if you ask around, will be happy to deal with agents and only charge 0.5%-0.75%, sometimes less, if the agent doesnt want the extra paid back to them ( hence the 1%-1.5% )…we have a number on our books if you would like to talk to them….
I truely believe that the coast will benefit from lower commissions and it will help to stabalise the market place, we have been speaking to many developers, lawyers other agents and I can understand where you are coming from, as long as this is not a short term shake up, trying to corner the market on resales, put the smaller agents out of business, before raising the commission again as has been done before!
-
@casalaloba wrote:
Hola again Chris,
Thanks for reply. My maths is spot on. If a property is advertised at 200,000€, all costs included, the net property cost would be as quoted in my message. Your calculation is based on the premise that the price for the property is 200,000 EXCLUDING YOUR COMMISSION/FEES. Hence my original post. Will you be advertising properties net or inclusive of your firms costs of 3.48% (IVA inc)? A wise purchaser will want to know how much of their total investment in a property here relates to commissions and all other costs. That approach concentrates your mind on the price you are paying for the property element. As the purchaser provides the money for your commission, why do you not have a separate fee contract which will reduce, quite legally, the amount in the escritura and thus all the percentage based costs for the notario,taxes etc. This would in no way effect the calculation for CGT as the vendor can reduce the gain by the amount billed by your company.
As for “celebrities” I just do not get it. They must carry a cost for you. Why would anyone be influenced to buy a property because some “known face” says you are good guys. In my experience what best sells property is the quality of the product itself, the transparency of the buying process and the professionalism of the intermediaries. Sportsmen, soap stars etc all have their just place in life….on the sports field,on the tele etc. Each one to their speciality!!! From my viewpoint I would never use an agency that carried a celebrity endorsement. But I would consider
an agency whose services were founded on professionalism, knowledge,
transparency etc…It would be a breath of fresh air if your participation in this forum helps you to change the face of agency practices in much of Spain. I congratulate you on listening and accepting the barbs. But I’ll reserve final judgement for the moment!
Saludos,
James
Hi James,
I think this is my misunderstanding, and I am sorry if I have confused you. The fact is that we are charging a commission on the full sale price, yes. We see that as being within the sale price and as being paid by the vendor allowing him to decide upon the net amount he is happy to recieve after our fees.
I hope that explains the issue. I don’t think we will per see be advertising the full breakdown, we will simply be stating that we charge a 2% sales commission and a 1% conveyancing, these are separate if you sell privately.
On the subject of a contract with a buyer, one supposes if a vendor asked us to do such a contract and the buyer was happy to do so, it might be possible or feasible, we had never considered it.
But I don’t know that the vendor can reduce his CGT by billing us, you are stating that the buyer has the contract and makes the payment, so the vendor would not be able to bill us.
Will put this scenario out to several of our people here and see what they think, though I do believe we prefer to be seen and to act on behalf of the vendor in terms of payment.
Again, as to the celebrity endorsement, it is a marketing issue, and is only used to promote and differentiate our proposition in the UK press and pretty much nowhere else, the particular celebrity I understand also endorse products such as Shredded Wheat and I think British Meat, it works for some and not for others, but hopefully we will find a way in future to equally present a professional, experienced and knowledeable proposition, although this is difficult in an advert the size of a cigarette packet!
Thanks for your questions, I think I have about answered them all, and I genuinely don’t mind the barbs, well as long as they are not personal, but I really did begin the process of changing our model as a result of looking through this forum, so if I can present our case here and have it at least be given the chance of suspended judgement then I am happy to answer any remaining questions, if there are any left that is!
Chris
-
@casalaloba wrote:
Hola again Chris,
Thanks for reply. My maths is spot on. If a property is advertised at 200,000€, all costs included, the net property cost would be as quoted in my message. Your calculation is based on the premise that the price for the property is 200,000 EXCLUDING YOUR COMMISSION/FEES. Hence my original post. Will you be advertising properties net or inclusive of your firms costs of 3.48% (IVA inc)? A wise purchaser will want to know how much of their total investment in a property here relates to commissions and all other costs. That approach concentrates your mind on the price you are paying for the property element. As the purchaser provides the money for your commission, why do you not have a separate fee contract which will reduce, quite legally, the amount in the escritura and thus all the percentage based costs for the notario,taxes etc. This would in no way effect the calculation for CGT as the vendor can reduce the gain by the amount billed by your company.
As for “celebrities” I just do not get it. They must carry a cost for you. Why would anyone be influenced to buy a property because some “known face” says you are good guys. In my experience what best sells property is the quality of the product itself, the transparency of the buying process and the professionalism of the intermediaries. Sportsmen, soap stars etc all have their just place in life….on the sports field,on the tele etc. Each one to their speciality!!! From my viewpoint I would never use an agency that carried a celebrity endorsement. But I would consider
an agency whose services were founded on professionalism, knowledge,
transparency etc…It would be a breath of fresh air if your participation in this forum helps you to change the face of agency practices in much of Spain. I congratulate you on listening and accepting the barbs. But I’ll reserve final judgement for the moment!
Saludos,
James
Hi James,
I think this is my misunderstanding, and I am sorry if I have confused you. The fact is that we are charging a commission on the full sale price, yes. We see that as being within the sale price and as being paid by the vendor allowing him to decide upon the net amount he is happy to recieve after our fees.
I hope that explains the issue. I don’t think we will per see be advertising the full breakdown, we will simply be stating that we charge a 2% sales commission and a 1% conveyancing, these are separate if you sell privately.
On the subject of a contract with a buyer, one supposes if a vendor asked us to do such a contract and the buyer was happy to do so, it might be possible or feasible, we had never considered it.
But I don’t know that the vendor can reduce his CGT by billing us, you are stating that the buyer has the contract and makes the payment, so the vendor would not be able to bill us.
Will put this scenario out to several of our people here and see what they think, though I do believe we prefer to be seen and to act on behalf of the vendor in terms of payment.
Again, as to the celebrity endorsement, it is a marketing issue, and is only used to promote and differentiate our proposition in the UK press and pretty much nowhere else, the particular celebrity I understand also endorse products such as Shredded Wheat and I think British Meat, it works for some and not for others, but hopefully we will find a way in future to equally present a professional, experienced and knowledeable proposition, although this is difficult in an advert the size of a cigarette packet!
Thanks for your questions, I think I have about answered them all, and I genuinely don’t mind the barbs, well as long as they are not personal, but I really did begin the process of changing our model as a result of looking through this forum, so if I can present our case here and have it at least be given the chance of suspended judgement then I am happy to answer any remaining questions, if there are any left that is!
Chris
-
@casalaloba wrote:
Chris,
Apologies for being a pain! With your new system of a lawyer for the vendor, are you promoting the idea that the Spanish market moves to the English system where the sales contract is negotiated by separate lawyers acting for the buyer and seller? However, with the notarial system, why the need for the vendor to have a lawyer? Is this not just a subtle way of camouflaging a 3% commission and not 2%? And,what exactly is your in-house lawyer going to do? I bet you wish you never poked your head over the parapet!!!
Saludos,
James
Hi James,
It could be seen as a subtle way of camouflaging a 3% commission yes, and as I think I stated somewhere else, you are right, there is no actual need for a lawyer, almost no Spanish national would use a lawyer in selling their property, but I think you have to put yourself in the position of the standard client, who speaks no Spanish, does not understand the legal system and very genuinely needs help with the actual sale.
We undertake to take on the role as opposed to a lawyer, and to do so irrespective of whether we sell the property. As previously stated also, we have processed more than 8,000 contracts over the years, and we think we can do the job efficiently and well, otherwise we would not present our case for the conveyancing fee.
Our In House lawyers are going to have plenty to do hopefully, not every sale is totally clear cut, not by a long chalk.
Back to the parapet!!!
Chris
-
@casalaloba wrote:
Chris,
Apologies for being a pain! With your new system of a lawyer for the vendor, are you promoting the idea that the Spanish market moves to the English system where the sales contract is negotiated by separate lawyers acting for the buyer and seller? However, with the notarial system, why the need for the vendor to have a lawyer? Is this not just a subtle way of camouflaging a 3% commission and not 2%? And,what exactly is your in-house lawyer going to do? I bet you wish you never poked your head over the parapet!!!
Saludos,
James
Hi James,
It could be seen as a subtle way of camouflaging a 3% commission yes, and as I think I stated somewhere else, you are right, there is no actual need for a lawyer, almost no Spanish national would use a lawyer in selling their property, but I think you have to put yourself in the position of the standard client, who speaks no Spanish, does not understand the legal system and very genuinely needs help with the actual sale.
We undertake to take on the role as opposed to a lawyer, and to do so irrespective of whether we sell the property. As previously stated also, we have processed more than 8,000 contracts over the years, and we think we can do the job efficiently and well, otherwise we would not present our case for the conveyancing fee.
Our In House lawyers are going to have plenty to do hopefully, not every sale is totally clear cut, not by a long chalk.
Back to the parapet!!!
Chris
-
@Flynn wrote:
Chris
Could you tell us if you are planning to drop or reduce the 50% FEE your company takes from the seller’s 3000€ holding deposits when a sale falls through ❓
Hi Flynn,
I think you are referring to the situation where a buyer places a reservation / holding deposit on a property and withdraws from the process through no fault of the vendor.
Under our previous contracts, this in the past has allowed the vendor to be paid 50% of the reservation deposit in compensation, and has allowed us to retain the other 50%.
In practice, though it may suprise you, I believe in 99% of cases we have never actually retained the 50% fee, we have without fanfare sought to quietly return these funds to the once prospective buyer, only where we feel that our time and effort has been perhaps abused by that prospective purchaser have we ever kept the reservation deposit. And this has, as I say been extremely rare. We don’t advertise the fact, because our negotiators would possibly present it as a returnable fee, which would not serve the vendors interests or ours really. But you have asked so that cat is out of the bag for now.
Chris
-
@Flynn wrote:
Chris
Could you tell us if you are planning to drop or reduce the 50% FEE your company takes from the seller’s 3000€ holding deposits when a sale falls through ❓
Hi Flynn,
I think you are referring to the situation where a buyer places a reservation / holding deposit on a property and withdraws from the process through no fault of the vendor.
Under our previous contracts, this in the past has allowed the vendor to be paid 50% of the reservation deposit in compensation, and has allowed us to retain the other 50%.
In practice, though it may suprise you, I believe in 99% of cases we have never actually retained the 50% fee, we have without fanfare sought to quietly return these funds to the once prospective buyer, only where we feel that our time and effort has been perhaps abused by that prospective purchaser have we ever kept the reservation deposit. And this has, as I say been extremely rare. We don’t advertise the fact, because our negotiators would possibly present it as a returnable fee, which would not serve the vendors interests or ours really. But you have asked so that cat is out of the bag for now.
Chris
-
Hi Chris,
Thanks again. I bought a property last year. I had a separate contract for the commission with the agent which was settled when we signed at the notary. My “other” buying costs were thus marginally reduced but the bill I received from the agent still formed part of my total acquisition costs for the calculation of a future capital gain.
Sorry, but still confused by your commission arrangement. When you take on a property do you advise the buyer what price you consider the market will support and advertise it at this price ,with your commission being paid out of the eventual sale proceeds. Or, do you agree a price with the vendor, ADD your commission and market it at a commission inclusive price?
I appreciate that the effect of this when calculating your commission of 2.32% is hugely less distorting than when commissions of 10% and above are hidden within the sales price. But there is still an added cost if commission is calculated on a commission inclusive price. Given the awful press the agency sector is receiving, total transparency is essential to restore confidence in the buying process..
Also, I repeat my earlier comment that it is my understanding that you are obliged by a Royal Decree of Feb this year to provide a breakdown of the total consideration between “bricks and mortar” and all other charges. If I had an agency, I would do this as a matter of course.
If a lot of us had known that pensions advisers were taking fees irrespective of the performance of our funds many of us would have left the money in the bank. It has to be the same with you guys. We want to know the division of the monies we hand over when we buy a property.
Saludos,
James
-
Hi Chris,
Thanks again. I bought a property last year. I had a separate contract for the commission with the agent which was settled when we signed at the notary. My “other” buying costs were thus marginally reduced but the bill I received from the agent still formed part of my total acquisition costs for the calculation of a future capital gain.
Sorry, but still confused by your commission arrangement. When you take on a property do you advise the buyer what price you consider the market will support and advertise it at this price ,with your commission being paid out of the eventual sale proceeds. Or, do you agree a price with the vendor, ADD your commission and market it at a commission inclusive price?
I appreciate that the effect of this when calculating your commission of 2.32% is hugely less distorting than when commissions of 10% and above are hidden within the sales price. But there is still an added cost if commission is calculated on a commission inclusive price. Given the awful press the agency sector is receiving, total transparency is essential to restore confidence in the buying process..
Also, I repeat my earlier comment that it is my understanding that you are obliged by a Royal Decree of Feb this year to provide a breakdown of the total consideration between “bricks and mortar” and all other charges. If I had an agency, I would do this as a matter of course.
If a lot of us had known that pensions advisers were taking fees irrespective of the performance of our funds many of us would have left the money in the bank. It has to be the same with you guys. We want to know the division of the monies we hand over when we buy a property.
Saludos,
James
-
-
-
Thank you Chris for your reply, forgive me if I’m sceptical of your response, as when this happened to me and I challenged one of your IN members as to WHY you should keep half MY holding fee (seller) the agent smugly waved a copy of YOUR contract in my face and told me VIVA keep the rest to cover THEIR inconvienience, and no the failed buyer didn’t see any of his 9000€ back either.
Should you be genuinly serious in your aim to look after clients, my suggestion would be to weed out IN members who deliberately push off plan when bringing clients around to Viva’s resale clients.
I lost 2 potential sales whilst on your books, through this underhand behaviour and was only made wise to it because my IN member office where so angry that they told me the truth.
-
Thank you Chris for your reply, forgive me if I’m sceptical of your response, as when this happened to me and I challenged one of your IN members as to WHY you should keep half MY holding fee (seller) the agent smugly waved a copy of YOUR contract in my face and told me VIVA keep the rest to cover THEIR inconvienience, and no the failed buyer didn’t see any of his 9000€ back either.
Should you be genuinly serious in your aim to look after clients, my suggestion would be to weed out IN members who deliberately push off plan when bringing clients around to Viva’s resale clients.
I lost 2 potential sales whilst on your books, through this underhand behaviour and was only made wise to it because my IN member office where so angry that they told me the truth.
-
@Chris McCarthy wrote:
As to fessing up to what we will pay our property negotiators – our preferred term to salespeople – we will again be entirely open about the facts rather than allow rumour to abound.
Chris,
You being entirely open about the facts is much appreciated.
However, a couple of rumours remain:Is it true that:
– your salespeople have to convert 26 listings per month from MLS to new 2% structure?
– AND do 2 deals per month in order to get the 3000 fixed salary?– and that you have closed the IN MLS down?
-
@Chris McCarthy wrote:
As to fessing up to what we will pay our property negotiators – our preferred term to salespeople – we will again be entirely open about the facts rather than allow rumour to abound.
Chris,
You being entirely open about the facts is much appreciated.
However, a couple of rumours remain:Is it true that:
– your salespeople have to convert 26 listings per month from MLS to new 2% structure?
– AND do 2 deals per month in order to get the 3000 fixed salary?– and that you have closed the IN MLS down?
-
-
-
@T5golfer wrote:
Hi All,
New to the site and yes I work within the industry……I have a couple of comments that may or may not be responded to…
I do work in the industry and my company has only charged 4% on all property from its inception, 3% if over 1.4m and that includes developers sales, where we cash-back the difference, will you be following our lead again?? Or are you still accepting the 6, 8, 10% that the developers pay…..without informing the clients what you are actually earning.
As a founder member of the IN why is it that you now are “breaking away”. As I understood it you were one of the parties involved in the set up of the IN.( I maybe incorrect ). Is this still going to be around?? Do V still own the head office??
I believed that you were fundamental in the inception of the 7.5% commissions that V were reknowned for…..is this realisation of the clients now understanding how much they were being charged, 8% commssion when they bought, 7.5% when they sell, 1.5% for the lawyer….I presume that your sales people will still be earning a form of commission? otherwise why would they bother to sell?? all sales people need an motivation or an incentive…
Truely Independant lawyers, if you ask around, will be happy to deal with agents and only charge 0.5%-0.75%, sometimes less, if the agent doesnt want the extra paid back to them ( hence the 1%-1.5% )…we have a number on our books if you would like to talk to them….
I truely believe that the coast will benefit from lower commissions and it will help to stabalise the market place, we have been speaking to many developers, lawyers other agents and I can understand where you are coming from, as long as this is not a short term shake up, trying to corner the market on resales, put the smaller agents out of business, before raising the commission again as has been done before!
Hi Tsgolfer,
I came into the forum to answer any questions on our decision to move to a 2% sales commission and to try and be concise and precise as to the various elements within this, basically to help clarify the various rumours that are reverberating around.
The above quote and questions are varied and mixed, I have no problem with them, and I will answer each of them but it might be better if I were asked just the one or two questions in each post, and then send me another post with the next question/s.
Just a thought, I am new to this sort of thing and don’t know fully how it works, my computer packed up on me last night with something called an “application error” and I lost the whole response I was making to you. And it occurs to me that in this sort of forum people probably don’t want me waffling on and espousing at great length.
So, if it is OK I will split the questions up and answer them separately during the morning, as I also have a fairly busy day today.
Thanks
Chris
-
@T5golfer wrote:
Hi All,
New to the site and yes I work within the industry……I have a couple of comments that may or may not be responded to…
I do work in the industry and my company has only charged 4% on all property from its inception, 3% if over 1.4m and that includes developers sales, where we cash-back the difference, will you be following our lead again?? Or are you still accepting the 6, 8, 10% that the developers pay…..without informing the clients what you are actually earning.
As a founder member of the IN why is it that you now are “breaking away”. As I understood it you were one of the parties involved in the set up of the IN.( I maybe incorrect ). Is this still going to be around?? Do V still own the head office??
I believed that you were fundamental in the inception of the 7.5% commissions that V were reknowned for…..is this realisation of the clients now understanding how much they were being charged, 8% commssion when they bought, 7.5% when they sell, 1.5% for the lawyer….I presume that your sales people will still be earning a form of commission? otherwise why would they bother to sell?? all sales people need an motivation or an incentive…
Truely Independant lawyers, if you ask around, will be happy to deal with agents and only charge 0.5%-0.75%, sometimes less, if the agent doesnt want the extra paid back to them ( hence the 1%-1.5% )…we have a number on our books if you would like to talk to them….
I truely believe that the coast will benefit from lower commissions and it will help to stabalise the market place, we have been speaking to many developers, lawyers other agents and I can understand where you are coming from, as long as this is not a short term shake up, trying to corner the market on resales, put the smaller agents out of business, before raising the commission again as has been done before!
Hi Tsgolfer,
I came into the forum to answer any questions on our decision to move to a 2% sales commission and to try and be concise and precise as to the various elements within this, basically to help clarify the various rumours that are reverberating around.
The above quote and questions are varied and mixed, I have no problem with them, and I will answer each of them but it might be better if I were asked just the one or two questions in each post, and then send me another post with the next question/s.
Just a thought, I am new to this sort of thing and don’t know fully how it works, my computer packed up on me last night with something called an “application error” and I lost the whole response I was making to you. And it occurs to me that in this sort of forum people probably don’t want me waffling on and espousing at great length.
So, if it is OK I will split the questions up and answer them separately during the morning, as I also have a fairly busy day today.
Thanks
Chris
-
Hi Chris,
I have a couple of questions.
Earlier in one of your threads, you pointed out that U.K agents operate on 1.5% commission, and must be profitable at that to survive, hence one of your reasons for reducing the commission.
My questions are these:
On this level of commission, how can you expect to fund Inspection visits, exhibitions, marketing campaigns etc to sell the resales? These are all things that U.K agents do not do, hence the commission rate is lower.
Also how are you going to employ good sales people on much lower commissions? You cannot fund large basic salaries with these commissions either. What would your package be?
Will this not just lead to the sales people only selling developments, in order to earn more. In fact this may be internally driven, to help you balance things out.
I do not see this as a sustainable rate, as this market is not like the U.K market, where buyers drive along a street and see a for sale board and just ring that agent.
Your comments would be welcome
Joe[/i]
-
Hi Chris,
I have a couple of questions.
Earlier in one of your threads, you pointed out that U.K agents operate on 1.5% commission, and must be profitable at that to survive, hence one of your reasons for reducing the commission.
My questions are these:
On this level of commission, how can you expect to fund Inspection visits, exhibitions, marketing campaigns etc to sell the resales? These are all things that U.K agents do not do, hence the commission rate is lower.
Also how are you going to employ good sales people on much lower commissions? You cannot fund large basic salaries with these commissions either. What would your package be?
Will this not just lead to the sales people only selling developments, in order to earn more. In fact this may be internally driven, to help you balance things out.
I do not see this as a sustainable rate, as this market is not like the U.K market, where buyers drive along a street and see a for sale board and just ring that agent.
Your comments would be welcome
Joe[/i]
-
@T5golfer wrote:
Hi All,
New to the site and yes I work within the industry……I have a couple of comments that may or may not be responded to…
I do work in the industry and my company has only charged 4% on all property from its inception, 3% if over 1.4m and that includes developers sales, where we cash-back the difference, will you be following our lead again?? Or are you still accepting the 6, 8, 10% that the developers pay…..without informing the clients what you are actually earning.
Hi Tsgolfer,
I am not aware of whom your company might be, and offering a cash-back on the difference seems highly laudable, I have not heard of this practice before and it is an interesting concept.
I am also not aware that we are actually following anyone’s lead here, I think we have simply created our own business model going forward.
But let’s get to the point; cash-back or marketing expense? Or are they both the same thing? I don’t know what volume of business or transactions your company does, or how you market. However, I would ask you to accept that our company operates in a different way to most; particularly this is so, in that we co-market with a number of developers on a rather large scale, we run marketing campaigns locally and externally that run into a cost of many millions of euros per annum.
For our sins we try to be innovative, we try to create a differentiation and I would say that the selling of a development for us is not simply that of walking up and in with Mr and Mrs Jones and picking up the gross fee of 6-10% that some developers pay.
We co-market, and we account within any commission we receive an expense toward direct marketing, and as previously stated the vast majority of our sales are currently resales, the fees we receive from developers are not therefore simply sales commissions, they reflect therefore as both a sales and a marketing commission.
It is a bit of a bug bear to us, but we live with it, that there are apparently (just one more government statistic right or wrong) some 4,000 registered real estate agents on the Costa del Sol and that any number of developers will pay a high commission to any soul walking in with a business card.
But the client pays generally the list price, the same price as any other party, or should be doing so, our net sales commission on developments is not so different from that of resales, and our property negotiators are paid the same bonus regardless or resale or development.
Mr and Mrs Jones of course are also entirely free to visit developers privately on their own and negotiate their own purchase, but is this the best scenario? When there are literally hundreds of projects available and how can they obtain enough knowledge to know which suits their requirements, and that there isn’t another just around the corner that might be a better fit?
So, we might follow your lead yes. We could abandon our current marketing model and cost structure, in favour of using a proportion of the fee received; as a direct incentive or marketing tool in the form of a cash-back scenario. Buy with me and receive 10,000 cash-back, but is that not a lure, a hook, a marketing expense paid for by the developer? Is it not the same thing?
What might be a better way of looking at this, is if we are making or taking huge profits, paying hugely inflated earnings to commission only salespeople and burning our way around Europe, hard selling, pitching investment, investment, investment, to whoever we can get our hands on for half an hour.
I don’t believe we are, we are a dedicated Spanish real estate agent, trying to offer our best service and advice to our customers, and receiving now an appropriate fee in each case.
Jeeze, I hope that wasn’t too long but I don’t know what else to do.
Will keep my other answers to your other questions a lot simpler!
Thanks
Chris
-
@T5golfer wrote:
Hi All,
New to the site and yes I work within the industry……I have a couple of comments that may or may not be responded to…
I do work in the industry and my company has only charged 4% on all property from its inception, 3% if over 1.4m and that includes developers sales, where we cash-back the difference, will you be following our lead again?? Or are you still accepting the 6, 8, 10% that the developers pay…..without informing the clients what you are actually earning.
Hi Tsgolfer,
I am not aware of whom your company might be, and offering a cash-back on the difference seems highly laudable, I have not heard of this practice before and it is an interesting concept.
I am also not aware that we are actually following anyone’s lead here, I think we have simply created our own business model going forward.
But let’s get to the point; cash-back or marketing expense? Or are they both the same thing? I don’t know what volume of business or transactions your company does, or how you market. However, I would ask you to accept that our company operates in a different way to most; particularly this is so, in that we co-market with a number of developers on a rather large scale, we run marketing campaigns locally and externally that run into a cost of many millions of euros per annum.
For our sins we try to be innovative, we try to create a differentiation and I would say that the selling of a development for us is not simply that of walking up and in with Mr and Mrs Jones and picking up the gross fee of 6-10% that some developers pay.
We co-market, and we account within any commission we receive an expense toward direct marketing, and as previously stated the vast majority of our sales are currently resales, the fees we receive from developers are not therefore simply sales commissions, they reflect therefore as both a sales and a marketing commission.
It is a bit of a bug bear to us, but we live with it, that there are apparently (just one more government statistic right or wrong) some 4,000 registered real estate agents on the Costa del Sol and that any number of developers will pay a high commission to any soul walking in with a business card.
But the client pays generally the list price, the same price as any other party, or should be doing so, our net sales commission on developments is not so different from that of resales, and our property negotiators are paid the same bonus regardless or resale or development.
Mr and Mrs Jones of course are also entirely free to visit developers privately on their own and negotiate their own purchase, but is this the best scenario? When there are literally hundreds of projects available and how can they obtain enough knowledge to know which suits their requirements, and that there isn’t another just around the corner that might be a better fit?
So, we might follow your lead yes. We could abandon our current marketing model and cost structure, in favour of using a proportion of the fee received; as a direct incentive or marketing tool in the form of a cash-back scenario. Buy with me and receive 10,000 cash-back, but is that not a lure, a hook, a marketing expense paid for by the developer? Is it not the same thing?
What might be a better way of looking at this, is if we are making or taking huge profits, paying hugely inflated earnings to commission only salespeople and burning our way around Europe, hard selling, pitching investment, investment, investment, to whoever we can get our hands on for half an hour.
I don’t believe we are, we are a dedicated Spanish real estate agent, trying to offer our best service and advice to our customers, and receiving now an appropriate fee in each case.
Jeeze, I hope that wasn’t too long but I don’t know what else to do.
Will keep my other answers to your other questions a lot simpler!
Thanks
Chris
-
@T5golfer wrote:
Hi All,
New to the site and yes I work within the industry……As a founder member of the IN why is it that you now are “breaking away”. As I understood it you were one of the parties involved in the set up of the IN.( I maybe incorrect ). Is this still going to be around?? Do V still own the head office??
Hi Tsgolfer,
Next question…
We resigned from our membership of the IN Network on Monday evening.
Our reasons for “breaking away” as you put it, are that we believe our customers being both vendors and buyers will in future be best served by our offering a far better value proposition in every respect than that which was available before.
VIVA Estates has had the majority shareholding in the IN Network since I believe late last year, the company IN has ceased trading at present and VIVA is endeavouring to ensure that this does not have a negative impact on the operational and software function of any individual member, and is continuing to underwrite the cost of the IN Network until such time as members can have their own private data returned to them.
Chris
-
@T5golfer wrote:
Hi All,
New to the site and yes I work within the industry……As a founder member of the IN why is it that you now are “breaking away”. As I understood it you were one of the parties involved in the set up of the IN.( I maybe incorrect ). Is this still going to be around?? Do V still own the head office??
Hi Tsgolfer,
Next question…
We resigned from our membership of the IN Network on Monday evening.
Our reasons for “breaking away” as you put it, are that we believe our customers being both vendors and buyers will in future be best served by our offering a far better value proposition in every respect than that which was available before.
VIVA Estates has had the majority shareholding in the IN Network since I believe late last year, the company IN has ceased trading at present and VIVA is endeavouring to ensure that this does not have a negative impact on the operational and software function of any individual member, and is continuing to underwrite the cost of the IN Network until such time as members can have their own private data returned to them.
Chris
-
@T5golfer wrote:
Hi All,
New to the site and yes I work within the industry……I presume that your sales people will still be earning a form of commission? otherwise why would they bother to sell?? all sales people need an motivation or an incentive…
Hi Tsgolfer,
I have outlined I believe elsewhere how our property negotiators will be remunerated, and I can only add this:
We will not be looking at our staff simply as salespeople, they will bother to show properties because it is their job to do so, they will list and show properties under their employment conditions, and their motivation to do so will be their continued employment.
The fact is, we believe the market and the business has matured and the day of high commission based salespeople has had its day.
There is therefore now, more than one way, there is now our way, we hope it will be appreciated and more importantly that it will work to the benefit or our customers being both vendors and buyers.
Chris
-
@T5golfer wrote:
Hi All,
New to the site and yes I work within the industry……I presume that your sales people will still be earning a form of commission? otherwise why would they bother to sell?? all sales people need an motivation or an incentive…
Hi Tsgolfer,
I have outlined I believe elsewhere how our property negotiators will be remunerated, and I can only add this:
We will not be looking at our staff simply as salespeople, they will bother to show properties because it is their job to do so, they will list and show properties under their employment conditions, and their motivation to do so will be their continued employment.
The fact is, we believe the market and the business has matured and the day of high commission based salespeople has had its day.
There is therefore now, more than one way, there is now our way, we hope it will be appreciated and more importantly that it will work to the benefit or our customers being both vendors and buyers.
Chris
-
@T5golfer wrote:
Hi All,
New to the site and yes I work within the industry……Truely Independant lawyers, if you ask around, will be happy to deal with agents and only charge 0.5%-0.75%, sometimes less, if the agent doesnt want the extra paid back to them ( hence the 1%-1.5% )…we have a number on our books if you would like to talk to them….
Hi Tsgolfer,
Thanks for the offer of the lawyers,
One important thing though, that is alluded to in your comments is the comment…and only charge 0.5%-0.75%, sometimes less, if the agent doesnt want the extra paid back to them ( hence the 1%-1.5% )…
This is what has driven me mad over the years, how can a lawyer be truly independent if they are paying an agent a “kickback” out of their fees for the referral of a client?
As a broad estimate we could have earned anywhere between 500k to 1million euros per annum in kickbacks from lawyers, yes that is per year. But we want our buyers lawyers to be totally independent, totally free of any collusion or interest by association with us.
It has always seemed wrong, wrong, wrong to us that it is the norm that most agents receive fees from lawyers. Just plain wrong.
As to lawyers who will work for less, we know most of the lawyers on the coast having been involved in such a volume of transactions over the years, however if there are lawyers out there who are prepared to work for less for our buyers we would be delighted to hear about them and you can mail me privately on that issue.
Thanks again,
Chris
-
@T5golfer wrote:
Hi All,
New to the site and yes I work within the industry……Truely Independant lawyers, if you ask around, will be happy to deal with agents and only charge 0.5%-0.75%, sometimes less, if the agent doesnt want the extra paid back to them ( hence the 1%-1.5% )…we have a number on our books if you would like to talk to them….
Hi Tsgolfer,
Thanks for the offer of the lawyers,
One important thing though, that is alluded to in your comments is the comment…and only charge 0.5%-0.75%, sometimes less, if the agent doesnt want the extra paid back to them ( hence the 1%-1.5% )…
This is what has driven me mad over the years, how can a lawyer be truly independent if they are paying an agent a “kickback” out of their fees for the referral of a client?
As a broad estimate we could have earned anywhere between 500k to 1million euros per annum in kickbacks from lawyers, yes that is per year. But we want our buyers lawyers to be totally independent, totally free of any collusion or interest by association with us.
It has always seemed wrong, wrong, wrong to us that it is the norm that most agents receive fees from lawyers. Just plain wrong.
As to lawyers who will work for less, we know most of the lawyers on the coast having been involved in such a volume of transactions over the years, however if there are lawyers out there who are prepared to work for less for our buyers we would be delighted to hear about them and you can mail me privately on that issue.
Thanks again,
Chris
-
@T5golfer wrote:
Hi All,
New to the site and yes I work within the industry……I truely believe that the coast will benefit from lower commissions and it will help to stabalise the market place, we have been speaking to many developers, lawyers other agents and I can understand where you are coming from, as long as this is not a short term shake up, trying to corner the market on resales, put the smaller agents out of business, before raising the commission again as has been done before!
Hi Tsgolfer,
OK the last point, and hopefully you will allow me to go for some lunch and take a further look at any other mails later!
This is not a short term shake up from our perspective, it is a fundamental long term plan within a new business model.
It would in my opinion be impossible for us to corner the market, the market is too big to do so, and whilst we might naturally have the odd meglamaniac moment, we recognise that the market is made up of many aspects, and competition will certainly be one of them.
As to putting small agents out of business and then raising commissions again, I see that the thought would occur, but it is too grand a conspiracy and too weak a proposition for us to plan as an outcome.
There are many excellent small agents trading on the coast, offering services in a dedicated area, and I think they will be just fine, albeit over a period they may have to consider thier own rates if we are too succesful.
But there may be a number of backroom, bar room, web agents offering 10,000 properties, when they don’t have a single listed property, who might actually struggle in future, yes.
But lets see, we wish everyone else well, we just want to do our thing, within the scale and the plan we have, which does not take into account a machiavellian twist or the destruction of others.
I hope I have answered all your questions from your original post, now am off to lunch!
Chris
-
@T5golfer wrote:
Hi All,
New to the site and yes I work within the industry……I truely believe that the coast will benefit from lower commissions and it will help to stabalise the market place, we have been speaking to many developers, lawyers other agents and I can understand where you are coming from, as long as this is not a short term shake up, trying to corner the market on resales, put the smaller agents out of business, before raising the commission again as has been done before!
Hi Tsgolfer,
OK the last point, and hopefully you will allow me to go for some lunch and take a further look at any other mails later!
This is not a short term shake up from our perspective, it is a fundamental long term plan within a new business model.
It would in my opinion be impossible for us to corner the market, the market is too big to do so, and whilst we might naturally have the odd meglamaniac moment, we recognise that the market is made up of many aspects, and competition will certainly be one of them.
As to putting small agents out of business and then raising commissions again, I see that the thought would occur, but it is too grand a conspiracy and too weak a proposition for us to plan as an outcome.
There are many excellent small agents trading on the coast, offering services in a dedicated area, and I think they will be just fine, albeit over a period they may have to consider thier own rates if we are too succesful.
But there may be a number of backroom, bar room, web agents offering 10,000 properties, when they don’t have a single listed property, who might actually struggle in future, yes.
But lets see, we wish everyone else well, we just want to do our thing, within the scale and the plan we have, which does not take into account a machiavellian twist or the destruction of others.
I hope I have answered all your questions from your original post, now am off to lunch!
Chris
-
-
-
Sorry Claire but I for one am very interested in what is happening. This is an important change which will affect the way properties are bought/sold and effectively bring prices down. A lot of companies will be forced to follow suit. If companies are pushed out of business it could have a knock-on effect regarding unemployment….remember that long-term tenant you may be targeting – if he’s unemployed he’ll be looking for a cheaper rental……
Personally I think it’s great news, as a resident on the Costa del Sol property prices/rentals are spiralling out of reach of the local market with a large chunk of the cost being eaten up by commissions of one sort or another. For those of us not earning commissions the average wage is around 1000 euros a month so getting on the property ladder remains a dream for many of the resident population.
If sale prices are cut due to reduced commissions then this represents a better deal for the buyer yet without any change to the vendor’s nett figure. This may be exactly what’s needed to help the market pick up from it’s current slump.
-
Sorry Claire but I for one am very interested in what is happening. This is an important change which will affect the way properties are bought/sold and effectively bring prices down. A lot of companies will be forced to follow suit. If companies are pushed out of business it could have a knock-on effect regarding unemployment….remember that long-term tenant you may be targeting – if he’s unemployed he’ll be looking for a cheaper rental……
Personally I think it’s great news, as a resident on the Costa del Sol property prices/rentals are spiralling out of reach of the local market with a large chunk of the cost being eaten up by commissions of one sort or another. For those of us not earning commissions the average wage is around 1000 euros a month so getting on the property ladder remains a dream for many of the resident population.
If sale prices are cut due to reduced commissions then this represents a better deal for the buyer yet without any change to the vendor’s nett figure. This may be exactly what’s needed to help the market pick up from it’s current slump.
-
I must say a thankyou for you time and effort in supplying your answers.I realise how busy you must be at this time.
I hope it does work for you, and as stated previously I welcome the change.
We have managed to sell property on the CDS without over the top commissions, and without being part of a MLS, very successfully and I know that the clients are very happy buying property cheaper than they can find it elsewhere or through MLS agents.
However one final query, do the clients listing their property with you at 2% with the upfront fee, have to sign an exclusive contract with you for any period of time or are they free to list said property with other agents??
-
I must say a thankyou for you time and effort in supplying your answers.I realise how busy you must be at this time.
I hope it does work for you, and as stated previously I welcome the change.
We have managed to sell property on the CDS without over the top commissions, and without being part of a MLS, very successfully and I know that the clients are very happy buying property cheaper than they can find it elsewhere or through MLS agents.
However one final query, do the clients listing their property with you at 2% with the upfront fee, have to sign an exclusive contract with you for any period of time or are they free to list said property with other agents??
-
Just a couple of questions…….With regard to the upfront conveyancing fee……what happens to this money if the property does not sell at all through any route – is there a refund after a stipulated period?
Also, for a potential buyer browsing the V website how do you distinguish between those properties which are priced with 2% and those which have the higher 7.5% 😕 ?
-
Just a couple of questions…….With regard to the upfront conveyancing fee……what happens to this money if the property does not sell at all through any route – is there a refund after a stipulated period?
Also, for a potential buyer browsing the V website how do you distinguish between those properties which are priced with 2% and those which have the higher 7.5% 😕 ?
-
wow, this thread has become informative!!
To chris mccarthy, the information has been very interesting. Thanks!A question.
You said you’ve closed down the IN system you use?
Does that mena if one of your salepeople sells my friends apartment she will get charged 2% + 1% of 7.5%? since your not on the IN now what are you arguments for keeping the higher commissions. I know you telesale people are calling all your clients (as mentioned earlier) but as you said it takes time.
I heard (yes gossip) that VIVA done most of the sales on the IN, with the lion share being VIVA properties, but other agency buyers? Is this true? will you still be sharing with other agents? is it feasible with 2% commissions?
Last but not least. My friend has her property on with you at 7.5% (she has not been approached yet regarding lower commissions). In 6 months she has not had a viewing, even though she was told that by going IN the property is more likely to sell because of the 50 agents, etc… Now she either stays at 7.5% but does not have the benefit of the IN, only your 12 or 14 offices or she pays X amount upfront to viva but has to pay a lower commission which is simply added onto what she wants for her property. So the argument is “We could not sell your property before at X amount with 50 agents” but we can now sell it for a drop in commission with 12/4 offices?(hope i’m don’t sound combatitive just curious)
-
wow, this thread has become informative!!
To chris mccarthy, the information has been very interesting. Thanks!A question.
You said you’ve closed down the IN system you use?
Does that mena if one of your salepeople sells my friends apartment she will get charged 2% + 1% of 7.5%? since your not on the IN now what are you arguments for keeping the higher commissions. I know you telesale people are calling all your clients (as mentioned earlier) but as you said it takes time.
I heard (yes gossip) that VIVA done most of the sales on the IN, with the lion share being VIVA properties, but other agency buyers? Is this true? will you still be sharing with other agents? is it feasible with 2% commissions?
Last but not least. My friend has her property on with you at 7.5% (she has not been approached yet regarding lower commissions). In 6 months she has not had a viewing, even though she was told that by going IN the property is more likely to sell because of the 50 agents, etc… Now she either stays at 7.5% but does not have the benefit of the IN, only your 12 or 14 offices or she pays X amount upfront to viva but has to pay a lower commission which is simply added onto what she wants for her property. So the argument is “We could not sell your property before at X amount with 50 agents” but we can now sell it for a drop in commission with 12/4 offices?(hope i’m don’t sound combatitive just curious)
-
-
-
As we all know Estate Agents on the Costa’s have in recent years gained a rather tainted reputation, some by pure ignorance, some by unprofessional conduct, and some through pure greed and exploitation. Is it any wonder therefore that any scheme introduced by any Agent however well thought out and intended is perceived as another con, a gimmick, or both?
Commission levels of 4-5% are not considered by most as excessive, most vendors and buyers recognise the additional marketing costs associated with selling Spanish Properties to a predominantly UK based market.
The issue arises with the levels of professionalism and service offered by some Agents in return for their fees. Many have forgotten that their client the person with whom they have a written contact and obligation is the vendor.
The industry needs to regain the confidence of both vendors and buyers by being honest, transparent, and dependable with rewards coming from their endeavor and effort.
The wind of change is blowing and hopefully one day when someone asks what I do I will be happy to say I am an Estate Agent, without receiving that knowing look and raised eyebrow.
Jim
-
As we all know Estate Agents on the Costa’s have in recent years gained a rather tainted reputation, some by pure ignorance, some by unprofessional conduct, and some through pure greed and exploitation. Is it any wonder therefore that any scheme introduced by any Agent however well thought out and intended is perceived as another con, a gimmick, or both?
Commission levels of 4-5% are not considered by most as excessive, most vendors and buyers recognise the additional marketing costs associated with selling Spanish Properties to a predominantly UK based market.
The issue arises with the levels of professionalism and service offered by some Agents in return for their fees. Many have forgotten that their client the person with whom they have a written contact and obligation is the vendor.
The industry needs to regain the confidence of both vendors and buyers by being honest, transparent, and dependable with rewards coming from their endeavor and effort.
The wind of change is blowing and hopefully one day when someone asks what I do I will be happy to say I am an Estate Agent, without receiving that knowing look and raised eyebrow.
Jim
-
@Flynn wrote:
Thank you Chris for your reply, forgive me if I’m sceptical of your response, as when this happened to me and I challenged one of your IN members as to WHY you should keep half MY holding fee (seller) the agent smugly waved a copy of YOUR contract in my face and told me VIVA keep the rest to cover THEIR inconvienience, and no the failed buyer didn’t see any of his 9000€ back either.
Should you be genuinly serious in your aim to look after clients, my suggestion would be to weed out IN members who deliberately push off plan when bringing clients around to Viva’s resale clients.
I lost 2 potential sales whilst on your books, through this underhand behaviour and was only made wise to it because my IN member office where so angry that they told me the truth.
Hi Flynn,
My apologies for taking a time to come back to you but I have had 24 hours off, looks like that is my summer holidays over!
I understand and accept your sceptism, and this sort of thing is one area of our reasoning to withdraw from the IN Network, I think I explained that it has never been part of our “actual policy” to keep hold of 50% of any reservation deposit, only in extremis have we done so in the past.
We have been quite frankly fed up of this sort of comment coming back to us, made by people who don’t work for us, and don’t follow our practice and yet use the contract to wave in people’s faces. I am sorry you encountered this problem, but in dealing directly with us in future, I am always available and to be advised of client complaints and will be accountable for our actions.
If you believe that we ourselves have actually retained a part of your fee, please do contact me privately and should it transpire that we have then; I will certainly return this to you, but I rather suspect it was the other agent here.
We are genuinely serious, my goodness we couldn’t be more serious in our intent to drop fees to 2% sales commission, and we will now deal alone, with our own clients being vendors and buyers, and will no longer have IN members as you say “pushing off plan” when visiting our vendors properties.
We sell more than 80% resales against new projects, and actually we believe now that figure will grow ever higher, and we also believe that the propensity to lose sales for yourself and for us, will be greatly reduced as a result.
But again and to clarify; we generally don’t keep reservation fees, we follow the contract and return advanced funds, and we no longer are no longer a member of the IN Network.
Thanks
Chris
-
@Flynn wrote:
Thank you Chris for your reply, forgive me if I’m sceptical of your response, as when this happened to me and I challenged one of your IN members as to WHY you should keep half MY holding fee (seller) the agent smugly waved a copy of YOUR contract in my face and told me VIVA keep the rest to cover THEIR inconvienience, and no the failed buyer didn’t see any of his 9000€ back either.
Should you be genuinly serious in your aim to look after clients, my suggestion would be to weed out IN members who deliberately push off plan when bringing clients around to Viva’s resale clients.
I lost 2 potential sales whilst on your books, through this underhand behaviour and was only made wise to it because my IN member office where so angry that they told me the truth.
Hi Flynn,
My apologies for taking a time to come back to you but I have had 24 hours off, looks like that is my summer holidays over!
I understand and accept your sceptism, and this sort of thing is one area of our reasoning to withdraw from the IN Network, I think I explained that it has never been part of our “actual policy” to keep hold of 50% of any reservation deposit, only in extremis have we done so in the past.
We have been quite frankly fed up of this sort of comment coming back to us, made by people who don’t work for us, and don’t follow our practice and yet use the contract to wave in people’s faces. I am sorry you encountered this problem, but in dealing directly with us in future, I am always available and to be advised of client complaints and will be accountable for our actions.
If you believe that we ourselves have actually retained a part of your fee, please do contact me privately and should it transpire that we have then; I will certainly return this to you, but I rather suspect it was the other agent here.
We are genuinely serious, my goodness we couldn’t be more serious in our intent to drop fees to 2% sales commission, and we will now deal alone, with our own clients being vendors and buyers, and will no longer have IN members as you say “pushing off plan” when visiting our vendors properties.
We sell more than 80% resales against new projects, and actually we believe now that figure will grow ever higher, and we also believe that the propensity to lose sales for yourself and for us, will be greatly reduced as a result.
But again and to clarify; we generally don’t keep reservation fees, we follow the contract and return advanced funds, and we no longer are no longer a member of the IN Network.
Thanks
Chris
-
@Qwerty wrote:
@Chris McCarthy wrote:
As to fessing up to what we will pay our property negotiators – our preferred term to salespeople – we will again be entirely open about the facts rather than allow rumour to abound.
Chris,
You being entirely open about the facts is much appreciated.
However, a couple of rumours remain:Is it true that:
– your salespeople have to convert 26 listings per month from MLS to new 2% structure?
– AND do 2 deals per month in order to get the 3000 fixed salary?– and that you have closed the IN MLS down?
Hi Qwerty,
OK, the deal here with me coming into the forum was that I would be entirely open and honest with the facts; to dispel any incorrect rumour, to simply outline or explain transparently, the reasoning behind our philosophy.
I will actually answer your questions, but in future would ask that whilst I will do my very best, everyone should consider that some information goes to our business plan and what we hope will be a competitive advantage in purely business terms. I can’t give you everything, at some point our competitors are going to be all over this forum, and some things I would like to keep up my sleeve!
However, you are almost remarkably well informed.
But the answer is no, our property negotiators will not have to convert 26 listings per month from the MLS to the new structure.
But close, we have given our property negotiators a target to convert 28 of our own current listings to the new 2% structure yet not within any specified time period.
Think about this, we have some 3,500+ listings being vendors to contact and speak to, a significant number to say the least, and in managing this process, and as a quite motivated and up for it group of people, we have indeed set some internal targets for people to get on the phones and make those calls.
I hope that explains that, and you were real close to the truth, but I think you can see; how just being slightly off can set the wrong message in motion along the coast. Furthermore we are only focusing on our own listings, yet would hope that people listed elsewhere would in time see the benefits of contacting us directly.
As to the number of sales per month, and this goes to other questions I have had within the forum, as to why our people, being property negotiators, would work without being highly paid commission only salespeople, then yes they will be expected to perform at a minimum level of two property sales per month.
This level was set in conjunction with the entire team here, it is a performance level that is expected, and for which you will be employed. The interesting thing might be that this level has been a normal level and oft over achieved figure right through our history. We expect it to be much higher in reality in future.
But again, lets think about this, what would the use be to the vendor, the buyer, or ourselves if we actually had people consistently showing properties and not actually selling them?
I think therefore the above two target / goal issues are entirely normal.
As to your final question:
It is not that we ourselves have closed the IN MLS down, we have withdrawn from the IN, and as a result of our being the major contributor to the IN, this company has had to recognise that it is no longer a viable proposition and has ceased trading.
I hope that helps, and to those advisors or mine who say I shouldn’t be on here, I hope that doesn’t give too much of the game away!
Thanks
Chris
-
@Qwerty wrote:
@Chris McCarthy wrote:
As to fessing up to what we will pay our property negotiators – our preferred term to salespeople – we will again be entirely open about the facts rather than allow rumour to abound.
Chris,
You being entirely open about the facts is much appreciated.
However, a couple of rumours remain:Is it true that:
– your salespeople have to convert 26 listings per month from MLS to new 2% structure?
– AND do 2 deals per month in order to get the 3000 fixed salary?– and that you have closed the IN MLS down?
Hi Qwerty,
OK, the deal here with me coming into the forum was that I would be entirely open and honest with the facts; to dispel any incorrect rumour, to simply outline or explain transparently, the reasoning behind our philosophy.
I will actually answer your questions, but in future would ask that whilst I will do my very best, everyone should consider that some information goes to our business plan and what we hope will be a competitive advantage in purely business terms. I can’t give you everything, at some point our competitors are going to be all over this forum, and some things I would like to keep up my sleeve!
However, you are almost remarkably well informed.
But the answer is no, our property negotiators will not have to convert 26 listings per month from the MLS to the new structure.
But close, we have given our property negotiators a target to convert 28 of our own current listings to the new 2% structure yet not within any specified time period.
Think about this, we have some 3,500+ listings being vendors to contact and speak to, a significant number to say the least, and in managing this process, and as a quite motivated and up for it group of people, we have indeed set some internal targets for people to get on the phones and make those calls.
I hope that explains that, and you were real close to the truth, but I think you can see; how just being slightly off can set the wrong message in motion along the coast. Furthermore we are only focusing on our own listings, yet would hope that people listed elsewhere would in time see the benefits of contacting us directly.
As to the number of sales per month, and this goes to other questions I have had within the forum, as to why our people, being property negotiators, would work without being highly paid commission only salespeople, then yes they will be expected to perform at a minimum level of two property sales per month.
This level was set in conjunction with the entire team here, it is a performance level that is expected, and for which you will be employed. The interesting thing might be that this level has been a normal level and oft over achieved figure right through our history. We expect it to be much higher in reality in future.
But again, lets think about this, what would the use be to the vendor, the buyer, or ourselves if we actually had people consistently showing properties and not actually selling them?
I think therefore the above two target / goal issues are entirely normal.
As to your final question:
It is not that we ourselves have closed the IN MLS down, we have withdrawn from the IN, and as a result of our being the major contributor to the IN, this company has had to recognise that it is no longer a viable proposition and has ceased trading.
I hope that helps, and to those advisors or mine who say I shouldn’t be on here, I hope that doesn’t give too much of the game away!
Thanks
Chris
-
Hi Chris,
following on from that last reply, what happens if they don´t hit those targets of 2 per month? and what happens with the commission from the 2 sales, do they get that on top of their 3000 per month salary or do they have to earn a set amount before actually earning commission as well, as from what I can see, 2 sales a month wont bring in that much commission, and if you are paying 3000 basic as well, plus commission – well that will be difficult won´t it?
-
Hi Chris,
following on from that last reply, what happens if they don´t hit those targets of 2 per month? and what happens with the commission from the 2 sales, do they get that on top of their 3000 per month salary or do they have to earn a set amount before actually earning commission as well, as from what I can see, 2 sales a month wont bring in that much commission, and if you are paying 3000 basic as well, plus commission – well that will be difficult won´t it?
-
Hi Chris – I have to say I admire the way you have stuck with us and ‘batted’ every question thrown at you. I know everyone has learnt a lot re. your company’s position now and a lot of rumours have been laid to rest.
Even you have learnt something – compared to your first posting I now understand everything you write 😉You have mentioned your new ‘company model’ several times.
May I ask if this new model of yours will include keeping your ear closer to the ground re. marketing developments that are in an ‘illegal’ situation, waiting court decisions etc.?……from now on?I appreciate the subject of this thread is agents’ fees.
But the continued selling of ‘dodgy’ developments by REA’s – where for example the legality of building licences are in question – is the cause of untold misery and stress, and even financial ruin for some.
As people who regularly read this forum know, one poor English lady caught up in one of the developments by Aifos had a nervous breakdown and ended up committing suicide.Yes, of course it should be our lawyers who look into the legality of a development before allowing a client to sign, but not all do. And as a lot of us know through bitter experience – there are lawyers who are actually ‘in bed’ with these developers.
You wrote in your last answer to me
quote
I would imagine they (the developers) themselves are mortified at the mess that has ensued and I have real difficulty believing they would have anticipated any of these problems.
unquoteAm afraid Chris, when a developer applies for a building licence knowing it is for an area that goes against the Junta’s PGOU plan, (the original building licence was for 12 individual houses, not 12 blocks of apartments and they knew that very well) they may well be ‘mortified’ at the mess they are now in, but in no way could they have not ‘anticipated’ that one day, the doo-doos could/would/may possibly hit the proverbial fan.
Surely there has to be some responsibility shouldered by agents when they market something, whatever the product.
If I set up an agency selling/advertising dodgy gas cookers and one day inevitably one blew up in someone’s face, surely I would in part be responsible?As there are dozens and dozens of readers of this forum in the same position as I found myself in with Green Hills, just interested to know your position on this point, and whether it will be considered in your new business model.
Barbara
-
Hi Chris – I have to say I admire the way you have stuck with us and ‘batted’ every question thrown at you. I know everyone has learnt a lot re. your company’s position now and a lot of rumours have been laid to rest.
Even you have learnt something – compared to your first posting I now understand everything you write 😉You have mentioned your new ‘company model’ several times.
May I ask if this new model of yours will include keeping your ear closer to the ground re. marketing developments that are in an ‘illegal’ situation, waiting court decisions etc.?……from now on?I appreciate the subject of this thread is agents’ fees.
But the continued selling of ‘dodgy’ developments by REA’s – where for example the legality of building licences are in question – is the cause of untold misery and stress, and even financial ruin for some.
As people who regularly read this forum know, one poor English lady caught up in one of the developments by Aifos had a nervous breakdown and ended up committing suicide.Yes, of course it should be our lawyers who look into the legality of a development before allowing a client to sign, but not all do. And as a lot of us know through bitter experience – there are lawyers who are actually ‘in bed’ with these developers.
You wrote in your last answer to me
quote
I would imagine they (the developers) themselves are mortified at the mess that has ensued and I have real difficulty believing they would have anticipated any of these problems.
unquoteAm afraid Chris, when a developer applies for a building licence knowing it is for an area that goes against the Junta’s PGOU plan, (the original building licence was for 12 individual houses, not 12 blocks of apartments and they knew that very well) they may well be ‘mortified’ at the mess they are now in, but in no way could they have not ‘anticipated’ that one day, the doo-doos could/would/may possibly hit the proverbial fan.
Surely there has to be some responsibility shouldered by agents when they market something, whatever the product.
If I set up an agency selling/advertising dodgy gas cookers and one day inevitably one blew up in someone’s face, surely I would in part be responsible?As there are dozens and dozens of readers of this forum in the same position as I found myself in with Green Hills, just interested to know your position on this point, and whether it will be considered in your new business model.
Barbara
-
Hi Chris,
at last the power has been returned to the vendors. I shall quickly organize a Vendors Meeting Association on the CDS in order to cash in myself concerning the current situation. With some agents selling at 10, 7,5 or 5%and you at 3%, it is time that vendors are able to sell for more. My association shall advice and on sale of the property undertaken by VIVA, we should get paid a percentage of the difference. With other words: 350.000 net at 3% or 300.000 net at 7.5% for the sale of the same property in two different agencies should be professionally adviced by my new Association, for this we charge.
Thank you Chris, I shall spin along on my idea…….just need to advertise in the SUR in English……..but you tell me please, what has happened to all these long established business relationships…..we cannot be friends any longer? Is it all one against all and all against one from now? 😯 -
Hi Chris,
at last the power has been returned to the vendors. I shall quickly organize a Vendors Meeting Association on the CDS in order to cash in myself concerning the current situation. With some agents selling at 10, 7,5 or 5%and you at 3%, it is time that vendors are able to sell for more. My association shall advice and on sale of the property undertaken by VIVA, we should get paid a percentage of the difference. With other words: 350.000 net at 3% or 300.000 net at 7.5% for the sale of the same property in two different agencies should be professionally adviced by my new Association, for this we charge.
Thank you Chris, I shall spin along on my idea…….just need to advertise in the SUR in English……..but you tell me please, what has happened to all these long established business relationships…..we cannot be friends any longer? Is it all one against all and all against one from now? 😯 -
-
-
-
-
Hola Barbara,
Very well said. Thoroughly agree with your remarks. It is simply unacceptable for agents to duck any responsibility for the illegality of certain developments with the claim that their function is only to match buyers and sellers. It is no wonder so many people are totally disgusted by the way they act.
Any serious “business model” should have at its heart the need to act in an honest and informed manner. Too many are just like dating agencies although it must be said you have a better chance of a bit of fun from dealing with a dating agency than with many real estate intermediaries.
Any agent worth his salt should have known the “planning” status of what they were selling. They should also have known the good developers from the bad. Sadly, the sale of real estate has become totally commission driven. The agents have been in it solely for themselves. I would argue,and will not be deflected from this view, that buyers should be entitled to a much higher level of professionalism from all involved in the selling process.
Also I am not sure I buy into the argument of higher marketing costs justifying higher commissions. You can be sure that the large agencies get whacking discounts from the publications as well as “friendly” editorial coverage.
But, if Chris’s firm are serious in their intention to reduce commissions to sensible levels and return a huge chunk of equity back to its rightful owners, then the market should become a fairer place. For far too long agents have been earning “developers profit” which is quite distinct from a sales commission based on the sales price.
It will be interesting to see how things evolve. Let me just finish by saying I know there are honest brokers out there. Let’s hope they now multiply in numbers!
Saludos,
James
-
Hola Barbara,
Very well said. Thoroughly agree with your remarks. It is simply unacceptable for agents to duck any responsibility for the illegality of certain developments with the claim that their function is only to match buyers and sellers. It is no wonder so many people are totally disgusted by the way they act.
Any serious “business model” should have at its heart the need to act in an honest and informed manner. Too many are just like dating agencies although it must be said you have a better chance of a bit of fun from dealing with a dating agency than with many real estate intermediaries.
Any agent worth his salt should have known the “planning” status of what they were selling. They should also have known the good developers from the bad. Sadly, the sale of real estate has become totally commission driven. The agents have been in it solely for themselves. I would argue,and will not be deflected from this view, that buyers should be entitled to a much higher level of professionalism from all involved in the selling process.
Also I am not sure I buy into the argument of higher marketing costs justifying higher commissions. You can be sure that the large agencies get whacking discounts from the publications as well as “friendly” editorial coverage.
But, if Chris’s firm are serious in their intention to reduce commissions to sensible levels and return a huge chunk of equity back to its rightful owners, then the market should become a fairer place. For far too long agents have been earning “developers profit” which is quite distinct from a sales commission based on the sales price.
It will be interesting to see how things evolve. Let me just finish by saying I know there are honest brokers out there. Let’s hope they now multiply in numbers!
Saludos,
James
-
James,
it is so easy to understand. Vendors were willing to go down with their net so far due to the fact that the charge of 7.5% applied by the Interagency Network will sell their property faster since the property has been seen and advertised by all IN members. This service cost money, though not an exclusivity, did convince many vendors to charge less than they originally set out to receive. Obviously their property did not sell fast. Also, it has been seen that their net price was different in non-IN agents.
I set out to act as someone like a broker who would advice vendors of where to list their properties and also to charge for it. My vast experience and respect gained in this market over the past years should make a quite a bit of money out of the present situation. Until everybody charges 3% I should be in for business. If due to my research and advice a property sells quicker and for more money for the vendor I shall get reimbursed. I think this is the greatest that has happened on this coast for a long time. Already I have clients who would like to list and pay me money if I have been successful in selling their property faster.
Do you understand me now a bit better, James? 🙄 -
James,
it is so easy to understand. Vendors were willing to go down with their net so far due to the fact that the charge of 7.5% applied by the Interagency Network will sell their property faster since the property has been seen and advertised by all IN members. This service cost money, though not an exclusivity, did convince many vendors to charge less than they originally set out to receive. Obviously their property did not sell fast. Also, it has been seen that their net price was different in non-IN agents.
I set out to act as someone like a broker who would advice vendors of where to list their properties and also to charge for it. My vast experience and respect gained in this market over the past years should make a quite a bit of money out of the present situation. Until everybody charges 3% I should be in for business. If due to my research and advice a property sells quicker and for more money for the vendor I shall get reimbursed. I think this is the greatest that has happened on this coast for a long time. Already I have clients who would like to list and pay me money if I have been successful in selling their property faster.
Do you understand me now a bit better, James? 🙄 -
Chris McCarthy wrote:We are genuinely serious, my goodness we couldn’t be more serious in our intent to drop fees to 2% sales commission, and we will now deal alone, with our own clients being vendors and buyers, and will no longer have IN members as you say “pushing off plan” when visiting our vendors properties.
We sell more than 80% resales against new projects, and actually we believe now that figure will grow ever higher, and we also believe that the propensity to lose sales for yourself and for us, will be greatly reduced as a result.
But again and to clarify; we generally don’t keep reservation fees, we follow the contract and return advanced funds, and we no longer are no longer a member of the IN Network.
Thanks
Chris
I’m confused. A majority of your sales are resales? In that case would it not make more sense, as the majority shareholder to reformate the IN and work with other agents than to simply drop the system? I mean instead of all those different commission rates of the IN, just change it to 4 or 5%?
-
Chris McCarthy wrote:We are genuinely serious, my goodness we couldn’t be more serious in our intent to drop fees to 2% sales commission, and we will now deal alone, with our own clients being vendors and buyers, and will no longer have IN members as you say “pushing off plan” when visiting our vendors properties.
We sell more than 80% resales against new projects, and actually we believe now that figure will grow ever higher, and we also believe that the propensity to lose sales for yourself and for us, will be greatly reduced as a result.
But again and to clarify; we generally don’t keep reservation fees, we follow the contract and return advanced funds, and we no longer are no longer a member of the IN Network.
Thanks
Chris
I’m confused. A majority of your sales are resales? In that case would it not make more sense, as the majority shareholder to reformate the IN and work with other agents than to simply drop the system? I mean instead of all those different commission rates of the IN, just change it to 4 or 5%?
-
I don’t care what commission the sales people (or negotiators) will be paid as I am not one.
Vendors who are already on Viva’s listings (and many have been for sometime) will ask themselves what difference paying a deposit to viva will make, when they couldn’t manage to get them a sale before. Most would drop their price anyway if they had ever got a serious offer.I mailed my daughter and told her to read this and her response was (well the polite bit) can you have a look around for some other agents as they won’t be getting any money from me.
I think one of the reasons why sales are so slow is that many just don’t want to come here anymore, the loads of third world looking blocks are ugly. I have several friends who have this year decided to sell-up and move out of spain. Viva reducing their commission isn’t going to put people on a spending frenzy.
-
I don’t care what commission the sales people (or negotiators) will be paid as I am not one.
Vendors who are already on Viva’s listings (and many have been for sometime) will ask themselves what difference paying a deposit to viva will make, when they couldn’t manage to get them a sale before. Most would drop their price anyway if they had ever got a serious offer.I mailed my daughter and told her to read this and her response was (well the polite bit) can you have a look around for some other agents as they won’t be getting any money from me.
I think one of the reasons why sales are so slow is that many just don’t want to come here anymore, the loads of third world looking blocks are ugly. I have several friends who have this year decided to sell-up and move out of spain. Viva reducing their commission isn’t going to put people on a spending frenzy.
-
katy wrote:I don’t care what commission the sales people (or negotiators) will be paid as I am not one.
Vendors who are already on Viva’s listings (and many have been for sometime) will ask themselves what difference paying a deposit to viva will make, when they couldn’t manage to get them a sale before. Most would drop their price anyway if they had ever got a serious offer.I mailed my daughter and told her to read this and her response was (well the polite bit) can you have a look around for some other agents as they won’t be getting any money from me.
I think one of the reasons why sales are so slow is that many just don’t want to come here anymore, the loads of third world looking blocks are ugly. I have several friends who have this year decided to sell-up and move out of spain. Viva reducing their commission isn’t going to put people on a spending frenzy.
amen!
what we need is professional service + accountability. -
katy wrote:I don’t care what commission the sales people (or negotiators) will be paid as I am not one.
Vendors who are already on Viva’s listings (and many have been for sometime) will ask themselves what difference paying a deposit to viva will make, when they couldn’t manage to get them a sale before. Most would drop their price anyway if they had ever got a serious offer.I mailed my daughter and told her to read this and her response was (well the polite bit) can you have a look around for some other agents as they won’t be getting any money from me.
I think one of the reasons why sales are so slow is that many just don’t want to come here anymore, the loads of third world looking blocks are ugly. I have several friends who have this year decided to sell-up and move out of spain. Viva reducing their commission isn’t going to put people on a spending frenzy.
amen!
what we need is professional service + accountability. -
-
-
@katy wrote:
So, in my daughters case she would have to pay Viva 1400 euros for them to market a property already on their listings. Viva have only brought 6 potential clients in a year and two of these were from other agents in the network. probably better using the money for private advertising.
Hi Katy,
Sorry if I have not perhaps explained this before, but there is actually a limit on our conveyancing deposit of €1,000 we will not take more than this if the property is valued at over €500,000.
In terms of the number of viewings any vendor has, I refer to my earlier point about property selling at the right price, and this is one of things we absolutely hope to be able achieve in future. To set prices as near as can be, to that which the vendor will receive, and if a vendor can be both reasonable and price point sensitive to the market, then a potential buyer should see that property is more affordable and or achievable.
I wrote some more here but have deleted it, because I am very worried that I am going to start sounding like a salesman or becoming promotional, so I agree if your daughter feels that she can get 6 viewings and a sale for a private spend of €1,000 she should go ahead and spend the money there.
But please let me say, that if she has given me the €1,000 then it will have become a conveyancing fee deposit of 20%, paid in advance and not lost in advertising; our proposition here, is this not an upfront listing fee, it is for us to do the conveyancing which we would complete for her in the event of any private sale.
I hope that answers the questions. And I do hope your daughter sells her property one way or the other.
Chris
-
@katy wrote:
So, in my daughters case she would have to pay Viva 1400 euros for them to market a property already on their listings. Viva have only brought 6 potential clients in a year and two of these were from other agents in the network. probably better using the money for private advertising.
Hi Katy,
Sorry if I have not perhaps explained this before, but there is actually a limit on our conveyancing deposit of €1,000 we will not take more than this if the property is valued at over €500,000.
In terms of the number of viewings any vendor has, I refer to my earlier point about property selling at the right price, and this is one of things we absolutely hope to be able achieve in future. To set prices as near as can be, to that which the vendor will receive, and if a vendor can be both reasonable and price point sensitive to the market, then a potential buyer should see that property is more affordable and or achievable.
I wrote some more here but have deleted it, because I am very worried that I am going to start sounding like a salesman or becoming promotional, so I agree if your daughter feels that she can get 6 viewings and a sale for a private spend of €1,000 she should go ahead and spend the money there.
But please let me say, that if she has given me the €1,000 then it will have become a conveyancing fee deposit of 20%, paid in advance and not lost in advertising; our proposition here, is this not an upfront listing fee, it is for us to do the conveyancing which we would complete for her in the event of any private sale.
I hope that answers the questions. And I do hope your daughter sells her property one way or the other.
Chris
-
I know everyone thinks that there house is probably worth more, but she priced it at 35000 less than your valuation and another agent must have identified it as a good buy as they featured it a a virtual tour (free) but, still no punters. Just an example, think that everyone wants to pick up something for less than 100,000 at present (thanks to all the TV programmes).
The last time I sold with Viva I was very impressed (it was 4 years ago). when the property went on sale around 8 negotiators came to view the property and it really made me think thet they were on our case and that they were hungry, now they all seem a bit defeatist and I have had the experience of one who came with a client and never said a word, just lef it to me.
-
I know everyone thinks that there house is probably worth more, but she priced it at 35000 less than your valuation and another agent must have identified it as a good buy as they featured it a a virtual tour (free) but, still no punters. Just an example, think that everyone wants to pick up something for less than 100,000 at present (thanks to all the TV programmes).
The last time I sold with Viva I was very impressed (it was 4 years ago). when the property went on sale around 8 negotiators came to view the property and it really made me think thet they were on our case and that they were hungry, now they all seem a bit defeatist and I have had the experience of one who came with a client and never said a word, just lef it to me.
-
@Joe wrote:
Hi Chris,
I have a couple of questions.
Earlier in one of your threads, you pointed out that U.K agents operate on 1.5% commission, and must be profitable at that to survive, hence one of your reasons for reducing the commission.
My questions are these:
On this level of commission, how can you expect to fund Inspection visits, exhibitions, marketing campaigns etc to sell the resales? These are all things that U.K agents do not do, hence the commission rate is lower.
Also how are you going to employ good sales people on much lower commissions? You cannot fund large basic salaries with these commissions either. What would your package be?
Will this not just lead to the sales people only selling developments, in order to earn more. In fact this may be internally driven, to help you balance things out.
I do not see this as a sustainable rate, as this market is not like the U.K market, where buyers drive along a street and see a for sale board and just ring that agent.
Your comments would be welcome
Joe[/i]
Hi Joe,
OK here goes to these questions…
We will not fund inspection visits, for some time now we have not done so, and actually we regret ever having done so. For many years we never offered any inspection visit incentive, and it always worked for us. We explained thus:
The plain and simple fact is, there is no such thing as a free lunch, and the fact is clients end up paying the price. What we will do however, is offer greatly discounted accommodation, car hire and a flight booking advice service. Then let the client be free to visit where they will.
I think you have to trust that we have, as partially stated elsewhere, co-marketing agreements with developers, advertisers and other collaborators through vehicles such as our magazine, exhibitions and other routes to market, which will not only allow us to continue our marketing, but expand this once more.
Don’t worry about our ability to market and sell, the real fact is that we have sold literally thousands of properties here, and we continue to do so in considerable numbers this very week, and we will be able to balance our books, yet I am sure you will appreciate I can’t give all of our game plan away.
We can fund our salary packages and offer reasonable benefits with added bonuses.
The math here is private, but once again, I can refer you to our public accounts and the fact that we are annually audited by KPMG, please also consider that maybe our business is not like many others here.
I would venture with our office spread, with our brand presence, with our HQ infrastructure and our prudent financial planning and continual reinvestment of profits in our business over 8 years, we are a much different proposition than most people suppose or surmise, given perhaps the other types of agency that people encounter.
We will always offer developments, because frankly some of them are excellent and provide exactly what a client is looking for and what works best for them. Yet our product mix and marketing is heavily biased toward resales, our property negotiators are required to make a certain number of sales with no distinction between resale or development, and because we: a) have many more resales than any other agents and b) most clients actually want a resale, then we have a natural balance of sales, we don’t believe hard selling toward developments will become our bent, it just wouldn’t work.
Oh, and our package as the Qwerty post neared the mark, will be a basic gross of €3,000 per month, with car and bonus commissions. These packages are being introduced over the next couple of months. But you will be required to perform to a high level. Not that you personally are looking for a job here!
A reasonable above average performer will earn around €63,000 gross and we think that to be a good incentive to work here, but if someone wants to earn more; they will certainly be able to do so, and they will earn it.
As to the sustainable rate, it is an old argument that it is not like the UK here, and you are right, people don’t just drive along the street and call the agent. Why?
Simple. The agent here would be taking way too much money and equity from the property, and the local client knows this, and won’t buy through an agent, we will make it not only viable and possible for the local client to buy through us, we will deliver for that buyer a full buying and mortgage service with added value through our property negotiation skills, to turn this market into a similar model to the UK, and one day, may even be able to reduce our rates further.
You know, they said Easyjet and Ryanair would never be able to compete with British Airways, and look what happened there.
Good questions, I just hope I am not starting to bore people by now.
Chris
-
@Joe wrote:
Hi Chris,
I have a couple of questions.
Earlier in one of your threads, you pointed out that U.K agents operate on 1.5% commission, and must be profitable at that to survive, hence one of your reasons for reducing the commission.
My questions are these:
On this level of commission, how can you expect to fund Inspection visits, exhibitions, marketing campaigns etc to sell the resales? These are all things that U.K agents do not do, hence the commission rate is lower.
Also how are you going to employ good sales people on much lower commissions? You cannot fund large basic salaries with these commissions either. What would your package be?
Will this not just lead to the sales people only selling developments, in order to earn more. In fact this may be internally driven, to help you balance things out.
I do not see this as a sustainable rate, as this market is not like the U.K market, where buyers drive along a street and see a for sale board and just ring that agent.
Your comments would be welcome
Joe[/i]
Hi Joe,
OK here goes to these questions…
We will not fund inspection visits, for some time now we have not done so, and actually we regret ever having done so. For many years we never offered any inspection visit incentive, and it always worked for us. We explained thus:
The plain and simple fact is, there is no such thing as a free lunch, and the fact is clients end up paying the price. What we will do however, is offer greatly discounted accommodation, car hire and a flight booking advice service. Then let the client be free to visit where they will.
I think you have to trust that we have, as partially stated elsewhere, co-marketing agreements with developers, advertisers and other collaborators through vehicles such as our magazine, exhibitions and other routes to market, which will not only allow us to continue our marketing, but expand this once more.
Don’t worry about our ability to market and sell, the real fact is that we have sold literally thousands of properties here, and we continue to do so in considerable numbers this very week, and we will be able to balance our books, yet I am sure you will appreciate I can’t give all of our game plan away.
We can fund our salary packages and offer reasonable benefits with added bonuses.
The math here is private, but once again, I can refer you to our public accounts and the fact that we are annually audited by KPMG, please also consider that maybe our business is not like many others here.
I would venture with our office spread, with our brand presence, with our HQ infrastructure and our prudent financial planning and continual reinvestment of profits in our business over 8 years, we are a much different proposition than most people suppose or surmise, given perhaps the other types of agency that people encounter.
We will always offer developments, because frankly some of them are excellent and provide exactly what a client is looking for and what works best for them. Yet our product mix and marketing is heavily biased toward resales, our property negotiators are required to make a certain number of sales with no distinction between resale or development, and because we: a) have many more resales than any other agents and b) most clients actually want a resale, then we have a natural balance of sales, we don’t believe hard selling toward developments will become our bent, it just wouldn’t work.
Oh, and our package as the Qwerty post neared the mark, will be a basic gross of €3,000 per month, with car and bonus commissions. These packages are being introduced over the next couple of months. But you will be required to perform to a high level. Not that you personally are looking for a job here!
A reasonable above average performer will earn around €63,000 gross and we think that to be a good incentive to work here, but if someone wants to earn more; they will certainly be able to do so, and they will earn it.
As to the sustainable rate, it is an old argument that it is not like the UK here, and you are right, people don’t just drive along the street and call the agent. Why?
Simple. The agent here would be taking way too much money and equity from the property, and the local client knows this, and won’t buy through an agent, we will make it not only viable and possible for the local client to buy through us, we will deliver for that buyer a full buying and mortgage service with added value through our property negotiation skills, to turn this market into a similar model to the UK, and one day, may even be able to reduce our rates further.
You know, they said Easyjet and Ryanair would never be able to compete with British Airways, and look what happened there.
Good questions, I just hope I am not starting to bore people by now.
Chris
-
@Claire wrote:
Perhaps you REA’s could communicate via PM’s on this forum or exchange email addresses! Just a thought 😉
Hi Claire,
You might be right, I have been working my way through these responses and questions over a couple of days and have only just got here.
It might be soon that I have exhausted all the questions and answers I can give, and that there is a natural end.
I hope I haven’t clogged up the system too much and may get through the later posts with shorter posts if able.
In truth, I recognise I am probably wearing a bit thin now. However, my private e-mail address is availabe to anyone that wants it now or for the future.
Thanks
Chris
-
@Claire wrote:
Perhaps you REA’s could communicate via PM’s on this forum or exchange email addresses! Just a thought 😉
Hi Claire,
You might be right, I have been working my way through these responses and questions over a couple of days and have only just got here.
It might be soon that I have exhausted all the questions and answers I can give, and that there is a natural end.
I hope I haven’t clogged up the system too much and may get through the later posts with shorter posts if able.
In truth, I recognise I am probably wearing a bit thin now. However, my private e-mail address is availabe to anyone that wants it now or for the future.
Thanks
Chris
-
@karenmcc wrote:
Sorry Claire but I for one am very interested in what is happening. This is an important change which will affect the way properties are bought/sold and effectively bring prices down. A lot of companies will be forced to follow suit. If companies are pushed out of business it could have a knock-on effect regarding unemployment….remember that long-term tenant you may be targeting – if he’s unemployed he’ll be looking for a cheaper rental……
Personally I think it’s great news, as a resident on the Costa del Sol property prices/rentals are spiralling out of reach of the local market with a large chunk of the cost being eaten up by commissions of one sort or another. For those of us not earning commissions the average wage is around 1000 euros a month so getting on the property ladder remains a dream for many of the resident population.
If sale prices are cut due to reduced commissions then this represents a better deal for the buyer yet without any change to the vendor’s nett figure. This may be exactly what’s needed to help the market pick up from it’s current slump.
Hi Karenmcc,
Thanks for your positive comments; they are a real boost to me, because this is the way we look at things.
I would add that a parallel issue to vendor benefits and a major advantage we see is of that to the buyer. And not previously covered in my previous posts.
We are often asked the question by a buyer: “What happens if I want to sell in twelve months time?” In the past we would have had to respond with the fact that your purchase price today must have added to it at least 10% in costs (without reference to government taxes or duties) to achieve a basic return on your monies.
Inevitably therefore, we take a large chunk of the vendor’s equity upon sale, and an equally large chunk of buyers equity upon resale, we ended up the clear and only winners here.
Now, Karen, yes we may be able to help you buy a property that is 10% cheaper than yesterday, and may be able to help you move up and progress through the ladder in future. And we won’t be looking for another 10% upon your exit. This is one of our goals, and a significant part of our plan to achieve repeat business and obtain good referral business also.
It is genuinely about trying to deliver a win/win scenario and removing ourselves from being a real barrier to entry and exit of property ownership.
Thanks for the comment and the support for our proposition.
Chris
-
@karenmcc wrote:
Sorry Claire but I for one am very interested in what is happening. This is an important change which will affect the way properties are bought/sold and effectively bring prices down. A lot of companies will be forced to follow suit. If companies are pushed out of business it could have a knock-on effect regarding unemployment….remember that long-term tenant you may be targeting – if he’s unemployed he’ll be looking for a cheaper rental……
Personally I think it’s great news, as a resident on the Costa del Sol property prices/rentals are spiralling out of reach of the local market with a large chunk of the cost being eaten up by commissions of one sort or another. For those of us not earning commissions the average wage is around 1000 euros a month so getting on the property ladder remains a dream for many of the resident population.
If sale prices are cut due to reduced commissions then this represents a better deal for the buyer yet without any change to the vendor’s nett figure. This may be exactly what’s needed to help the market pick up from it’s current slump.
Hi Karenmcc,
Thanks for your positive comments; they are a real boost to me, because this is the way we look at things.
I would add that a parallel issue to vendor benefits and a major advantage we see is of that to the buyer. And not previously covered in my previous posts.
We are often asked the question by a buyer: “What happens if I want to sell in twelve months time?” In the past we would have had to respond with the fact that your purchase price today must have added to it at least 10% in costs (without reference to government taxes or duties) to achieve a basic return on your monies.
Inevitably therefore, we take a large chunk of the vendor’s equity upon sale, and an equally large chunk of buyers equity upon resale, we ended up the clear and only winners here.
Now, Karen, yes we may be able to help you buy a property that is 10% cheaper than yesterday, and may be able to help you move up and progress through the ladder in future. And we won’t be looking for another 10% upon your exit. This is one of our goals, and a significant part of our plan to achieve repeat business and obtain good referral business also.
It is genuinely about trying to deliver a win/win scenario and removing ourselves from being a real barrier to entry and exit of property ownership.
Thanks for the comment and the support for our proposition.
Chris
-
@T5golfer wrote:
I must say a thankyou for you time and effort in supplying your answers.I realise how busy you must be at this time.
I hope it does work for you, and as stated previously I welcome the change.
We have managed to sell property on the CDS without over the top commissions, and without being part of a MLS, very successfully and I know that the clients are very happy buying property cheaper than they can find it elsewhere or through MLS agents.
However one final query, do the clients listing their property with you at 2% with the upfront fee, have to sign an exclusive contract with you for any period of time or are they free to list said property with other agents??
Dear Tsgolfer,
Thanks for the comment, and likewise I wish you every and continued success in your business. From your previous post, it sounds like you have a sound practice and philosophy,
In direct and simple answer to your query about exclusivity, the answer is no. Nobody has to sign an exclusive contract with ourselves, they are indeed free to list with you or whomsoever else they choose.
This answer has suprised some people when outlined elsewhere, however the simple fact is, we want vendors primarily to be able to sell their property. And if you have the client, they should be able to do so.
Thanks
Chris
-
@T5golfer wrote:
I must say a thankyou for you time and effort in supplying your answers.I realise how busy you must be at this time.
I hope it does work for you, and as stated previously I welcome the change.
We have managed to sell property on the CDS without over the top commissions, and without being part of a MLS, very successfully and I know that the clients are very happy buying property cheaper than they can find it elsewhere or through MLS agents.
However one final query, do the clients listing their property with you at 2% with the upfront fee, have to sign an exclusive contract with you for any period of time or are they free to list said property with other agents??
Dear Tsgolfer,
Thanks for the comment, and likewise I wish you every and continued success in your business. From your previous post, it sounds like you have a sound practice and philosophy,
In direct and simple answer to your query about exclusivity, the answer is no. Nobody has to sign an exclusive contract with ourselves, they are indeed free to list with you or whomsoever else they choose.
This answer has suprised some people when outlined elsewhere, however the simple fact is, we want vendors primarily to be able to sell their property. And if you have the client, they should be able to do so.
Thanks
Chris
-
@karenmcc wrote:
Just a couple of questions…….With regard to the upfront conveyancing fee……what happens to this money if the property does not sell at all through any route – is there a refund after a stipulated period?
Also, for a potential buyer browsing the V website how do you distinguish between those properties which are priced with 2% and those which have the higher 7.5% 😕 ?
Dear Karenmcc,
I think I touched on this in an earlier post to Katy, but there have been so many now I can’t be fully sure.
The conveyancing deposit is non-refundable, we are all assuming that you are going to sell the property, we begin that process for you immediately, and we and you will do everything possible to achieve that goal, so it is a deposit against our time, effort and work on your behalf.
However whilst there is no time period for a return, nor is there a time period for your success, if it takes a year then we are still here and ready to do your conveyancing, taking into account the deposit you have paid.
We hope one element of advantage to buyers here, is that they will appreciate that the vendor that has paid their conveyancing deposit, and has made a real commitment to the sale process, and therefore that listing is a real and active seller, looking for a buyer, not speculating and chancing their arm.
As to the website, as previously stated we are now contacting and re-listing all of our vendors – one by one – if a vendor does not want to move to 2% then we will remove them from our website, we do not want any confusion between 2% and 7.5% for any longer than is necessary or inevitable.
If as yet un-contacted, and we make an arrangement to view with a client, and because our property negotiators have personal re-listing targets to hit, a vendor will (or goodness help the property negotiator) be offered the opportunity to re-list in advance of the viewing.
Quite frankly, and honestly, there may be the odd hiccup here but we will do our best to avoid this, as some people may say no, but we are duty bound to show the property to the buyer, however that will be the last buyer we show to that property.
Good question, thanks.
Chris
-
@karenmcc wrote:
Just a couple of questions…….With regard to the upfront conveyancing fee……what happens to this money if the property does not sell at all through any route – is there a refund after a stipulated period?
Also, for a potential buyer browsing the V website how do you distinguish between those properties which are priced with 2% and those which have the higher 7.5% 😕 ?
Dear Karenmcc,
I think I touched on this in an earlier post to Katy, but there have been so many now I can’t be fully sure.
The conveyancing deposit is non-refundable, we are all assuming that you are going to sell the property, we begin that process for you immediately, and we and you will do everything possible to achieve that goal, so it is a deposit against our time, effort and work on your behalf.
However whilst there is no time period for a return, nor is there a time period for your success, if it takes a year then we are still here and ready to do your conveyancing, taking into account the deposit you have paid.
We hope one element of advantage to buyers here, is that they will appreciate that the vendor that has paid their conveyancing deposit, and has made a real commitment to the sale process, and therefore that listing is a real and active seller, looking for a buyer, not speculating and chancing their arm.
As to the website, as previously stated we are now contacting and re-listing all of our vendors – one by one – if a vendor does not want to move to 2% then we will remove them from our website, we do not want any confusion between 2% and 7.5% for any longer than is necessary or inevitable.
If as yet un-contacted, and we make an arrangement to view with a client, and because our property negotiators have personal re-listing targets to hit, a vendor will (or goodness help the property negotiator) be offered the opportunity to re-list in advance of the viewing.
Quite frankly, and honestly, there may be the odd hiccup here but we will do our best to avoid this, as some people may say no, but we are duty bound to show the property to the buyer, however that will be the last buyer we show to that property.
Good question, thanks.
Chris
-
-
-
-
-
-
-
@Fuengi wrote:
wow, this thread has become informative!!
To chris mccarthy, the information has been very interesting. Thanks!A question.
You said you’ve closed down the IN system you use?
Does that mena if one of your salepeople sells my friends apartment she will get charged 2% + 1% of 7.5%? since your not on the IN now what are you arguments for keeping the higher commissions. I know you telesale people are calling all your clients (as mentioned earlier) but as you said it takes time.
I heard (yes gossip) that VIVA done most of the sales on the IN, with the lion share being VIVA properties, but other agency buyers? Is this true? will you still be sharing with other agents? is it feasible with 2% commissions?
Last but not least. My friend has her property on with you at 7.5% (she has not been approached yet regarding lower commissions). In 6 months she has not had a viewing, even though she was told that by going IN the property is more likely to sell because of the 50 agents, etc… Now she either stays at 7.5% but does not have the benefit of the IN, only your 12 or 14 offices or she pays X amount upfront to viva but has to pay a lower commission which is simply added onto what she wants for her property. So the argument is “We could not sell your property before at X amount with 50 agents” but we can now sell it for a drop in commission with 12/4 offices?(hope i’m don’t sound combatitive just curious)
Dear Fuengi,
I am glad the information has been very interesting, and I am very grateful that everyone has been so open in return and prepared to try and understand our proposition.
I think I posted my first mail on Monday, and have tried to respond to everyone in turn across each day and before I know it, here I still am on Friday.
I think I have by and large covered almost every issue, I propose to answer each mail that is addressed to me up until today, as now a number of mails are naturally posts between others, and the debate more general.
Then, I think I had best get back to my day job next week, and will make a final post hopefully by the end of today or tomorrow.
But to your questions…
We will not be keeping the higher rate of commissions, please have your friend contact us and if she wants to re-list then we will do so.
I think it is true to say that our company did most of the sales on the IN, about 65% of the volume I believe. We will not per se be sharing with other agents in the future, we will list and promote our own vendors properties.
The real truth here is that an agent supposedly sharing properties does not work. Take a look at Flynn’s comments about how some agents use other agent’s properties to burn resales and sell new developments even to the point of doing so in front of the vendor. And sadly, we have many more reasons as to why it simply does not benefit the vendor or the buyer to have agents sharing.
If your friend had no viewings in six months, then that would be distressing, as it has been for Katy’s daughter, we are selling properties every single day and right now in numbers akin to our better years, we don’t need to work with 50 other agents to sell a property, as I said there are many reasons why this does not work, but that is probably a separate issue.
Hopefully that helps, and I can spend a bit more time today to go through the final posts and as I said get back to the day job.
Thanks
Chris
-
@Fuengi wrote:
wow, this thread has become informative!!
To chris mccarthy, the information has been very interesting. Thanks!A question.
You said you’ve closed down the IN system you use?
Does that mena if one of your salepeople sells my friends apartment she will get charged 2% + 1% of 7.5%? since your not on the IN now what are you arguments for keeping the higher commissions. I know you telesale people are calling all your clients (as mentioned earlier) but as you said it takes time.
I heard (yes gossip) that VIVA done most of the sales on the IN, with the lion share being VIVA properties, but other agency buyers? Is this true? will you still be sharing with other agents? is it feasible with 2% commissions?
Last but not least. My friend has her property on with you at 7.5% (she has not been approached yet regarding lower commissions). In 6 months she has not had a viewing, even though she was told that by going IN the property is more likely to sell because of the 50 agents, etc… Now she either stays at 7.5% but does not have the benefit of the IN, only your 12 or 14 offices or she pays X amount upfront to viva but has to pay a lower commission which is simply added onto what she wants for her property. So the argument is “We could not sell your property before at X amount with 50 agents” but we can now sell it for a drop in commission with 12/4 offices?(hope i’m don’t sound combatitive just curious)
Dear Fuengi,
I am glad the information has been very interesting, and I am very grateful that everyone has been so open in return and prepared to try and understand our proposition.
I think I posted my first mail on Monday, and have tried to respond to everyone in turn across each day and before I know it, here I still am on Friday.
I think I have by and large covered almost every issue, I propose to answer each mail that is addressed to me up until today, as now a number of mails are naturally posts between others, and the debate more general.
Then, I think I had best get back to my day job next week, and will make a final post hopefully by the end of today or tomorrow.
But to your questions…
We will not be keeping the higher rate of commissions, please have your friend contact us and if she wants to re-list then we will do so.
I think it is true to say that our company did most of the sales on the IN, about 65% of the volume I believe. We will not per se be sharing with other agents in the future, we will list and promote our own vendors properties.
The real truth here is that an agent supposedly sharing properties does not work. Take a look at Flynn’s comments about how some agents use other agent’s properties to burn resales and sell new developments even to the point of doing so in front of the vendor. And sadly, we have many more reasons as to why it simply does not benefit the vendor or the buyer to have agents sharing.
If your friend had no viewings in six months, then that would be distressing, as it has been for Katy’s daughter, we are selling properties every single day and right now in numbers akin to our better years, we don’t need to work with 50 other agents to sell a property, as I said there are many reasons why this does not work, but that is probably a separate issue.
Hopefully that helps, and I can spend a bit more time today to go through the final posts and as I said get back to the day job.
Thanks
Chris
-
-
-
@casalaloba wrote:
Hi Chris,
Thanks again. I bought a property last year. I had a separate contract for the commission with the agent which was settled when we signed at the notary. My “other” buying costs were thus marginally reduced but the bill I received from the agent still formed part of my total acquisition costs for the calculation of a future capital gain.
Sorry, but still confused by your commission arrangement. When you take on a property do you advise the buyer what price you consider the market will support and advertise it at this price ,with your commission being paid out of the eventual sale proceeds. Or, do you agree a price with the vendor, ADD your commission and market it at a commission inclusive price?
I appreciate that the effect of this when calculating your commission of 2.32% is hugely less distorting than when commissions of 10% and above are hidden within the sales price. But there is still an added cost if commission is calculated on a commission inclusive price. Given the awful press the agency sector is receiving, total transparency is essential to restore confidence in the buying process..
Also, I repeat my earlier comment that it is my understanding that you are obliged by a Royal Decree of Feb this year to provide a breakdown of the total consideration between “bricks and mortar” and all other charges. If I had an agency, I would do this as a matter of course.
If a lot of us had known that pensions advisers were taking fees irrespective of the performance of our funds many of us would have left the money in the bank. It has to be the same with you guys. We want to know the division of the monies we hand over when we buy a property.
Saludos,
James
Hi James,
I think this must be the mail that I missed…
I really would like to finally answer your query about our commission rate, and I am perplexed a little that I have been unable to do so, so I apologise for the confusion.
As simply as I can put this and as we put this to vendors, then yes our commission is paid out of the eventual sale proceeds. We will be agreeing the advertised price with the vendor and charging from the actual result. Does that answer your question?
I hope it does because we are indeed trying to be as transparent and clear as possible.
As previously stated with regard to obligations and decrees, we do our utmost to comply with government regulations, but we will now study the decrees and conditions you have mentioned here and previously, and may alter our exact policies in the near future as a result.
Our buyers will always be able to see the clear division of monies between ourselves and our vendors at the point of sale.
Saludos,
Chris
-
@casalaloba wrote:
Hi Chris,
Thanks again. I bought a property last year. I had a separate contract for the commission with the agent which was settled when we signed at the notary. My “other” buying costs were thus marginally reduced but the bill I received from the agent still formed part of my total acquisition costs for the calculation of a future capital gain.
Sorry, but still confused by your commission arrangement. When you take on a property do you advise the buyer what price you consider the market will support and advertise it at this price ,with your commission being paid out of the eventual sale proceeds. Or, do you agree a price with the vendor, ADD your commission and market it at a commission inclusive price?
I appreciate that the effect of this when calculating your commission of 2.32% is hugely less distorting than when commissions of 10% and above are hidden within the sales price. But there is still an added cost if commission is calculated on a commission inclusive price. Given the awful press the agency sector is receiving, total transparency is essential to restore confidence in the buying process..
Also, I repeat my earlier comment that it is my understanding that you are obliged by a Royal Decree of Feb this year to provide a breakdown of the total consideration between “bricks and mortar” and all other charges. If I had an agency, I would do this as a matter of course.
If a lot of us had known that pensions advisers were taking fees irrespective of the performance of our funds many of us would have left the money in the bank. It has to be the same with you guys. We want to know the division of the monies we hand over when we buy a property.
Saludos,
James
Hi James,
I think this must be the mail that I missed…
I really would like to finally answer your query about our commission rate, and I am perplexed a little that I have been unable to do so, so I apologise for the confusion.
As simply as I can put this and as we put this to vendors, then yes our commission is paid out of the eventual sale proceeds. We will be agreeing the advertised price with the vendor and charging from the actual result. Does that answer your question?
I hope it does because we are indeed trying to be as transparent and clear as possible.
As previously stated with regard to obligations and decrees, we do our utmost to comply with government regulations, but we will now study the decrees and conditions you have mentioned here and previously, and may alter our exact policies in the near future as a result.
Our buyers will always be able to see the clear division of monies between ourselves and our vendors at the point of sale.
Saludos,
Chris
-
@casalaloba wrote:
Hey Chris,
I’m off to El Bar Cadiz for a few Cruz Campos and a look at the Virgen as she passes! Hostilies can resume tomorrow. With all the free and intelligent advice you are receiving here, we should be sending you a modest fee note….plus IVA of course!
Saludos,
James
Hi James,
Did not want to miss this mail either…
Perhaps when I am next in Cadiz I can pay you for all your illuminating free advice with a few Cruz Campos instead, am sure it would be an entertaining evening!
Cheers
Chris
-
@casalaloba wrote:
Hey Chris,
I’m off to El Bar Cadiz for a few Cruz Campos and a look at the Virgen as she passes! Hostilies can resume tomorrow. With all the free and intelligent advice you are receiving here, we should be sending you a modest fee note….plus IVA of course!
Saludos,
James
Hi James,
Did not want to miss this mail either…
Perhaps when I am next in Cadiz I can pay you for all your illuminating free advice with a few Cruz Campos instead, am sure it would be an entertaining evening!
Cheers
Chris
-
@jiminspain wrote:
As we all know Estate Agents on the Costa’s have in recent years gained a rather tainted reputation, some by pure ignorance, some by unprofessional conduct, and some through pure greed and exploitation. Is it any wonder therefore that any scheme introduced by any Agent however well thought out and intended is perceived as another con, a gimmick, or both?
Commission levels of 4-5% are not considered by most as excessive, most vendors and buyers recognise the additional marketing costs associated with selling Spanish Properties to a predominantly UK based market.
The issue arises with the levels of professionalism and service offered by some Agents in return for their fees. Many have forgotten that their client the person with whom they have a written contact and obligation is the vendor.
The industry needs to regain the confidence of both vendors and buyers by being honest, transparent, and dependable with rewards coming from their endeavor and effort.
The wind of change is blowing and hopefully one day when someone asks what I do I will be happy to say I am an Estate Agent, without receiving that knowing look and raised eyebrow.
Jim
Hi Jim,
Amen to all of that, I agree with it all, the only thing I would say with regard to ourselves as an agent, is that it is not our intention to see ourselves selling to a predominantly UK based market.
Our model is also based on local business, where we have a substantial marketing presence, will also serve the national market here in Spain, and other markets also.
And like you we hope to recognise the utmost importance of our client the vendor. Whilst delivering a range of services to the buyer also.
I think we all want to be able to look people in the eye!
Chris
-
@jiminspain wrote:
As we all know Estate Agents on the Costa’s have in recent years gained a rather tainted reputation, some by pure ignorance, some by unprofessional conduct, and some through pure greed and exploitation. Is it any wonder therefore that any scheme introduced by any Agent however well thought out and intended is perceived as another con, a gimmick, or both?
Commission levels of 4-5% are not considered by most as excessive, most vendors and buyers recognise the additional marketing costs associated with selling Spanish Properties to a predominantly UK based market.
The issue arises with the levels of professionalism and service offered by some Agents in return for their fees. Many have forgotten that their client the person with whom they have a written contact and obligation is the vendor.
The industry needs to regain the confidence of both vendors and buyers by being honest, transparent, and dependable with rewards coming from their endeavor and effort.
The wind of change is blowing and hopefully one day when someone asks what I do I will be happy to say I am an Estate Agent, without receiving that knowing look and raised eyebrow.
Jim
Hi Jim,
Amen to all of that, I agree with it all, the only thing I would say with regard to ourselves as an agent, is that it is not our intention to see ourselves selling to a predominantly UK based market.
Our model is also based on local business, where we have a substantial marketing presence, will also serve the national market here in Spain, and other markets also.
And like you we hope to recognise the utmost importance of our client the vendor. Whilst delivering a range of services to the buyer also.
I think we all want to be able to look people in the eye!
Chris
-
Hola Chris,
Many thanks. Think I have got you. Sounds like you will be advertsising at a “bricks and mortar” price with your commission being calculated on the price agreed. Where I am, many of the agents include a ridiculous “mark-up” in the advertised price which the majority of buyers are quite unaware of. Foul behaviour. Congratulations on going for transparency. There is simply no other approach.
Saludos,
James
-
Hola Chris,
Many thanks. Think I have got you. Sounds like you will be advertsising at a “bricks and mortar” price with your commission being calculated on the price agreed. Where I am, many of the agents include a ridiculous “mark-up” in the advertised price which the majority of buyers are quite unaware of. Foul behaviour. Congratulations on going for transparency. There is simply no other approach.
Saludos,
James
-
-
-
@spain wrote:
Hi Chris,
following on from that last reply, what happens if they don´t hit those targets of 2 per month? and what happens with the commission from the 2 sales, do they get that on top of their 3000 per month salary or do they have to earn a set amount before actually earning commission as well, as from what I can see, 2 sales a month wont bring in that much commission, and if you are paying 3000 basic as well, plus commission – well that will be difficult won´t it?
Hi Spain,
OK, again I think some of this is kind of private and personal to our negotiators and ourselves, but as I intend to withdraw hopefully gracefully from the forum today, I will try to answer your question.
When people don’t hit targets in any business, then those targets will be looked at, performance reviewed, and an understanding reached as to where the problem lies.
Is it our problem, or the individuals, what can be done to rectify or help the situation?
Then do people need to be retrained or seek a new position would I suppose be the result, but I believe I pointed out elsewhere; that our entire staff, looked at and discussed this openly and together, and these performance levels are actually the norm. We have a happy team of people here; we now want to focus and make sure we have happy vendors and buyers.
As to commissions; our staff will have their basic contract and a bonus element on top, on all sales, and no they do not have to earn a set amount before earning any bonus.
As to what income you can see from 2 sales a month, and our basic contract, well no it won’t be difficult, but again I think you have to accept that we have a background and history, of sound planning and investment in our business and we would not be endangering the future of some 250 people within our company without their full support and knowledge of our process and plan.
Trust me it works, and back to the Easyjet scenario, I have never understood how people could fly from the UK at £29 to Malaga, when it cost me some £150 to go from the north to London by train, but those chaps seem to make a good profit and so do many UK agencies at 1.5%.
Chris
-
@spain wrote:
Hi Chris,
following on from that last reply, what happens if they don´t hit those targets of 2 per month? and what happens with the commission from the 2 sales, do they get that on top of their 3000 per month salary or do they have to earn a set amount before actually earning commission as well, as from what I can see, 2 sales a month wont bring in that much commission, and if you are paying 3000 basic as well, plus commission – well that will be difficult won´t it?
Hi Spain,
OK, again I think some of this is kind of private and personal to our negotiators and ourselves, but as I intend to withdraw hopefully gracefully from the forum today, I will try to answer your question.
When people don’t hit targets in any business, then those targets will be looked at, performance reviewed, and an understanding reached as to where the problem lies.
Is it our problem, or the individuals, what can be done to rectify or help the situation?
Then do people need to be retrained or seek a new position would I suppose be the result, but I believe I pointed out elsewhere; that our entire staff, looked at and discussed this openly and together, and these performance levels are actually the norm. We have a happy team of people here; we now want to focus and make sure we have happy vendors and buyers.
As to commissions; our staff will have their basic contract and a bonus element on top, on all sales, and no they do not have to earn a set amount before earning any bonus.
As to what income you can see from 2 sales a month, and our basic contract, well no it won’t be difficult, but again I think you have to accept that we have a background and history, of sound planning and investment in our business and we would not be endangering the future of some 250 people within our company without their full support and knowledge of our process and plan.
Trust me it works, and back to the Easyjet scenario, I have never understood how people could fly from the UK at £29 to Malaga, when it cost me some £150 to go from the north to London by train, but those chaps seem to make a good profit and so do many UK agencies at 1.5%.
Chris
-
@charlie wrote:
Hi Chris – I have to say I admire the way you have stuck with us and ‘batted’ every question thrown at you. I know everyone has learnt a lot re. your company’s position now and a lot of rumours have been laid to rest.
Even you have learnt something – compared to your first posting I now understand everything you write 😉You have mentioned your new ‘company model’ several times.
May I ask if this new model of yours will include keeping your ear closer to the ground re. marketing developments that are in an ‘illegal’ situation, waiting court decisions etc.?……from now on?Barbara
Hi Barbara,
Am going to split this up a little if I may, your post is so right and clear, but in order for me to keep my train of response clear, I would like to deal with it in sections, I don’t want to let you down as per my first post.
I think we are a lot more aware or beware of developments in an illegal situation now, we do intend to stay on top of this as much as possible.
And we have removed this development from our website following your remarks; further to this, I actually spent an hour with a journalist from the Financial Times this morning, being interviewed on the whole planning and town hall issue here in Marbella.
I talked to him about your problem, and that of others, and of the confusion for everyone as to just how any of this could have been allowed to develop.
He had spent the day with government officials and seemed hopeful that a realisation would come about, that all of these issues would have to be resolved and settled, and fairly soon.
But, no we would never knowingly sell a development, where we had any doubts or concerns, and as I think I stated earlier, we wrote to all clients who had bought in your project immediately and obtained I believe a return on their intial deposit funds for them. None proceeded to contract upon our advice.
If we had we been duplicitous however, we probably could have done nothing and claimed upwards of a quarter of a million euros in commissions is my understanding.
But, as a result of the past few days, I am going to be ever watchful in future of forums like this, to stay a lot more on top of what people are finding, saying and feeling.
Chris
-
@charlie wrote:
Hi Chris – I have to say I admire the way you have stuck with us and ‘batted’ every question thrown at you. I know everyone has learnt a lot re. your company’s position now and a lot of rumours have been laid to rest.
Even you have learnt something – compared to your first posting I now understand everything you write 😉You have mentioned your new ‘company model’ several times.
May I ask if this new model of yours will include keeping your ear closer to the ground re. marketing developments that are in an ‘illegal’ situation, waiting court decisions etc.?……from now on?Barbara
Hi Barbara,
Am going to split this up a little if I may, your post is so right and clear, but in order for me to keep my train of response clear, I would like to deal with it in sections, I don’t want to let you down as per my first post.
I think we are a lot more aware or beware of developments in an illegal situation now, we do intend to stay on top of this as much as possible.
And we have removed this development from our website following your remarks; further to this, I actually spent an hour with a journalist from the Financial Times this morning, being interviewed on the whole planning and town hall issue here in Marbella.
I talked to him about your problem, and that of others, and of the confusion for everyone as to just how any of this could have been allowed to develop.
He had spent the day with government officials and seemed hopeful that a realisation would come about, that all of these issues would have to be resolved and settled, and fairly soon.
But, no we would never knowingly sell a development, where we had any doubts or concerns, and as I think I stated earlier, we wrote to all clients who had bought in your project immediately and obtained I believe a return on their intial deposit funds for them. None proceeded to contract upon our advice.
If we had we been duplicitous however, we probably could have done nothing and claimed upwards of a quarter of a million euros in commissions is my understanding.
But, as a result of the past few days, I am going to be ever watchful in future of forums like this, to stay a lot more on top of what people are finding, saying and feeling.
Chris
-
-
-
@charlie wrote:
Hi Chris –
I appreciate the subject of this thread is agents’ fees.
But the continued selling of ‘dodgy’ developments by REA’s – where for example the legality of building licences are in question – is the cause of untold misery and stress, and even financial ruin for some.
As people who regularly read this forum know, one poor English lady caught up in one of the developments by Aifos had a nervous breakdown and ended up committing suicide.Yes, of course it should be our lawyers who look into the legality of a development before allowing a client to sign, but not all do. And as a lot of us know through bitter experience – there are lawyers who are actually ‘in bed’ with these developers.
Barbara
Hi again Barbara,
I would openly admit that I have personally had to deal with a small number of clients who have bought with us over the years, in a limited number of projects where they are now unhappy.
It has not been pleasant I can tell you; as I always prefer to deal personally with any complaint, and in truth we rue the day that we sold a couple of projects, but in all honesty I don’t know what I would go back and do differently. I cannot in hindsight see how we would have spotted or foreseen the problems that have occurred?
Would you believe that we had somebody yesterday ringing us up, to ask us if they could get access to our “screamers” so that they could give them an all singing, all dancing financial solution to immediately turn them into happy clients.
Can you believe it? That there are now a new set of vultures prepared to swoop and offer some new incentive to get into further issues.
We told this person that we simply don’t have what he called “screamers”, we don’t recognise the term or that any of our clients would be in that position. Where or if we have made a mistake we believe we hold up our hands and do our level best to find a solution ourselves. And I was not aware of the story of the lady with Aifos, but can imagine that many companies or agents might absent themselves, causing hugely more distress.
But as for the lawyers, I tentatively tried to stick up for the developer before, I am tempted to say that there are many good lawyers here, but I am not going to argue with you. I accept what you say.
Chris
-
@charlie wrote:
Hi Chris –
I appreciate the subject of this thread is agents’ fees.
But the continued selling of ‘dodgy’ developments by REA’s – where for example the legality of building licences are in question – is the cause of untold misery and stress, and even financial ruin for some.
As people who regularly read this forum know, one poor English lady caught up in one of the developments by Aifos had a nervous breakdown and ended up committing suicide.Yes, of course it should be our lawyers who look into the legality of a development before allowing a client to sign, but not all do. And as a lot of us know through bitter experience – there are lawyers who are actually ‘in bed’ with these developers.
Barbara
Hi again Barbara,
I would openly admit that I have personally had to deal with a small number of clients who have bought with us over the years, in a limited number of projects where they are now unhappy.
It has not been pleasant I can tell you; as I always prefer to deal personally with any complaint, and in truth we rue the day that we sold a couple of projects, but in all honesty I don’t know what I would go back and do differently. I cannot in hindsight see how we would have spotted or foreseen the problems that have occurred?
Would you believe that we had somebody yesterday ringing us up, to ask us if they could get access to our “screamers” so that they could give them an all singing, all dancing financial solution to immediately turn them into happy clients.
Can you believe it? That there are now a new set of vultures prepared to swoop and offer some new incentive to get into further issues.
We told this person that we simply don’t have what he called “screamers”, we don’t recognise the term or that any of our clients would be in that position. Where or if we have made a mistake we believe we hold up our hands and do our level best to find a solution ourselves. And I was not aware of the story of the lady with Aifos, but can imagine that many companies or agents might absent themselves, causing hugely more distress.
But as for the lawyers, I tentatively tried to stick up for the developer before, I am tempted to say that there are many good lawyers here, but I am not going to argue with you. I accept what you say.
Chris
-
@charlie wrote:
Hi Chris –
You wrote in your last answer to me
quote
I would imagine they (the developers) themselves are mortified at the mess that has ensued and I have real difficulty believing they would have anticipated any of these problems.
unquoteAm afraid Chris, when a developer applies for a building licence knowing it is for an area that goes against the Junta’s PGOU plan, (the original building licence was for 12 individual houses, not 12 blocks of apartments and they knew that very well) they may well be ‘mortified’ at the mess they are now in, but in no way could they have not ‘anticipated’ that one day, the doo-doos could/would/may possibly hit the proverbial fan.
Surely there has to be some responsibility shouldered by agents when they market something, whatever the product.
If I set up an agency selling/advertising dodgy gas cookers and one day inevitably one blew up in someone’s face, surely I would in part be responsible?As there are dozens and dozens of readers of this forum in the same position as I found myself in with Green Hills, just interested to know your position on this point, and whether it will be considered in your new business model.
Barbara
Hi Barbara,
I hope I have covered most of this in my last two posts.
And absolutely we will consider this very carefully going forward in our business model; our actual future depends upon it.
And again, where responsible I will hopefully have the gumption to admit it.
I think we have a history of having done so, and I think we might be fairly unique in having personally compensated clients financially in the past.
If you and the other readers would like access to expand on your views and problems in our publication HOT Properties, perhaps it is about time we went to bat publicly and in print on your behalf and we may well be prepared to do so.
You can let us know that answer to that notion on our company mail / website.
Chris
-
@charlie wrote:
Hi Chris –
You wrote in your last answer to me
quote
I would imagine they (the developers) themselves are mortified at the mess that has ensued and I have real difficulty believing they would have anticipated any of these problems.
unquoteAm afraid Chris, when a developer applies for a building licence knowing it is for an area that goes against the Junta’s PGOU plan, (the original building licence was for 12 individual houses, not 12 blocks of apartments and they knew that very well) they may well be ‘mortified’ at the mess they are now in, but in no way could they have not ‘anticipated’ that one day, the doo-doos could/would/may possibly hit the proverbial fan.
Surely there has to be some responsibility shouldered by agents when they market something, whatever the product.
If I set up an agency selling/advertising dodgy gas cookers and one day inevitably one blew up in someone’s face, surely I would in part be responsible?As there are dozens and dozens of readers of this forum in the same position as I found myself in with Green Hills, just interested to know your position on this point, and whether it will be considered in your new business model.
Barbara
Hi Barbara,
I hope I have covered most of this in my last two posts.
And absolutely we will consider this very carefully going forward in our business model; our actual future depends upon it.
And again, where responsible I will hopefully have the gumption to admit it.
I think we have a history of having done so, and I think we might be fairly unique in having personally compensated clients financially in the past.
If you and the other readers would like access to expand on your views and problems in our publication HOT Properties, perhaps it is about time we went to bat publicly and in print on your behalf and we may well be prepared to do so.
You can let us know that answer to that notion on our company mail / website.
Chris
-
@comeandgetme wrote:
Hi Chris,
at last the power has been returned to the vendors. I shall quickly organize a Vendors Meeting Association on the CDS in order to cash in myself concerning the current situation. With some agents selling at 10, 7,5 or 5%and you at 3%, it is time that vendors are able to sell for more. My association shall advice and on sale of the property undertaken by VIVA, we should get paid a percentage of the difference. With other words: 350.000 net at 3% or 300.000 net at 7.5% for the sale of the same property in two different agencies should be professionally adviced by my new Association, for this we charge.
Thank you Chris, I shall spin along on my idea…….just need to advertise in the SUR in English……..but you tell me please, what has happened to all these long established business relationships…..we cannot be friends any longer? Is it all one against all and all against one from now? 😯Hi comeandgetme,
I am afraid like the next post or two that follow, I also do not quite get this, I am at a bit of a loss how to answer it.
But in respect of your last point or question, what I can tell you, is that; it is not one against all or all against one from now on, not at all, hopefully it will be a respectful and professional practice, where the client both vendor and buyer is the most important party. And that everyone keeps that in mind.
Chris
-
@comeandgetme wrote:
Hi Chris,
at last the power has been returned to the vendors. I shall quickly organize a Vendors Meeting Association on the CDS in order to cash in myself concerning the current situation. With some agents selling at 10, 7,5 or 5%and you at 3%, it is time that vendors are able to sell for more. My association shall advice and on sale of the property undertaken by VIVA, we should get paid a percentage of the difference. With other words: 350.000 net at 3% or 300.000 net at 7.5% for the sale of the same property in two different agencies should be professionally adviced by my new Association, for this we charge.
Thank you Chris, I shall spin along on my idea…….just need to advertise in the SUR in English……..but you tell me please, what has happened to all these long established business relationships…..we cannot be friends any longer? Is it all one against all and all against one from now? 😯Hi comeandgetme,
I am afraid like the next post or two that follow, I also do not quite get this, I am at a bit of a loss how to answer it.
But in respect of your last point or question, what I can tell you, is that; it is not one against all or all against one from now on, not at all, hopefully it will be a respectful and professional practice, where the client both vendor and buyer is the most important party. And that everyone keeps that in mind.
Chris
-
Hi Chris
Again, your reply most appreciated and am heartened to know that you aim to be ‘more watchful’ re. problem-developments in the future. There are many! Bit late for most of us, but certainly a ‘..great step for mankind’.
Re. lawyers – yes, of course there are good lawyers on the CDS, the problem for many of us is finding them.
There are pages and pages on this forum of stories where people’s lawyers did not ‘act in their client’s best interest’ –e.g. allowed them to sign contract full of illegal clauses, contracts totally biased towards the developer, did not obtain a Bank Guarantee, ill-advising to complete without a Licence of First Occupation, overcharging on things like enforcing a Bank Guarantee, not informing clients of changes to development, not answering e-mails/tel. calls when problems arose etc. (Our original lawyer hit 6 of the above !).
There is one particular lawyer who seems to specialise in never obtaining Bank Guarantees for their clients. Then when asked (several years down the line) to obtain one by the purchaser who has finally wisened-up, they say it will probably ‘be a fight in court’ and quotes 6000 euros to do this!
What happened to: a BG is your legal right, at no cost to the purchaser? And for a lawyer not to obtain one is nothing other than derelict of duty.We even have now a ‘Rogues Gallery’ list of these lawyers. And Mark, the Administrator of this forum, conversely has a ‘Recommended Lawyer’ list. Believe me, both these lists have been created for a reason….
On our development alone, I know of 14 purchasers who changed lawyers
because of some or all of the above. And they are just the ones we know about.There is a famous agent talked about a lot on this forum, whose ‘recommended lawyers’ charged all fees upfront.
They subsequently did nothing more than arrange the signing of the contract, as the development never got built!
They then ‘disappeared’, only to re-appear with a new name/nameplate outside their door.
E-mails and faxes to the director of this law firm for some kind of part- refund re. the 7000 euros paid upfront (for basically doing nothing more than signing the contract) are currently being totally ignored.Trust me on this one Chris – the agent/developer/lawyer ‘triangle’ is famous on this site.
By the way, please do not think I am in any way insinuating your company is involved in this.There is nothing to answer re. this post – just writing ‘for your information’.
(bit like a freebie….. 😉 )Barbara
-
Hi Chris
Again, your reply most appreciated and am heartened to know that you aim to be ‘more watchful’ re. problem-developments in the future. There are many! Bit late for most of us, but certainly a ‘..great step for mankind’.
Re. lawyers – yes, of course there are good lawyers on the CDS, the problem for many of us is finding them.
There are pages and pages on this forum of stories where people’s lawyers did not ‘act in their client’s best interest’ –e.g. allowed them to sign contract full of illegal clauses, contracts totally biased towards the developer, did not obtain a Bank Guarantee, ill-advising to complete without a Licence of First Occupation, overcharging on things like enforcing a Bank Guarantee, not informing clients of changes to development, not answering e-mails/tel. calls when problems arose etc. (Our original lawyer hit 6 of the above !).
There is one particular lawyer who seems to specialise in never obtaining Bank Guarantees for their clients. Then when asked (several years down the line) to obtain one by the purchaser who has finally wisened-up, they say it will probably ‘be a fight in court’ and quotes 6000 euros to do this!
What happened to: a BG is your legal right, at no cost to the purchaser? And for a lawyer not to obtain one is nothing other than derelict of duty.We even have now a ‘Rogues Gallery’ list of these lawyers. And Mark, the Administrator of this forum, conversely has a ‘Recommended Lawyer’ list. Believe me, both these lists have been created for a reason….
On our development alone, I know of 14 purchasers who changed lawyers
because of some or all of the above. And they are just the ones we know about.There is a famous agent talked about a lot on this forum, whose ‘recommended lawyers’ charged all fees upfront.
They subsequently did nothing more than arrange the signing of the contract, as the development never got built!
They then ‘disappeared’, only to re-appear with a new name/nameplate outside their door.
E-mails and faxes to the director of this law firm for some kind of part- refund re. the 7000 euros paid upfront (for basically doing nothing more than signing the contract) are currently being totally ignored.Trust me on this one Chris – the agent/developer/lawyer ‘triangle’ is famous on this site.
By the way, please do not think I am in any way insinuating your company is involved in this.There is nothing to answer re. this post – just writing ‘for your information’.
(bit like a freebie….. 😉 )Barbara
-
Hi Chris,
As you are lowering commissions to 2% or 3% to include conveyancing, which I believe everyone agrees is in the best interests of the clients be-it buyer or seller.
Won’t this in-turn lead to a depletion of your more “Hungry” sales force to your competitors thus not really changing things unless the other agents in turn do the same?
In “sales force” I refer to Sales Support/Telemarketing (TM) and Sales Executive/Property Negotiator (SE).
Before the reconstruction of your business model, the average TM on the coast received/receives around 4%-5% commission per sale. The average SE received/receives around 10% per sale from Viva’s (or other agent whoever it may be) commissions.
Previously, Viva would get 7.5% for a resale and at least 10% from an off-plan. If you take an off-plan of let’s say €300,000, the real estate agent would have recieved €30,000 in commissions (10%). At this stage it makes no difference whether an off-plan or resale are sold as you say the commissions paid out will be exactly the same?
The SE would get around 10% of this (higher depending on position, experience, length of service etc). I make this €3000 per sale, which is what you say is the basic salary for a SE under the new model.
The commission now to a SE for an offplan will be the same as a resale (2%) so on the same figures above (€30,000 commissions), the SE would receive €600?
On your new model, I work out that a SE would receive €3000 basic salary and €1200 commissions for their 2 sales per month target (€4200). On the old model they would receive €6000 in commissions alone if you take into account 2 properties sold at €300,000.
If you look at a higher value property, let’s say €800,000. Estate Agents commissions €80,000, SE commissions €8000 (new model @ 2% €1600)
You can argue the point that they are going to be able to sell more as the property prices are lower, or that they have a more stable position within the company. But if I were a SE hungry for sales, to put food on the table, and enjoy the odd luxury from time to time, I know where I would be right now?
Joining the queue to apply for a new position with a company that paid higher commissions.
-
Hi Chris,
As you are lowering commissions to 2% or 3% to include conveyancing, which I believe everyone agrees is in the best interests of the clients be-it buyer or seller.
Won’t this in-turn lead to a depletion of your more “Hungry” sales force to your competitors thus not really changing things unless the other agents in turn do the same?
In “sales force” I refer to Sales Support/Telemarketing (TM) and Sales Executive/Property Negotiator (SE).
Before the reconstruction of your business model, the average TM on the coast received/receives around 4%-5% commission per sale. The average SE received/receives around 10% per sale from Viva’s (or other agent whoever it may be) commissions.
Previously, Viva would get 7.5% for a resale and at least 10% from an off-plan. If you take an off-plan of let’s say €300,000, the real estate agent would have recieved €30,000 in commissions (10%). At this stage it makes no difference whether an off-plan or resale are sold as you say the commissions paid out will be exactly the same?
The SE would get around 10% of this (higher depending on position, experience, length of service etc). I make this €3000 per sale, which is what you say is the basic salary for a SE under the new model.
The commission now to a SE for an offplan will be the same as a resale (2%) so on the same figures above (€30,000 commissions), the SE would receive €600?
On your new model, I work out that a SE would receive €3000 basic salary and €1200 commissions for their 2 sales per month target (€4200). On the old model they would receive €6000 in commissions alone if you take into account 2 properties sold at €300,000.
If you look at a higher value property, let’s say €800,000. Estate Agents commissions €80,000, SE commissions €8000 (new model @ 2% €1600)
You can argue the point that they are going to be able to sell more as the property prices are lower, or that they have a more stable position within the company. But if I were a SE hungry for sales, to put food on the table, and enjoy the odd luxury from time to time, I know where I would be right now?
Joining the queue to apply for a new position with a company that paid higher commissions.
-
Hey Rockitt,
You assume that the outrageously high commissions creamed out of the sales price will continue. You are wrong. The consumer has woken up to the rip off commissions taken by too many agents and the first question many will now ask is “how much of the price is being swallowed up in commission”?
Chris has clearly realised that the mood of the market has changed. In my book someone working as a “property telemarketeer” is worth zilch.
Estate agency properly practiced is a good profession. But when it is in the hands of sharks it stinks!I have a long experience of the property industry. Clients don’t exist to serve the commission requirements of agents. They are there to be served – professionally, courteously and with transparency.
Welcome to the brave new world!
Saludos,
James
PS Nothing personal 🙂
-
Hey Rockitt,
You assume that the outrageously high commissions creamed out of the sales price will continue. You are wrong. The consumer has woken up to the rip off commissions taken by too many agents and the first question many will now ask is “how much of the price is being swallowed up in commission”?
Chris has clearly realised that the mood of the market has changed. In my book someone working as a “property telemarketeer” is worth zilch.
Estate agency properly practiced is a good profession. But when it is in the hands of sharks it stinks!I have a long experience of the property industry. Clients don’t exist to serve the commission requirements of agents. They are there to be served – professionally, courteously and with transparency.
Welcome to the brave new world!
Saludos,
James
PS Nothing personal 🙂
-
@Fuengi wrote:
[quote=”I’m confused. A majority of your sales are resales? In that case would it not make more sense, as the majority shareholder to reformate the IN and work with other agents than to simply drop the system? I mean instead of all those different commission rates of the IN, just change it to 4 or 5%?
[/quote]
Hi again Fuengi,
I am afraid you have hit a bit of sore spot with me here, and this will probably open a whole can of other worms, it has been a long week being on here, and I have tried to do my best to be clear, concise and precise, but if you really do want the answer to this one, I am afraid you are going to have to suffer my longest response yet.
Then I hope to be off home.
I have previously mentioned that sharing amongst agents does not work.
It simply does not work for the vendor or the buyer, even at 5% that would be 150% more cost to both vendor and buyer, but even that does not work, the IN as an original concept was about agents “working together and winning together” but the reality became to our minds something entirely different.
Many, agents sought to use the IN as a vehicle to simply generate clients by saying that they had 7,000 or whatever number of listings, but they didn’t themselves have anything like this number or an equal share, the average IN member had less than 30 listings, we ourselves have 100 times that number, our nearest competitor / co-agent had something like an average of only 350 properties we have 10 times this number.
Did they really work as agents all of these people? Did they invest in listing and promoting? How many agents actually advertise properties locally? How many sales do they have to make to protect a good living at the expense of the vendor and the buyer? With what real promotional activity or effort? Do they promote the fact that they have resales yet actually prefer to sell new developments only?
How many of their clients did they actually bring to ourselves to show properties, and how many times did they use the listings of ourselves and other agents to convince clients that they had seen it all on the system and there was no need to view? Were our own clients and listings being best served by the activities of others?
How many listed all of their properties on the IN network or actually kept how many listings in the drawer so that vendors would believe they were on the network, but were actually being kept away from the network because the agent believed a sole agency sale was preferable for them? How many of these agents were prepared to listen when I actually told a number of them to go on to the Spanish Property Insight and just see what vendors and buyers thought of them, us and our practices?
How many of these agents are also dedicated Spanish Estate Agents? Or how many are better described as so called “International Agents” selling worldwide on the tired old mantra of investment, investment, investment, because that is all they know, but find it most handy to have the presentation that they have a base business here with so many thousand listings, yet turn those interested clients to Morocco, Bulgaria or wherever?
I have to be really careful here, because I consider a good number of IN member agents to be friends of mine, people I like and know are good people, and I don’t wish to be seen to be knocking or denigrating them or their individual businesses. I am talking collectively here.
A whole bunch of them are now looking to form another version of the IN and I am led to believe are now going to pull down their own rates to 5%, well I think we did that for the vendor and buyer, and we ourselves are funding the continued background operation of the IN to do our absolute best to ensure that none of these members lose their software, access to their own properties and their functionality until an orderly transfer can be made to their own dedicated system.
We support them in whatever they wish to do, but the simple fact is, our clients were not best served by dealing with other agents, and ultimately we could not change our proposition by being involved with other agents.
We had to leave the IN, and the IN as it is, was not viable without us, so it has to go and be now replaced by another entity, will it work any better without us? Will we now compete? And if we do, is that not a good thing for the market?
Let them get out there and promote, let them get out there and spend some of their revenue, but for us, we became fed up being called one of the big boys, the fat cats, the abusers of vendors and buyers, we now would just rather offer our service and be responsible for our own actions and not be necessarily linked to others.
The thing is we believe in fact know for sure that we sell far more properties than any other agent, we list far more, we promote far more, and in this past week without other agents our clients have benefited by our selling in excess of 30 properties, we will see who wins here, but I think the vendor and buyer have already started to win, and we are pretty happy too, yet.
The average agent response seems to have been furious and indignant, our staff are being harangued everywhere, restaurants, petrol stations and over the mobiles, many agents are absolutely hopping mad, they think we are destroying the market, the key comment they come with is “What are we going to do now, what’s going to happen to us”.
Yet, let me tell you the most common response from vendors is, if you will pardon the slight profanity, they are saying “About bloody time too..!”
This is our business and we hope that everyone will respect our efforts.
Thanks and I hope this helps because I am very definitely almost out of here. It has been a bit of a challenge covering all of this all week, between the day job, but I wanted to clarify the last few mails and be gone by the end of the day, and this seemed like the final area really.
Chris
-
@Fuengi wrote:
[quote=”I’m confused. A majority of your sales are resales? In that case would it not make more sense, as the majority shareholder to reformate the IN and work with other agents than to simply drop the system? I mean instead of all those different commission rates of the IN, just change it to 4 or 5%?
[/quote]
Hi again Fuengi,
I am afraid you have hit a bit of sore spot with me here, and this will probably open a whole can of other worms, it has been a long week being on here, and I have tried to do my best to be clear, concise and precise, but if you really do want the answer to this one, I am afraid you are going to have to suffer my longest response yet.
Then I hope to be off home.
I have previously mentioned that sharing amongst agents does not work.
It simply does not work for the vendor or the buyer, even at 5% that would be 150% more cost to both vendor and buyer, but even that does not work, the IN as an original concept was about agents “working together and winning together” but the reality became to our minds something entirely different.
Many, agents sought to use the IN as a vehicle to simply generate clients by saying that they had 7,000 or whatever number of listings, but they didn’t themselves have anything like this number or an equal share, the average IN member had less than 30 listings, we ourselves have 100 times that number, our nearest competitor / co-agent had something like an average of only 350 properties we have 10 times this number.
Did they really work as agents all of these people? Did they invest in listing and promoting? How many agents actually advertise properties locally? How many sales do they have to make to protect a good living at the expense of the vendor and the buyer? With what real promotional activity or effort? Do they promote the fact that they have resales yet actually prefer to sell new developments only?
How many of their clients did they actually bring to ourselves to show properties, and how many times did they use the listings of ourselves and other agents to convince clients that they had seen it all on the system and there was no need to view? Were our own clients and listings being best served by the activities of others?
How many listed all of their properties on the IN network or actually kept how many listings in the drawer so that vendors would believe they were on the network, but were actually being kept away from the network because the agent believed a sole agency sale was preferable for them? How many of these agents were prepared to listen when I actually told a number of them to go on to the Spanish Property Insight and just see what vendors and buyers thought of them, us and our practices?
How many of these agents are also dedicated Spanish Estate Agents? Or how many are better described as so called “International Agents” selling worldwide on the tired old mantra of investment, investment, investment, because that is all they know, but find it most handy to have the presentation that they have a base business here with so many thousand listings, yet turn those interested clients to Morocco, Bulgaria or wherever?
I have to be really careful here, because I consider a good number of IN member agents to be friends of mine, people I like and know are good people, and I don’t wish to be seen to be knocking or denigrating them or their individual businesses. I am talking collectively here.
A whole bunch of them are now looking to form another version of the IN and I am led to believe are now going to pull down their own rates to 5%, well I think we did that for the vendor and buyer, and we ourselves are funding the continued background operation of the IN to do our absolute best to ensure that none of these members lose their software, access to their own properties and their functionality until an orderly transfer can be made to their own dedicated system.
We support them in whatever they wish to do, but the simple fact is, our clients were not best served by dealing with other agents, and ultimately we could not change our proposition by being involved with other agents.
We had to leave the IN, and the IN as it is, was not viable without us, so it has to go and be now replaced by another entity, will it work any better without us? Will we now compete? And if we do, is that not a good thing for the market?
Let them get out there and promote, let them get out there and spend some of their revenue, but for us, we became fed up being called one of the big boys, the fat cats, the abusers of vendors and buyers, we now would just rather offer our service and be responsible for our own actions and not be necessarily linked to others.
The thing is we believe in fact know for sure that we sell far more properties than any other agent, we list far more, we promote far more, and in this past week without other agents our clients have benefited by our selling in excess of 30 properties, we will see who wins here, but I think the vendor and buyer have already started to win, and we are pretty happy too, yet.
The average agent response seems to have been furious and indignant, our staff are being harangued everywhere, restaurants, petrol stations and over the mobiles, many agents are absolutely hopping mad, they think we are destroying the market, the key comment they come with is “What are we going to do now, what’s going to happen to us”.
Yet, let me tell you the most common response from vendors is, if you will pardon the slight profanity, they are saying “About bloody time too..!”
This is our business and we hope that everyone will respect our efforts.
Thanks and I hope this helps because I am very definitely almost out of here. It has been a bit of a challenge covering all of this all week, between the day job, but I wanted to clarify the last few mails and be gone by the end of the day, and this seemed like the final area really.
Chris
-
Hi Casaloba
No offence taken 😉
I think you misinterpreted what i was trying to say.
I believe that the comission levels will continue, maybe not for Viva, but without this, the smaller agents that don’t produce the volume of sales that Viva or some of the larger agents do won’t be able to survive.
Whether this will continue in the long term remains to be seen.
The point i was trying to make is the “hungry” salesperson on maybe 15% or even 20% for performance related targets, bonuses, length of service, position within company etc would be the hardest hit by the change, straight in the pocket so to say.
Chris said that under the new model they have been offered the basic salary/car/job security package, so what?
Once you get used to the lifestyle, and picking up a 5 figure cheque at the end of the month, it wouldn’t give me motivation to sell when you know that the comissions you will recieve from today are based on 2% and not the 10% you are used to.
I gave some rough examples, but can’t see that the model proposed by Chris will suit everyone.
The Vendor yes, the buyer definitely, but the saleperson? But then again who cares, no-one on this forum that’s for sure.
I totally agree with what you say in that the client doesn’t exist to serve the comission requirements of the agent. At the end of the day without the client there would be no agent, we have to look after the clients inturn they will look after us.
I don’t agree with what you say about the consumer “waking up” to the amount of comissions being earned. Yes, the client is more aware now through media like the internet, but how many sales still went through today and will still go through tomorrow and the day after.
Viva have taken a HUGE step here, in my opinion a risky step, but Chris has obviously thought long and hard on this before making the decision for change good or bad.
I don’t believe that the posts on this forum will reach the masses of people landing at Malaga on a daily basis, the small minority maybe, the majority absolutely not.
Maybe it is time for change, the market needs it that’s for sure, maybe Viva’s step isn’t so bold, maybe this is the start of a new beginning, maybe i’m waffling.
I am not defending the salesperson here just pointing out that they will naturally go where the money is, i would, but then again my opinion is worth zilch 😉
-
-
Dear All,
Dont forget a while ago “rockitt” told us that he was an employee of the Awful agents – often mentioned on this board.
So should we assume he doesnt care about us at all, just making sure he gets all the facts about the competition and how to continue his fat commission cheques
👿
It would seem on the surface that VIVA is trying to make an effort to wake up a stagnent market.
Like Katy’s daughter I also have my house up for sale with VIVA – maybe Chris could give a kick in N.A. office?
-
Banushouse,
The question i posed to Chris i believe is relevant in pointing out that under the new Viva model his staff would be much worse off.
This makes no difference to me personally i can assure you, i was simply posing a question which i believe i am free to do as everyone else has done, is that not the purpose of this thread?
Believe me, i wish i was recieving fat commission cheques, but that simply isn’t the case any longer. As you point out the market is stagnant, everyone can see that, and Viva’s attempts to re-ignite it remain to be seen.
In my opinion, Chris is making more of an effort than you think, sticking his neck on the line, laying his cards on the table etc, but if you remember, initially he was met with hostility too.
There are members of this forum that don’t stop to reserve judgement, have i ever commented, or made a personal attack against anyone on here, i have made 3 posts so far one of them giving advice, which i will continue to do. Whether that advice is taken, or you don’t agree with me, then i will hold up my hands if that is the case.
I believe that you have confused this with (and if i must speak in code) the-region-in-my-location dot com.
A while back, if i remember correctly, a couple of members there were slating the company that i work for. I jumped to the defence of this rightly or wrongly, as i didn’t agree with what was being said. Paul and possibly yourself clearly had a personal issue with this and he, i believe was one of the (shark infested) members along with a couple of others banned from that particular forum for what was said.
The attacks towards me were personal, which were not necessary, as in this instance.
I am not here to pick a fight, i am not being hostile, this was never and will never be my intent. I too have been watching this forum for a while, possibly other large agents also.
If we all look to what Viva have done, maybe the market will turn around and give more confidence to the buyer in Spain again.
One thing is for sure, the market does need to change and everyone (agents included) need to realise that the BOOM times have gone.
I am not here to do what Chris has done, or say what Chris has said about the company i work for, i cannot or will not comment on personal cases, i would probably lose my job as i am not as important as you may think.
Believe me or not, i don’t lie, cheat, steal, mislead, mis-inform or hide the truth from clients that i have contact with. We are not all sharks out to get all we can from the client whether it’s in their best interests or not.
I ask that you give me the benefit of the doubt here, and i will do the same in return.
-
@dulex wrote:
We do have the services of an “in house lawyer”.
Chris
Does this mean that Viva have set up their own legal practice for conveyancing purposes in the same way as some large estate agents have done in the UK?
Hi Dulex,
Unfortunately, I was unable to answer every question I had, had up to and including Friday, as time simply did not permit this, so my apologies, but I hope to sneak in now, to finish the few outstanding questions, and then leave the forum back to you guys.
No, we will not be setting up a legal practice per se, we will simply be doing the conveyancing work, we will have the services of an In House lawyer for certain legal enquiries and to review contracts etc, but anything that is outside the normal conveyancing procedure we may refer parties onward where specialist legal advice is required.
As to a previous point I believe I made, the process is in the vast majority of cases a simple procedure, most Spanish nationals would not dream of using a lawyer in the sale of their property, but regardless, there will not be an extra cost for this, and it will be funded (unless in an unusual case) within the 1% conveyancing fee.
Chris
-
@Rockitt wrote:
Hi Chris,
As you are lowering commissions to 2% or 3% to include conveyancing, which I believe everyone agrees is in the best interests of the clients be-it buyer or seller.
You can argue the point that they are going to be able to sell more as the property prices are lower, or that they have a more stable position within the company. But if I were a SE hungry for sales, to put food on the table, and enjoy the odd luxury from time to time, I know where I would be right now?
Joining the queue to apply for a new position with a company that paid higher commissions.
Hi Rockitt,
I have edited down the quote from your post quite a bit because it covers quite a lot of assumptions and figures that I just don’t recognise.
I don’t mean that offensively, it is just that I have covered quite extensively elsewhere our business model and a breakdown of our packages for personnel.
And your numbers, taken as the norm; I must assume from wherever it was that you worked, or perhaps do work now, are simply not our numbers or indeed anything like them. So I just can’t comment on them.
The thing I think you have to accept here, is that we are plain and simply not looking for commission hungry salespeople, they are not who we want to work with, they are not who we want to represent us, it is just not part of our plan.
Nobody has left us as a result of our new model; in fact we had five property negotiator applicants to interview on Friday alone, as a result of the rumour and talk around the coast of our new model.
If we are right and if we effect change, then it may actually be the end of the company hopping high commission salesperson on the coast, I don’t know. I can’t and won’t predict that, but one last time I would refer you to the fact that agency personnel in the UK seem to be able to make a living from their companies charging 1.5% commission.
Thanks for the question and I hope you understand that I am not going to breakdown everything further than I have.
Chris
-
@Rockitt wrote:
Hi Casaloba
I am not defending the salesperson here just pointing out that they will naturally go where the money is, i would, but then again my opinion is worth zilch 😉
Hi Rockitt,
I think your opinions are fine actually, and worth a good bit more than zilch, I understand that you were not defending the salesperson. I think the points you made were representative and as such entirely valid, as they went to the mindset of the actual salespeople on the coast, which will be very much part of the debate going foward.
And I appreciate you were supportive of our concept in general terms; being of benefit to both the vendor and the buyer, in time hopefully, you may see that our staff are not impoverished, that in fact they are able to make a good living and have a good life, and who knows… maybe we end up working for the same company one day!
Thanks for the original post, I think I forgot to add that before.
Chris
-
Hi all,
I think it is probably about time I left the forum, I think I have answered pretty much every question that has come up and didn’t want to leave anyone without a response, and hopefully if questions come up in the future you can do me a favour and refer them back to my responses from last Monday 11th August onward, but nobody wants me around here much longer I don’t think.
I had a lot of advice before entering the forum, all of it said NO DON’T GO THERE! Yet I came on here, because it was from being on here many months ago, that I got a real sense of what our vendors and buyers must think of us. And because of this we set about changing our entire business model.
So, why would I not come on here to talk about it?
Frankly, I was a bit worried, and I took some deserved flak early on for being a bit enigmatic perhaps and possibly patronising, but I was rightly put straight on that score.
But the advice I received was wrong, I hope that I have not been here to promote or even mention (save perhaps once) our company name or business, I just wanted to answer any rumour with a straightfoward answer (forgive me for the rather long one occasionally) in as clear and concise a manner as possible.
You all gave me that opportunity, but if I stay longer, then firstly; I would end up being guilty of using the forum to promote our business and secondly; not only would I be repeating myself but you would probably question whether I had time to run the company.
So, thank you very much for all the questions, they were excellent, insightful and actually very helpful to myself going forward. Sorry for this speech at the end also, but I thought it would be rude not to effectively say goodbye!
If anyone such as Katy, Banushouse or Barbara or anyone else who might need me to do something on their behalf in the future, would like to e-mail me privately I will certainly respond and do whatever I can.
I shall watch the forum in future with continued interest, and if ever I am in Cadiz I will certainly look to buy James a Cruz Campo.
Thanks again, for all your lively debate and the rather hot; but entirely fair grilling at times.
Chris
-
-
@banushouse wrote:
Chris, I certainly appreciate the time you have spent on this forum, it reflects very well upon Viva and you personally.!
How do we email you directly ? 😀
My private mail address is chris.mccarthy@vivaestates.com
-
-
What a refreshing change! Well done Chris for being so frank and in actually answering all the questions.
The new business model that Chris and his company have put into place going forward is what the CDS has been waiting for for ages. We can only hope the major agents on the other coasts soon follow suit.
-
-
i know nobody cares about the “poor” salesperson here, but I have heard that the 300 basic isnt as simple as on is lead to believe.
I have heard, i.e. not fact yet, that the salesperson starts on 1000, then has to do a certain amount of listings and hitting targets before hitting 2000 a month, then there are a further set of targets before reaching 3000 a month, that the car is not added on top of the wages, rather taken out, and that 6 sales have to be done with no commission taken before you can start earning any commission at all.
food for thought…
-
😉
Rockitt, just to let everyone know, I’ve never had a problem with Chris or his company and in the past we have been in contact with each other. I’ve been watching this thread develop and so far what Chris is doing must be good for purchasers and vendors alike.
As for Awful, speaking from my experiences and those of many others who contacted me about them, I really could never recommend them to anyone in future. The sales person and her manager etc did mislead us about potential, did leave us in the lurch until I kicked up a fuss with the Press involved, the whole sorry thing went 3 times over the prediction causing us to lose out heavily in Spain and the UK, she also lead us to their dreadful recommended lawyer, a developer who went bust only to hand over to a questionable promoter, heavy delays on building licence, snagging and specification problems etc etc
I did take it personally since I don’t like lies and hype and I didn’t like others falling for the same trap.
The whole thing was a nightmare, and strangely, it was Chris’s firm we should have been with, they unfortunately missed picking us up, then Awful’s sales woman stepped in, which was to our misfortune.
I’m glad to hear you are honest Rockitt, I just wish more of their staff had been in the past. Hopefully they will follow Chris’s action and restore some credibility.
-
Paul,
Totally agree with you like others here, which is what i have already stated in my posts.
And thank you for not being hostile towards me like in the past 😉
As i said, i am not here to cause offense, cause trouble, be hostile etc, i want to offer my advice when i can and be as honest as possible.
Unfortunately i cannot comment on your personal experiences, or what has happened to others is the past. I can however guarantee that whoever i have contact with is advised with respect and credibility, and put simply, told the truth as i would only expect this myself.
-
It’s quite refreshing Rockitt to hear your views and stance now, maybe it’s a sign of things to come even from your company.
I doubt by what you say that you were involved with my case (well I hope not), and I suspect those involved have mainly moved on to H2o and other companies. The problems could have been resolved much earlier if OE had a decent customer service team in those days.
I think that honest sales etc would lead to lots of repeat business and, the lowering of commissions as Chris is doing will also go a long way to cleaning up a tarnished image of the Costa property market. I have to say though that most of the C del Sol is an eyesore with the overdevelopment, I knew it years ago when it actually looked nice.
-
What i found interesting here is that my grandfather (nearly 80) has got his villa listed with VE and when they came to list it told him it should go on the market at 3.3m€…way over what it is worth…he has actually got it listed for 2.7m€ in the end…but people why the market is so stagnant?? Perhaps this is an answer on its own??
On another note, he was contacted on Friday night at 9pm Spanish time to “discuss his property” and the property negotiator was apparently shcocked that he was not jumping backwards through hoops at this new offer…
He has his property listed with other agents, and is shrewd enough to ask the question…”Will i get more net to me then??” with the obvious reply “No.” “So why does it matter to me who sells it if i will walk away with the same amount of money??”
He also asked what would happen if he said no…”We will IMEDIATELY DE-LIST YOUR PROPERTY” That is very good business sense…this is a villa that is currently their property of the month!! FYI – He told them to do what they thought was nessesary and he was not going to pay up front for their service…if they are no longer an MLS company, and their Director says that they no longer do Viewing Trips, then you are only relying on one agent to sell your property. Anyone who can see the way the market is at this time will surely be listing their property with as many agents as possible to give themselves the best chance of selling.
I DO NOT LIKE THE ABOVE SCARE TACTICS BEING USED ON AN 80 YEAR OLD MAN!! 👿
Some food for thought there before people start to jump up and down saying how fantastic this will be, only 2% commission!!
1) The money will have to come from somewhere for the advertising etc.
2) Their sales staff will only try and sell their own listings to make extra money as they will be earing less from regular commissions.
3) Not to sure about the idea that you have to use the conveyancing service no matter who sells your property…what if your circumstances change and you just decide to take yur property off market, as so often can happen.
4) Who is likely to take a hit on any offer made by a buyer?? Can’t see them negotiating with a piddley 2% wheras other agents have some leeway within their commission and not just get the vendor to put it bluntly…drop their trousers…I do respect VE for being bold with this, but also feel that it has to make them money in the long run…they are all in this industry to make money.
Please remember “These are just my thoughts, just what i was feeling at the time…”(Jay-Z – Blueprint)
-
-
This message is to Spain – but also to any other sales peopel who are reaidng this excellent posting.
As an agent who has employed people myself on a similar basis – ie a fixed amount plus commission – the majority of people here in Spain are not willing to work for their money – they accept it as a God given right that someone owes them a living.
I see no problem in a company minimising their initial risk by offering a sliding scale and proving you are worth paying you a fixed basic of 3,000 euros per month – plus a car. by seeing if you can actually do the job before theypay you the higher rate.
If you worked in sales in the UK and didnt sell after a trial period they would get rid of you. Period. And Sales is about the only jpb in the UK where you can fire someone without too many recriminations – because your pay os performance based. If you are a genuine sales person (and to me a sales person is someone who listens more than he talsk and gives clients what they want not what he or she wants) then you will prove yourself very quickly.
If not the door is there – please close it before you leave. The time share salesman of old I personally believe is on his/her way out because clients are very aware of pressure selling and generally will bto accept it. Most British hate being sold to = but are more thanhappy to listen to someone offering genuine advice and help and will willingly come to you time and again.
So the point really is whether their package is not as easy to get as first seems is really nothing to do with this forum, it is between VE and the potential salesperson to decide if it is mutually beneficial – of so then the sales person accepts the role – if not he/she works for another company.
Well done to Chris for attempting to change the market, for being refreshngly honest and for offering people a genuine opportunity to further their career in a tarnished industry
Vince
-
Hi Vince,
thanks for the post, I enjoyed reading it. i am slightly confused at the sales person part of it, I didn´t know I worked in sales…..thanks for letting me know that 😉 , I actually thought I did something totally different.
Anyway back to the post, I agree with what you say about pressure selling, I personally would hate to be pressure sold, and knowing me that sales person would get a bit of whiplash from my response, menot being the most tactile person people know. The way I see it is if you are sold something you don´t want, you only end up taking it back, so what´s the point?
I prefer, as you say, someone to give me genuine advice(at least I hope it´s genuine, you never can tell these days ) and I leave that shop or wherevr it is thinking I have made my own choice.
What I do not understand is, as you also say, it is a performance related job, and as such, you perform, you get paid.
Under this scheme, I now understand how VIVA can afford to pay such high wages on low commission, they take 6 sales for free before paying anything out.
Now you take it that an average sale is 300-400k euros on the coast, I´m guessing here but most properties seem to equate to that these days here.
Then 6 X 300,000 sales at 2% commission, is 36000 euros, if it was 400000 euros, it would be 48000 euros.
Add on your 1% conveyancy fee and they are taking between 54000 and and 72000 euros, if my maths is correct. So they have effectively taken in your earning for up to two years, based on that fact you get straight onto the 3000 basic, but if you don´t get onto that basic God knows how long they could pay you for.
And if you leave in the meantime….even more money in their pocket.
I do truly commend what they are doing if for the right reasons, but looking behind the “transparency” it seems less transparent, if you forgive my confusing explanation.
-
I admire Chris’s stand to bring some credibility to the Spanish Property Market but do have the following thoughts. It seems that the upfront payment is an attempt to effectively get a solus agreement from vendors. With the levels of commisions being charged no other agents will colaborate and split the 2% being charged, as Rockit says in the current market place vendors look to get as much exposure for their properties as possible. I believe colaboration works well when a small group of good agents work together ensuring they have the properties and clients to match the asperations of both the vendors and buyers. I would reiterate that the most important factor is to provide excellent, honest service for all parties giving a value for money service for all concerned. Again as posted previously with low commisions the agent has nowhere to move when buyers make below asking price offers. I have just closed a deal where because we have 5% on the original listing we have reduced to 3% to make it happen, I was upfront with both parties as to how we would help and have a very content vendor and buyer.
We all have to remember we should be in business to provide a service (and hopefully make a sensible profit in the process)ps written in a hurry excuse typos
Jim
-
I think it’s about time that the agents agreed to a lesser commission. In what other profession would you stand to make 10% of the price of someones property for bringing a buyer to them. And when it can take years to amass some equity why would we want to give 10% of that away to some people who were potentially a butcher yesterday and an Estate Agent today (no offense to butchers).I know of brain surgeons with years in University and medical school who earn less than that!!
I think that 2%-3% is much fairer and it’s precisely because people are earning more and more money at a completely unjustifiable and often quite unbelievable rate that we are all having to pay so much more for everything. You can’t get decent trades people easily anymore because everybody wants to be an estate agent and at 50,000 euros a pop for some properties who can blame them!!Great postings though!
Bopsy -
“I think it’s about time that the agents agreed to a lesser commission. In what other profession would you stand to make 10% of the price of someones property for bringing a buyer to them. And when it can take years to amass some equity why would we want to give 10% of that away to some people who were potentially a butcher yesterday and an Estate Agent today (no offense to butchers).I know of brain surgeons with years in University and medical school who earn less than that!!
I think that 2%-3% is much fairer and it’s precisely because people are earning more and more money at a completely unjustifiable and often quite unbelievable rate that we are all having to pay so much more for everything. You can’t get decent trades people easily anymore because everybody wants to be an estate agent and at 50,000 euros a pop for some properties who can blame them!! “I wouldn’t think that everyone wants to be a real estate agent. Anyone who works in the profession knows that it is hard work, the days of someone rolling in off the street with a wad of money in their hands ready to buy are well gone.
I know plenty of REA’s who work hard and earn just enough to keep going
Tis very very very very few people who make “€50,000 a pop” just like that![/b] -
Hi Bopsy,
I have now been an estate agent in Spain for five years, in that time I have worked for several agents non of whom have charged more than 5% I guess there are still some agents that attempt to charge 10% but believe these are now in the minority.
The fact that some developers will offer commision levels of 10% plus in an attempt to encourage agents to promote their developments is really the root of the problem.
Certainly in this area though (not CDS) developers have now realised they are pricing themselves out of the market and 5% is becoming much more the norm, this now means that there is a much more level playing field and hopefully property will sell on its merit not as a result of being pushed by agents hungry for higher commission levels.
My business partner and I are both, how shall I say more mature individuals, have worked at the highest levels for some of the largest companies in the world, have letters after our names (but don’t shout about it) and have never been butchers!
I agree the sharks should be named and shamed, but don’t tar us all with the same brush, some of us are trying to bring some professionalism to the marketplace.
As an aside can you think of any other business or proffesion that operates at gross profit levels of 5% or less.
-
Hi Jim
as an agent I agree with most of what you say.
There are many agents who do not over charge. However I know of a few agents locally who tell clients they charge 3% or 4% when in fact what they do is charge both buyer and seller – so whilst they appear to be slightly cheaper than others the buyer gets a shock when they realise they are paying some 4% more than advertised. To me this is sharp practice.
I also know of other agents who will charge their clients what they think they can get away with – I have seen 50% commission charged on a property that an old Spanish man was selling and the agent was happy to accept the gentleman’s valuation of 67,000 euros for a large townhouse which he sold for 140,000 Euros (it was even worth more than that due to its size)
How such people can sleep at night I do not know
With regards to developers and their commissions to agents – most of the developers in this area will seldom give more than 3% commission – 5% is pushing it somewhat. But to be honest most of the developments are overpriced – even with lower commissions, so its not worth selling.
I do disagree with your aside however – an agents gross profits are somewhat more than 5% because we do not actually buy the properties ourselves to resell on – whereas if you are selling computers, furniture or whatever you do have to buy goods up front to resell.
Therefore the gross profit is a lot higher because we have no financial equity until the point of sale.
One thing that this thread has done is highlight that there are agents out there who are fair in their dealings with customers – and maybe they will raise their heads above the parapet and be counted.
Good luck to the good agents out there – there are many and lets hope this has initiated long needed change
Vince
-
I must jump in at this point and speak in defence of the few estate agents I know.
None of them charge even 5%. Which does seem a lot until you realise they are not selling NEW developements in purpose built urbanisations but re-sale rural homes.Unlike in UK where the estate agent charges upwards of 1.5% ( 3% for multiple agencies) stays behind his desk just making viewing appointments and then sends the clients out to look because roads have names and they work in a small catchment areas.
Here the agent does all the slog. Petrol and wear and tear car expences ,tapas etc for clients take up a lot of the commission because properties can be km’s apart. Up hills and dodgy tracks..not all urbanised and tarmac as in UK…and there are many time wasters ….just looking !!!
Works bothways.
Get those in UK as well but at their own expence not the agents.
When we were looking to buy our plot we were taken everywhere and no=one could have done more. Even legality of parcela checked .
It took 11 months many many km,s and two aborted attempts to finalise on the plot we wanted and I don’t begrudge one cent of the 5000€ inc IVA we were charged. Gross profit to them probably nearer than 1% ,than the 4% agreed , in the end. So pro rata cheaper than UKThe agents who work only for the BIG developers have soured the industry but don’t think everyone should be tarred with the same brush.
Surely one inquires beforehand and if you don’t like the size of the commission charged you go somewhere else ….don’t you ???
-
Where do these suggestions of 5% Gross Profit come from – the Gross Profit is the commission less direct expenses (ie staff costs) which means the gross profit is probably 75% upwards! The REA never owned the property so the selling price is not the starting point of the accounts!
Let us all put things in prospective – the costs of property on the CDS is such that it compares with the South of England. There the agent will charge 1-1.5%. Set against that the lower overheads here (staff at 40% of UK wages, IBI/Rates at 25% of UK levels, Fuel at 80%) coupled with the fact that agents here in Spain do not have to be registered, qualified or conform to the same regulations (with the costs associated with compliance) few if any have Professional Indemnity Insurance and I would say that the net profit to an agent in Spain would be at least double that to his UK counterpart on a similar level of sale.
OK, I accept that some agents spend a little extra on “promotion” into the UK to attract buyers to Spain BUT set against that the fact that UK agents maintain mailing lists, send prospective buyers full details of new properties twice weekly, run pages of advertising in local (and national) papers weekly, provide quality “For Sale” signage and the costs of the “promoting” here in Spain can clearly be seen as very much lower!! Except VE who do advertise in the same way that most UK agents do.
Let’s see the agents here in Spain all work for the correct and justifiable commission level of 1-2% and still receive double the profit of their UK counterparts when the industry here is so less professional (by qualification and regulation). Anything above that really is the spoils of a Dick Turpin act.
Why over the past 5 years have so many “Real Estate” agents cropped up in the main costal towns? In Los Boliches, it is fair to say that Estate Agents have somehow managed to out number banks by 2 to 1 and REAs and Banks together account for probably 50% of the main shopping street……. only 5 years ago still a relatively nice (almost) typically Spanish Pueblo. There can be only one answer – there is one hell of a profit to be made in the “game” hence the reason that it attracts so many butchers, bakers and candlestick makers along with failed bar owners and disillusioned Time Share staff!
Let’s hope that within the next year the Spanish Authorities tighten up and all Real Estate Agents have to conform to regulation, registration etc at the same levels as the UK. In fact, the professional and qualified REA’s out there, why not start the ball rolling by pressing for legislation and control equal to that in the UK? Surely honest REA’s have nothing to fear? Surely only good can come from it? With 70% of REA’s forced out of business as they will not be able to conform, that will take away the claims of so many agents that high (or should we say day light robbery) levels of commission are needed because there are too many agents spreading the client base too far.
-
Hi Paul and Lynn
Whilst I agree with your comments in the main I do disagree with the cost of sale for an agent in the UK compared to here.
Firstly let me state this is in no way trying to justify high commissions in any way – just to put into perspective what an agent here has to do.
As has been mentioned our catchment areas here are for more excessive than in the UK. I cover between Moraira and Valencia a coastline of about 200kms. Most UK agents will be lucky to cover more than 5 miles from their office.
In a typical week I list between 5 and 10 properties as do my staff (we are 3 in number at present). This week I have travelled a total of 800 kms just listing properties and showing clients round.
We also offer valuations of the property (and generally wont take any on that are way over priced)
We occasionally pick clients from the airport – a journey of 200kms round trip, with toll charges amounts to about 40 euros.
I also put clients up in my other apartment at no charge and NO obligation. I even point out the good agents and not so good agents in case they want to visit another agent. (Why you may ask – well if they are going to use another agent they will do it anyway and it is best they don’t get ripped off. But the reality of it is when you are transparent and up front with people they stick with you)
For marketing we use at least 10 internet sites, which we place most of the properties on, as well as our own.
We maintain a list of some 150 clients actively looking for property and contact them as soon as anything of interest comes up
We produce a weekly property flyer which we drop at the local markets.
We have a 901 number that is answered pretty much all day every day (mostly it diverts through to my mobile)
We go to the markets asking people if they are interested in buying a property.
We have a mailing list of 1,000 which receives a monthly newsletter (by the way I was registered with a number of UK websites and seldom received a regular newsletter)
We generally respond to enquiries within 48 hours – although sometimes it has been as quick as 30 seconds.
We provide regular free to attend property clinics which discuss many related issues – health care, driving, working etc. Free to attend by anyone whether buying or selling a property
We advertise in all the decent local papers as well as some not so local.
We have a list of professional investors who will purchase property with cash if the property is priced right
We arrange mortgages for clients
We take clients to the Police station to arrange their NIE number
We arrange bank accounts for them
We do basic checks when we list a property such as is the person selling it the one on the escritura, is the property as described in the escritura, is it legal, is it Urbano etc).
We provide very high visibility for sale signs in English and Spanish.
We offer a free translation service to clients from English to Spanish and for any other Language at a small cost – this is around 10 Euros per hour as we have to oursource this.
We change the bills, telephone lines, et al into the new clients name
We will assist the client to find schooling and if need be help them register their children
We assist them in registering for a SIP Card if need be
We will assist them to register for Social Security
All of this as part of the service. I do not think we are unique in most of what we offer, most agents do a similar amount of work
In all the houses I have bought and sold in the UK (and there have been a lot – certainly more than 15) I cannot remember the name of one estate agent because they never kept in touch after the sale and I never bought or sold with the same agent twice.
I can name at least 80% of the customers I have sold to over the past 3 years as most of them are now friends
So to say that we do less than the UK counterpart I think is an insult to most estate agents here. I agree that some do nothing at all and expect the client to do everything for themselves, but most agents are basically decent (some may be misguided, or ma informed but generally decent) and do a lot for their commission.
As I said this is not a justification for high commission, but I do believe that we do a lot more for our clients than our UK counterparts.
Regards
Vince
-
-
Well this topic is getting to be dominated by salespeople rather than vendors concerned about high commissions. to get back to the original thread. If you have to pay money upfront for the agent to put the property on their listings you have given them a virtual exclusive as how many other agents are you prepared to pay upfront to list it at around 1000 euros. This thread is sounding more like some of the postings on Crimeshare which consists of dubious salespeople (loose term) chewing the fat. Vendors don’t give a shit what the salespeople get paid they just want a fair deal and a sale.
-
Agreed Katy enough said I think we all know the scores on the doors final thoughts about Spanish estate agents
http://www.ft.com/cms/s/45e5638c-c0a7-11da-9419-0000779e2340.html
http://www.rightmove.co.uk/template/publicsite,help,guides,overseas,YourBudget.vm
http://www.moneyweek.com/file/15752/the-invasion-of-the-estate-agents.htmlguess its not just a spanish issues
Regards to you all and lets hope we can add value rather than volatility
Jim
-
-
If an estate agent knows the seller will sell through them and not one of the 5+ other agents they have it listed with they are more likely to spend money marketing it and offer lower commission like the UK.
The idea you can list your home with as many agents as you like instead of a sole agent works to the detriment of the seller who’s not going to go to a lot of time and expense when there’s an 80% chance it will be sold elsewhere. He may prefer to focus his time and efforts on off-plan
-
@spain wrote:
katy, this thread was about high commissions charged yes, but those high commissions are charged by the REA´s and sales people, so surely they have a right to come on herew as well and chew the fat….no?
If it goes to a vote, I would say…NO!
11 pages worth is tooo much chewing…..IMO. 😉
-
-
im sorry claire but at the end of the day, it is the sales people who are going to sell your property (hopefully) and if they keep leaving cos theyre not getting paid commission, and nobody wants to deal with viva cos the percentage is too low, then although as someone put here”we don´t give a shit what they get paid”, i would say thats a highly integral part of the job and the eventual sale of a property, especially through viva if their payment plan works that way
-
-
Just got back from a small holiday and read Chris is response…..
@Chris McCarthy wrote:
Hi again Fuengi,
I am afraid you have hit a bit of sore spot with me here, and this will probably open a whole can of other worms, it has been a long week being on here, and I have tried to do my best to be clear, concise and precise, but if you really do want the answer to this one, I am afraid you are going to have to suffer my longest response yet.
Then I hope to be off home.
I have previously mentioned that sharing amongst agents does not work.
It simply does not work for the vendor or the buyer, even at 5% that would be 150% more cost to both vendor and buyer, but even that does not work, the IN as an original concept was about agents “working together and winning together” but the reality became to our minds something entirely different.
That makes no sense. Now a 200.000€ property will be on the market with you for 206.000€ whereas at 5% its at 210.000. EXCEPT with viva you have to pay 400€ upfront. And the other agent works on the no sale no fee basis. EVEN then you might be able to drop the commission slightly.
@Chris McCarthy wrote:
Many, agents sought to use the IN as a vehicle to simply generate clients by saying that they had 7,000 or whatever number of listings, but they didn’t themselves have anything like this number or an equal share, the average IN member had less than 30 listings, we ourselves have 100 times that number, our nearest competitor / co-agent had something like an average of only 350 properties we have 10 times this number.
I’ve found out that viva had 2.700 properties on the IN. That leaves about 5000 with the other agents. That 2700 properties spread out over 14 offices. That’s approx. 192 properties per office.
There are what, another 60 offices that were part of the IN? That about 83 properties per office. So you have double the properties per office. This is of course an average. And that not counting their non-in listings.@Chris McCarthy wrote:
Did they really work as agents all of these people? Did they invest in listing and promoting? How many agents actually advertise properties locally? How many sales do they have to make to protect a good living at the expense of the vendor and the buyer? With what real promotional activity or effort? Do they promote the fact that they have resales yet actually prefer to sell new developments only?
How much does viva advertise? Except for the SUR in English where you have a large section, I see no more advertising from Viva than I do ADH or any other ex-IN agent. In fact I know that some of the smaller agents on the IN a far more aggressive on the internet which is supposedly a superior advertising medium than print.
@Chris McCarthy wrote:
How many of their clients did they actually bring to ourselves to show properties, and how many times did they use the listings of ourselves and other agents to convince clients that they had seen it all on the system and there was no need to view? Were our own clients and listings being best served by the activities of others?
Very valid argument. As the majority shareholder in the IN, should you not have instigated procedures/rules to prevent this?
Curious not not other agents maybe say the same about viva?@Chris McCarthy wrote:
How many listed all of their properties on the IN network or actually kept how many listings in the drawer so that vendors would believe they were on the network, but were actually being kept away from the network because the agent believed a sole agency sale was preferable for them? How many of these agents were prepared to listen when I actually told a number of them to go on to the Spanish Property Insight and just see what vendors and buyers thought of them, us and our practices?
You tell us. Unfortunately you’d think the vendor would not have had so much trust on costa del sol agents.
And except for about 3 IN agencies, I have not seen any of the other criticised in the least. Wow only the big agents that. Guess who they are.@Chris McCarthy wrote:
How many of these agents are also dedicated Spanish Estate Agents? Or how many are better described as so called “International Agents” selling worldwide on the tired old mantra of investment, investment, investment, because that is all they know, but find it most handy to have the presentation that they have a base business here with so many thousand listings, yet turn those interested clients to Morocco, Bulgaria or wherever?
It does seem to be following the investment craze. So how many ex-IN agencies are “international” then?
@Chris McCarthy wrote:
I have to be really careful here, because I consider a good number of IN member agents to be friends of mine, people I like and know are good people, and I don’t wish to be seen to be knocking or denigrating them or their individual businesses. I am talking collectively here.
So your collectively denigrating them? I like the word collectively instead of generally. Clever.
@Chris McCarthy wrote:
A whole bunch of them are now looking to form another version of the IN and I am led to believe are now going to pull down their own rates to 5%, well I think we did that for the vendor and buyer, and we ourselves are funding the continued background operation of the IN to do our absolute best to ensure that none of these members lose their software, access to their own properties and their functionality until an orderly transfer can be made to their own dedicated system.
But neither viva nor the IN own the software, from what I understand it is own by infocasa. So what are you funding and supporting? Have you not simply screwed them over by pulling out so quickly?
AND from what I’ve been told, dropping the commission to 5% had been proposed before but was vetoed by the majority shareholder. mmmm@Chris McCarthy wrote:
We support them in whatever they wish to do, but the simple fact is, our clients were not best served by dealing with other agents, and ultimately we could not change our proposition by being involved with other agents.
Huh? So its not in the vendor or buyers interests to have more choice?
@Chris McCarthy wrote:
We had to leave the IN, and the IN as it is, was not viable without us, so it has to go and be now replaced by another entity, will it work any better without us? Will we now compete? And if we do, is that not a good thing for the market?
So you unilaterally closed down the IN with no warning? Of course the IN could not function without you, you’re the majority shareholder. Why not simply pull out and sell your shares instead?
@Chris McCarthy wrote:
Let them get out there and promote, let them get out there and spend some of their revenue, but for us, we became fed up being called one of the big boys, the fat cats, the abusers of vendors and buyers, we now would just rather offer our service and be responsible for our own actions and not be necessarily linked to others.
That’s something at least
@Chris McCarthy wrote:
The thing is we believe in fact know for sure that we sell far more properties than any other agent, we list far more, we promote far more, and in this past week without other agents our clients have benefited by our selling in excess of 30 properties, we will see who wins here, but I think the vendor and buyer have already started to win, and we are pretty happy too, yet.
Wow 30 properties. Curious were they all at 2%.
You have 14 offices, of course you sell more than any one other agent.
Oh and I saw the new viva advertising, I assume every property in there was t 2%? And you would be willing to back up this by showing paperwork? Since your all for the interests of the vender and buyer?@Chris McCarthy wrote:
The average agent response seems to have been furious and indignant, our staff are being harangued everywhere, restaurants, petrol stations and over the mobiles, many agents are absolutely hopping mad, they think we are destroying the market, the key comment they come with is “What are we going to do now, what’s going to happen to us”.
Yes business men (if we can call them that) running up to you saying this. You think viva had more than 14 offices out of the total 1500 present on the Costa del Sol. Poor Don Piso with their 500 offices nationwide, etc…
More than likely I’d see other agents saying “what the F*** are you doing? We joined the IN, had to implement you commission structure and now you dumping us all in it and droping to 2%”@Chris McCarthy wrote:
Yet, let me tell you the most common response from vendors is, if you will pardon the slight profanity, they are saying “About bloody time too..!”
YES!! Viva have not sold my friends property in over 6 months. So about bloody time you ask for money up front!
-
I’ll say one thing though chris mcarthy is a smart bloke. He come on this site made it seem like he’s battle the bad agents with the high commissions (implemented by him) and hate the idea of dodgy offplans (which he’s already been caught out about).
Me thinks he’s looking to generate some interest or maybe free advertising from our resident doctor Mark Stucklin.
Mark if you are reading this, did not chris write an article about reas = prositutes?
What would you prefer a prosi that charge a respectable sum or the one that charge less than half what her friend is charging, but expects some of it upfront? -
The guy is very smart, that’s for sure. Everyone I know agrees on that. He must have calculated very carefully what he is doing.
One thing is for sure, he’s going to wipe out numerous small surviving REAs with such an aggressive commission policy. Almost like “dumping” (selling below production costs(=publicity, marketing, huge overheads etc..) to eliminate rivals and then putting prices back up).
Normally I don’t defend REAs but VIVA does spend on publicity Fuengi.
Have you seen all the Portillo buses with HUGE VIVA signs on them ?
Have you seen huge roadsigns from Málaga to …Manilva with VIVA on them ? etc…
-
At the end of the day NO REA can justify a 32,000 Euro Commission to sell a town house in Fuengirola/Benalmadena – that is just daylight robbery.
In fact, IT IS NOT A COMMISSION – it is in fact an agents mark up. My price for my house is 335,000 and the agents want to ADD AN EXTRA 32,000 (just over 9.5%) to place the property on their website
I can tell you I have had more enquiries from my own little website, created at a cost of less than 5 Euros for the domain name and hosting than all the IN network can produce for 32,000 Euros!
A good REA could sell the property and make a very healthy profit on a total mark up of 5,000 Euros.
-
@Drakan wrote:
The guy is very smart, that’s for sure. Everyone I know agrees on that. He must have calculated very carefully what he is doing.
One thing is for sure, he’s going to wipe out numerous small surviving REAs with such an aggressive commission policy. Almost like “dumping” (selling below production costs(=publicity, marketing, huge overheads etc..) to eliminate rivals and then putting prices back up).
Normally I don’t defend REAs but VIVA does spend on publicity Fuengi.
Have you seen all the Portillo buses with HUGE VIVA signs on them ?
Have you seen huge roadsigns from Málaga to …Manilva with VIVA on them ? etc…
Drakan, you are absolutely right. Whos has’nt seen those buses with the dolls (?) on them!. But chris said:
@Chris McCarthy wrote:
Did they really work as agents all of these people? Did they invest in listing and promoting? How many agents actually advertise properties locally? How many sales do they have to make to protect a good living at the expense of the vendor and the buyer? With what real promotional activity or effort? Do they promote the fact that they have resales yet actually prefer to sell new developments only?
Viva spend ALOT of money advertising themselves, that’s for sure. But except for the SUR where do they advertise PROPERTIES?
And before someone says it, i know its important to “sell” the company, etc…
Chris seems to be trying to differentiate his company from the other “big” biys. He seems not different whatsoever. -
-
-
All this talk about reducing rea fees on resales is a joke.
Many developers are increasing their coms to agents because of the down turn. At Arenal 2000 its 10%, others are between 6 and 12%. Please dont expect any comission only sales person to sell your over rated re-sale for 2%. Even the deposit needed to buy a new development, is down; in many cases to 20% at PPC.
I can only think that Viva is trying to gain publicity and pretend to be the nice guys in this situation.
-
I have been reading this and other Andalucian forums for a while now as I am one of the 50,000 or so Brits planning to buy out there within the next year. I have read, here and elsewhere, all the terrible stories people have about the estate agents operating on the Costa del Sol – they are clearly just as popular as they are here in the UK! I have sat and read this long long debate and was pleasantly surprised that all the questions about VE’s new system were being clearly answered, and straight from the horse’s mouth as well. As a prospective buyer, anything that brings the prices down has to be good, IMO.
So I was really quite disappointed to read Fuengi’s lengthy post above, just picking apart the break-up of that agents’ Network and really not making any comment about how it might affect the people who are surely the most important in the real estate market – US, their clients, the buyers and sellers. So much sarcasm too. I take it that Fuengi is an agent with an axe to grind, given the information they have. Methinks s/he protesteth too much. IMO this thread was doing a great job to show the benefits to the general public of the lowering of commissions and therefore sale prices. VE’s boss came on here and faced the barrage of criticism and answered all the questions put to him. We all knew who Chris was when he came on here, not hiding behind any nickname. Who are you, Fuengi? Are you an agent? There must be something personal behind these bitter and angry responses you have made on here.
If these smaller agents have lost their big partner, then they need to move on and adapt in a changing marketplace. What’s wrong with change if it stimulates the market? VE have done what they have done. Shouldn’t it all just be about buyers and sellers getting a better deal? If the market picks up, sellers will benefit. If prices fall then buyers benefit. Is this not a win-win situation?? From my own point of view, I see myself as a winner out of it as I am seeing the prices of property reducing before my very eyes.
-
Speaking as someone who has had their house on the market for a while, I would be willing to try Viva’s approach. I recently had a potential sale but the agent decided to take a low offer BUT kept his entire 7.5% commission. Needless to say I was underwhelmed by his attitude. He was actually making more profit then me – this is despite the fact I was interested in purchasing a more expensive property from him. I had stated my minimum net amount to me up front because of this new purchase and mortgage.
So on my resale he got nearly 40kE and he would have made 50K (if he was taking 7.5%) where as I would supposed to drop 30k off my nett price – basically selling at less than inflation over 5 years. He pocketed 90k from me and I took a 30k hit. 😈 let me just repeat that NINETY THOUSAND EUROS.
Had he taken 2% commission my Hit would have been acceptable and the house would have sold. WIN WIN for all concerned.
I shall certainly be considering seriously the VIVA offer – they have already sent me over their figures on my property to look at.
It would certainly generate more resale properties coming on the market?
-
That is totally disgraceful Banushouse.
I was under the impression that agents used their “high” commission to act as a buffer so vendor received the asking price. Obviously not in this case !!.
However although you have told informed us of this situation how is this info going to stop another falling foul of this agent.
Appreciate you can’t name names but surely you can highlight the area or even country involved which I have to assume is Spain as you prefer to be seemingly anonymous.
As you are now thinking of using VIVA what a good job Chris was permitted to state his case.
Hope you have a successful sale , through whoever , next time -
-
So you are miffed that the agent wanted you to pay the fee which had previously been agreed by you. If you agreed to pay him 7.5% in the first place don’t start criticising anyone else.
You say that the agent wanted to take the lower offer – is this your house that we are talking about or have you very little decision making influence when it comes to offers?
You state that you have taken a “hit” on your sale price – well get used to it people. The market is not getting any better and every vendor needs to make the choice between speed of sale and price. You may look back in 6 months time and be very thankful that the sale went through.
The problems arise when vendors dictate that this is the “net” figure I want for my house – then the agent adds his fee on top. If you don’t know what fee he is charging then again who’s fault is that – I certainly wouldn’t hand over the marketing of a very valuable asset to someone I didn’t bother to ask about fees.
As for agents using their fee as a buffer? Well what gave you that idea Melosine? Agents charge a fee for their service and if they can get away with charging exhorbitant fees then they will. Unless the property industry is regulated the only people who can control this is the vendors that instruct them in the first place.
Blimey I’m off for a lie down to relax. This forum really does wind me up at times.
Good post from Iain by the way – I agree. Thankfully there is absolutely no sarcasm in my post. Not any. None. Nada. 😉
-
Aunty Val,
Don’t rest just yet…well not until I have time to reply.Because of all the controversy on this site about agents fees I thought I would check out those I know well in my rural area.
They all acknowledge between 3% and 5 % and it was some of these agents who said, because times are slow, that if necessary they would use their commission as a buffer to make a sale so the Spanish vendors would get the asking price. Maybe SV makes the difference
However I did mention it was only hearsay and didn’t know if it had ever happened .Heard yesterday that apparently some are now changing their technique and like UK the Spanish vendors are agreeing to pay the commisson fees. This I think the most sensible option as long as you ask and agree to what the commission is prior to signing a sales contract.
Should make property prices more sensible. Looking at the sites sent to you I am amazed anyone gets a sale in my area .Prices are ridiculously high.Okay have a lay down now
-
-
PostPosted: Fri Sep 01, 2006 4:46 pm Post subject: In response to the banushouse post
So you are miffed that the agent wanted you to pay the fee which had previously been agreed by you. If you agreed to pay him 7.5% in the first place don’t start criticising anyone else.You say that the agent wanted to take the lower offer – is this your house that we are talking about or have you very little decision making influence when it comes to offers?
that would be it – yes – the agent “offered” the lower price to the guy without asking me DESPITE knowing that I needed a fixed price to buy a new property. In case you missed the point my house was on for a price which had around a 10% buffer to allow for offers. after the commission Far enough. The agent then suggested a price to the potential buyer that I would take, this was have left me with minus 10% buffer, minus the 7.5% commission and with a further 30k loss – and the agent decided to throw in my furniture (without asking my permission) However the agent was taking 7.5% of the original price, and at this point I didnt not have a document aqreeing to pay him 7.5% at all ! As the property was not listed originally with INS network. That was something he threw in later as the Buyer was registered with another agency. So a bunch of crap which is typical of the CDS market.
And before I get the get real about prices lecture. My house was already cheaper than 2 similiar houses near by.
I dont think it is unreasonable to expect a professional service from an Agent. i.e. discuss stratagy with the vendor, take commission from the lowest price not the orginal advertised price. Help out with the current extremely complicated problems with the Marbella property market.
And I can contrast this experience with the POSITIVE purchase of my 2nd house which is inland.
Spanish Agent – first thing he does if to check legalities, goes down town hall, does a survey of the house to get the Spanish Eqv of a UK Buyer Pack, which as our Spanish Lawyers will tell you is a legal requirements for ALL REA to provide to a seller. (ha ha ha)
When we agree on the sale we pay 2% commission the seller pays 2% commision. The Agent for the seller came around the house with me to see if I had any problems before sale went through – we had all the electrics/pumps tested by the seller. The vendors REA and my agent went to dinner with us to make sure we understood all the various taxes and payments, went with us to the Bank for the transfers (it was a rural spanish town and they wanted to make sure their where no problems – (yes it was in their interest but you dont expect it after dealing with the Big British REA)
When we went to the notary we where a crowd of about 10 people, all the documents where translated by both the agents, and I was able to ask questions to either agent with the Notary agreeing or disagreeing with their opinion.
An altogether more professional experience, now we are think about selling this inland house, we called the Agent, and the first thing he did was to ask about the buyer pack, and go to town hall to find out information about pricing/taxes/planning issues for the area.
He will be charging us 2%, he will be advising us on the price to sell the house based on other sales in the area, he will advertising on a website and in his office for this 2%. And yes I expect he will want his fee in cash!
-
So, you are comfortable dealing with an agent that takes 2% from you and 2% from the vendor – who is the agent acting for? You or them?
Maybe the agent that you are selling through has a similar situation – he may be getting something from the buyer which orientates his negotiations towards the buyer. At the end of the day it is your decision as to how your house sale proceeds.
You can’t have it both ways I’m afraid.
-
@Iain wrote:
So I was really quite disappointed to read Fuengi’s lengthy post above, just picking apart the break-up of that agents’ Network and really not making any comment about how it might affect the people who are surely the most important in the real estate market – US, their clients, the buyers and sellers.
Hi Iain, I fell quite privileged that after you have been reading this site for so long, that your first post is aimed at me.
Of course we are the most important part of the market, we are the people that generate the revenue for these companies!
Oh, and a lot of us have at one time or another had our property on the agents network. A lot do at the moment. What happens to their properties?@Iain wrote:
So much sarcasm too. I take it that Fuengi is an agent with an axe to grind, given the information they have.
By that same logic, so are the posters “katy” & “dodgson”, as they appeared to be the first people to know about the commission change. Information is surprisingly easy to get your hands on. All this information came through a few friends that work/ed for viva.
@Iain wrote:
Methinks s/he protesteth too much. IMO this thread was doing a great job to show the benefits to the general public of the lowering of commissions and therefore sale prices. VE’s boss came on here and faced the barrage of criticism and answered all the questions put to him. We all knew who Chris was when he came on here, not hiding behind any nickname. Who are you, Fuengi? Are you an agent? There must be something personal behind these bitter and angry responses you have made on here.
First of, as I understand it, this forum is not an advertising site for real estate agents.
Second a poster with the name Chris McCarthy wrote on this site. We have no proof that it was him or a PR person, or even myself with a different login.
Thirdly, who I am is of no importance. I’m a homeowner in spain, in Fuengirola. I don’t work for an estate agent. I bought through an ex in-member though. If you want I can supply a name, but how would you know if it was mine? Want an N.I.E. number as well?
Fourthly, bitter and angry? How so?
Oh, and something that might be of useful for you to know:fo•rum (fôr m, f r -) Pronunciation Key
n. pl. fo•rums, also fo•ra (fôr , f r )
a. A public meeting place for open discussion.
b. A medium of open discussion or voicing of ideas, such as a newspaper or a radio or television program.
2. A public meeting or presentation involving a discussion usually among experts and often including audience participation.Sorry that I don’t simply bend over when Real estate owner comes onto this site deigns to talk to us. I do not criticize, I simply want clear answers and not a well rehearsed PR campaign. Now we just need M** and one or 2 others to come on this site 8)
I also feel that I had some valid points no?
Hell I hope Chris comes back and answers my post. It can only be a positive don’t you think?@Iain wrote:
If these smaller agents have lost their big partner, then they need to move on and adapt in a changing marketplace. What’s wrong with change if it stimulates the market? VE have done what they have done. Shouldn’t it all just be about buyers and sellers getting a better deal? If the market picks up, sellers will benefit. If prices fall then buyers benefit. Is this not a win-win situation?? From my own point of view, I see myself as a winner out of it as I am seeing the prices of property reducing before my very eyes.
Have they lost their “big partner”? From what I’ve been hearing viva, or at least the sales people, are still trying to sell other agents properties for the higher commissions. Although this might only be in that office.
How, where are you suddenly seeing prices drop?
On average properties on the Costa are supposedly 30% over priced. Yes a drop in commission is a good thing. I means less added onto the property, etc… But maybe, just maybe people have to actually drop their prices or improve the quality of their residence. -
-
-
-
Did anyone else receive a copy of this very interesting email below, written by Alasdair Kennedy?
“CAUGHT UNDER THE COLLAR
GREAT NEWS FOR CONSUMERS OR A CYNICAL MARKETING PLOY?
Over the years, VE have been quick to criticise their competitors with various ‘exposés’ published in their Hot Properties magazine. Victims of their often vitriolic attacks have included winners of various prestigious real estate awards, anyone selling property in Bulgaria and more recently fellow agents on the Costa del Sol have been damningly described as ‘prostitutes’ for charging over the top commissions.
So, as VE launch their new campaign to sell property on the Costa del Sol at ‘only 2% commission’, does this campaign prove that VE really are the noble philanthropists they claim to be, or is there something far more sinister lurking behind the marketing promise? Does their offer stand up to scrutiny and more interestingly, how will they react to being the subject of an exposé rather than the indignant and horrified whistle blowers in their ‘Hot under the Collar’ articles? VE sure like to ‘dish it out’ but the big question is can they take it?‘THE 2% COMMISSION REVOLUTION EXPOSED’
Very recently, VE launched with a massive fanfare their latest marketing initiative, claiming a revolution for buyers and sellers alike by offering to sell properties at only 2% commission, whilst the other ‘greedy’ agents were selling at anything between 5 and 7.5%. So far so good, but then dig a little deeper and you’ll find the first big catch.A HIDDEN AGENDA
Property vendors can list their home at a 2% commission in the event of a sale but they have to agree to let VE do the legal conveyancing. This is obligatory so it’s a case of ‘no conveyancing, no listing.’ The legal conveyancing fee is set at 1% of the property purchase price and 20% of that amount has to be paid up front by the vendor. The minimum up front payment is set by VE at 600 euros and the maximum at 1,000 euros.So, VE will very kindly list your property at a fee which undercuts every other agent, but they want cash in advance to do so! Now you may start to get a whiff an ulterior motive. VE have recently mobilized their entire sales team of around 80 reps to go out and list properties. So if the sales teams are all out listing, who’s doing the selling? Are VE really interested in selling the property or do they just want the up front fee?
QUICK CASH FOR VE
As VE like to say in their own advertising, ‘Do the math’! With a portfolio of over 3,000 listings built up over 8 years in operation, could it be that they just want to turn their listings into quick cash – potentially 2 – 3 million euros worth just from their existing portfolio! And if they are so busy doing that, then what chance is there of any individual vendor seeing their property sold? There’s always going to be a far greater number of properties being listed than sold, therefore the vast majority of vendors are going to be paying money up front with a high numerical risk of being sorely disappointed.LEGAL ETHICS
Also, surely there’s something unethical about tying the vendor into an agreement to let VE do the legal conveyancing. Doesn’t that smack of ‘conflict of interest’? Not the type of enforced contract one would expect from a consumer champion who espouses the importance of impartial and independent legal advice in much of their publicity.WHAT ABOUT THE BUYERS – SURELY LOWER COMMISSIONS MEAN LOWER PRICES?
At first glance yes, but here’s a very sobering fact. VE started their 2% listings campaign only a few weeks ago. They are estimated to have converted less than 200 of their 3000 strong listings portfolio onto the new rate. (They won’t convert a listing unless the vendor pays the up front conveyancing fee). That means that well over 90% of the properties they are marketing are still at their old commission rate of 7.5%.
Could it be that the 2% promise is merely bait to lure unwitting customers into buying the higher commission properties? Whilst they will be enticing customers in on the premise that they can buy cheaper with VE than anywhere else, the reality is that buyers will most likely end up buying a property at a much higher commission rate.Alternatively, if VE do really stick to their guns and only sell the lower commission properties, it means the customer suddenly has an extremely limited choice of properties to view. So whilst VE claim in their current advertising to have a larger portfolio than everyone else, there’s a massive contradiction here. Either they’ve got a big portfolio of 3,000 properties (but on two completely different commission rates) or a tiny portfolio in the low hundreds if they are only prepared to sell at the lowest rate. So how can they claim to have both at the same time in their advertising? It simply doesn’t stack up.
IT’S NOT THE COMMISSION LEVEL, IT’S THE PRICE THAT COUNTS.
Any agent worth their salt will tell you that the key to listing at the right price is accurate and professional valuation. Valuing a property correctly so that it can be sold at the right market price is a highly specialised job. It’s not as simple as asking the vendor what they want for it. That normally leads to over valuation as everyone thinks their own property is worth a lot more than it really is. A good valuer will calculate the right price according to their experience and intimate market knowledge and not be swayed by the unrealistic expectations of a vendor.That leads to the question of why VE have now mobilized their sales team to do the listings rather than using professional valuers. Will the sales team just be interested in picking up a commission on the up front listing fee or will they be genuinely interested in listing the property at an attractive market price? Are buyers getting a better deal buying a 300,000 € property at 2% commission, or are they better off buying it at 290,000 € with a 5% commission to the agent? It’s the end price that’s important, not the commission level to the agent.
A WOLF IN PUPPET’S CLOTHING
VE have never made any secret of their ambitions to dominate the property market, put their competitors out of business and be the biggest most successful agent on the coast. Yet at the same time their entire marketing and publicity drive to the consumer is devoted to portraying them as approachable and friendly to the point of being naïve. The happy puppets on their cars and billboards are patently childish and playschool-like. How could such disarmingly friendly people as VE possibly have any financial motives or want to relieve customers of their hard earned cash through any form of sophisticated sales technique?VE have worked very hard and spent a lot of money to come up with a brand image that tries to distance themselves as much as possible from the popular belief that real estate agents are sharks. Yet behind the scenes is a well-oiled and aggressive sales and marketing machine that is highly target driven and profit orientated. Isn’t that approach just a little disingenuous? A business can be very successful and offer great service, honesty and professionalism at the same time, but to pretend you’re not even the slightest bit wolf-like is surely just trying to pull the wool over everyone’s eyes.”
-
Even before I read the pro’s and con’s on this thread I had decided never to pay an agent an “upfront” fee.
Once they have it what guarantee has one got a sale will ever proceed or even promoted ?
Absolutely none.
Where’s the incentive to sell?
Chris stated his sales force have to achieve a certain target. How will anyone know if they do or don’t.Surely at the end of the day it is the vendor who has the power to stop agents over charging by requesting a contract confirming the price their property will be marketed for.
Don’t like it …don’t sign . Agents will soon get the message that adding the same percentage of commission on a property market that has seen considerable rises in recent years spells extinction for them.
Vendors…You have the power…use it. -
We bought our El Soto property from Viva and were very pleased with our agent’s assistance and with the overall professionalism of the company. In a couple of years we will be in the market for a villa, and will not hesitate to return to Viva. The 1% conveying charge and the listing deposit amount for resales does not disturb us in the least. We prefer to deal with a reputable, concerned company regardless of the commission, rather than run the risk of being eaten by some RE shark as seems to be too often the case in Spain.
If some smaller agencies have to close down, so be it. In every market shakeouts occur. When you have too many of anything, inevitably some will go out of business.
We live most of the year on the Med coast of Turkey in what was a charming, undiscovered village hugging the shoreline of a gorgeous bay. That was until it was discovered by tour operators. Now we have 120+ restaurants, hotels & pensions in a tiny town of only 1500 inhabitants.
This year the tour operators pulled out as too many tourists bought homes here and no longer travel with the tour operators. Result is that about 50% of those small restaurants, hotels and B&Bs that depended on tourists are out of business. Every day now another one closes for good.
Many of the owners are friends. We feel very sorry for them. But there is a lesson in all this, whether it be REAs, inn or restaurant owners: don’t flood the market. The most fundamental investment rule: don’t put all your eggs in 1 basket unless you want to lose them all.
Don & Carole Warner
http://kalkan-turkey.com -
Well, time to throw my two cents onto the fire. While the decision to employ this reduction in commission structure may have been taken for a number of reasons, there is one reason which has been used to justify it which is total codswallop and just has to be called out as such.
The 7.5% commission is not what makes or prevents your property from selling. The same way, a lower 2% commission will not sell your property by itself. What will sell your property is the real estate agency you are working with if you chose to work with one at all. Of course what can prevent the sale of your property may also be determined by whom you placed your faith into.
I’m not sure how many of you read anything but the forums on this site? There is a lot more information available here than just the opinions of informed (or misinformed) vendors and REAS. Sure, It’s a great read, often amusing yet unfortunately also sometimes distressing.
However, no matter what the price of your property, the difference of 7.5% to 3% is a total of 4.5%. The goal is to sell your property and make you the vendor the largest possible profit within the shortest possible time frame and with the least amount of hassle. That is your goal.
Lets imagine your property is worth 100.000 € If REA1 sells it for 103.000 € or if REA2 sells it for 107.500 € is 4.500 € going to make or break the deal?
Your property is worth 1.500.000 € or more. In that case, the standard commission is around 5%, according to the now extinct MLS standard operating procedure. So we are then discussing either 1.575.000 € or 1.545.000 € Now, if you have 1.500.000 € to spend, will 30.000 € make or break the deal? I’m sure something can be negotiated and a deal can be arranged if the buyer is the right one for that property.
What will make or break the deal is when you decide to put the property on the market and you chose to talk to Joe Bloggs who stepped off the bus in Málaga last week. Now Joe has done no research into the market, Joe is under pressure to sign x contracts per day to earn enough money to survive and Joe knows he probably won’t be around in a year when you are going to complain that the property isn’t sold anyway because the turnover at his company is how it is… Joe’s first priority is to keep his job and feed his 15 children and his wife and two mistresses.
Someone said: put the property on the market with as many agencies as possible and fight for a lower commission and make sure that…
Want some good advice? Yes, speak to as many agencies as possible. Get as many valuations as possible. And when you have, decide who you want representing your property and who you have confidence in to sell your property. Don’t be blinded by the € signs. Don’t sign with the REAS who says he can get you 2.000.000 € when everyone else says they can get you 500.000 € Not only because of that at least.
Why? Because there are too many agents out there who haven’t got a clue what the value of a property is, even more who don’t care and both of the above are 100% dedicated to getting your signature on a piece of paper so that their bosses are happy and they get to keep their job a few months longer. Heaven forbid they find themselves unemployed in Spain and have to go back to being unemployed in (insert country here)
What happens at the moment? You get greedy. You go for the big bucks. You decide to sign a contract with the shiny eyed 20 year old fellow who only just walked through your front door 2 minutes ago yet already “knows the exact client for this property” and not only that… His company “has clients lining up to buy properties like this one” and he is “absolutely positive” that it is worth xxx € (normally 50% higher than his competition.) Of course he does the best possible solution would be for you to tell him how much you want for it. He wants you to tell him. Because in some extreme cases they haven’t got a clue if he should say 650.000 € or 250.000 €.
Once you have told him, he’ll agree, possibly test the waters to see how susceptible you are to signing a contract and then either “bribe” you with a high valuation if he sees you are not too interested or just agree to what you want if you seem eager to sign.
6 months to a year later (if not longer) you realize that there have been no marketing activities done, no clients have viewed the property and the shiny eyed fellow who came past your house and spent a whole 2 minutes to tell you how much to sell it for doesn’t actually even work for the company representing your house any more. You decide to try again, you lower the price by half and call up agencies to ask for a valuation. There is a knock at the door. Standing at the front door to your house is a long line of shiny eyed fellows with large grins and in their outstretched arms you see lots of contracts and byro pens.
Or possibly you awake 6 months to a year later to realize that not only do you find yourself in the position described above, but you’ve also paid him money up front. Good luck!
Want some advice?
1) Set more than a weekend aside to discuss the sale of your property with local REAS and do exactly that. Don’t call in on the last day of your holiday two hours before your flight and demand that someone see your property immediately because odds are you will get the junior coffee maker from the bakery next door’s second cousin whose Spanish real estate experience is comprised of that one time he “did the washing up in a Spanish restaurant on Exeter high street”. Ask questions about the state of the market. Interview the professional sent into your HOME about the state of the market in the area your house is in. Discuss how the market has progressed. Take notes. Compare notes between the REAS you speak to and call them out on it. Challenge them. Tell them what the last person said and ask them to comment. Treat them with respect (right up to the point where you throw them out) and demand their respect in return.
2) Don’t be bribed by the highest valuation, challenge the price.
3) Use your brains… Think for yourselves. Ask questions about how they are going to sell it. What are they going to do to sell your property?Now I am not saying that Chris and his company are shiny eyed boys. However by demanding 28 signed contracts a month he is asking them to sign more than one contract per working day. The message is: We want your deposit. We WILL sign a contract with you even if we don’t believe your property can be sold.
If anyone says that the difference of 2% and 7.5% is what will achieve a sale for you, they are dreaming or trying to get you into that dreamy state where you will believe anything.
104.000 € vs 107.500 € won’t make a difference. But if your property is worth 104.000 € and your estate agent values it at 275.000 € and he writes down 142 m2 when you actually said 104.2 m2 … That will make a difference. And it’s not the difference you want. They real estate professionals who can help you sell your property aren’t all going to be signing 30 contracts a month and they won’t be working for 2%. Why? Because their work is worth more and their time is worth more
7.5% of a sale is better than 1% of nothing. Yes, some people who made bad choices and bought the wrong property from the wrong people were conned. Or they simply had bad luck. Possibly the REAS involved was also an innocent victim of his own negligence. These people will ultimately lose money and my heart goes out to them.
With all due respect there is a saying which springs to mind: “You pay peanuts…”
-
Hi Truthbites
great post and so on the mark.
I have just written an article in the local paper here in CB called “why is my house not selling” – and pretty much goes along those lines.
The probelm is that owners dictate the price of the property and agents seldom if ever give advice as to a realistic selling price. (certainly up here) The amount of times I have heard – “well three agents say it is worth 300,000”. And how did they arrive at that figure – because the owner told them they wanted 280,000
Excuse me but that is not a valuation. Certainly not based on any factors that the market consdiers – like the sqM and the average cost per SQ m for both land and building in that area not to mention what potential buyers are actually looking for. These are things which the banks consider, but agents only consider (in general) what the client states they want.
So the net result is that owners have properties they think should be worth X when the reality is they are worth less. But the agent doesnt care because he gets a listing, it keeps his targets and someone may even look at it.
And before I get lambasted for being an agent I also eat my own dog food. My own house is valued at 310,000 (and I have the tasacion) and I have dropped the price from 279,000 to 239,000 which has worked wonders as now at least people are looking (and one silly offer been made) . Before I wasnt fussed about selling now I either sell it or rent it, but at least the price is attracting people.
And secondly we do give valuations that clients can either accept or not – if not I am happy to walk away because there are enough over priced properties around and I want to sell property not list them.
Listing only, does no favours to the seller or in fact ourselves, whereas giving a reflection of the market – and a market appraisal so sellers can see where their property fits into what the market is currently demanding, are important factors for setting the valuation. In some cases by dropping your price a little you may just break into a level where many people are looking.
Up here for example there are some villas for sale at 280,000 or so. There are people looking for villas/chalets upto 250,000. We are a mere 10-12% out on price so if the owner dropped their price 10% we have buyers – but most just wont budge. So they have to wait until the market catches up (and I believe the market is actually falling in real terms)
So perhaps sellers need to take a long hard look at their property and compare it against others in the area that are SELLING – not just on the market. If your price is within 10-15% of a buyers budget they will generally look at it because it is in the ball park of a deal being made. But when a property is over valued by 30% then even 1% commission wont make a difference to whether buyers come or not.
Oh and one final point, if the deal is made or broken on 1% – 3% I am sure that most agents worth their salt will drop their commission to facilitate a deal- I know we do – a sale at half of what you expected is better than no sale at 100% of what you expected – or it least in my books it is.
Good post
Regards
Vince
-
Vbtudor, You have a lot of information seeing that you have only been an agent this year…8 months. I notice when you do post that you almost always manage to mention the properties that you have for sale.
Because the sales are thin just now it is in an agents interest to try to persuade vendors to reduce. Not all of them ask inflated prices, when my daughter put hers on the market we both did extensive research on the web. She refused to give the price to any of the agents who came round so she could obtain an independent valuation (except one who refused to give a price!!). She finally asked 25000 below the average valuations and is prepared to negotiate a small further reduction. Greedy vendors….
Dijo la sartén a la caldera (Pot calling kettle….) -
Quote:Because the sales are thin just now it is in an agents interest to try to persuade vendors to reduce. Not all of them ask inflated prices, when my daughter put hers on the market we both did extensive research on the web. She refused to give the price to any of the agents who came round so she could obtain an independent valuation (except one who refused to give a price!!). She finally asked 25000 below the average valuations and is prepared to negotiate a small further reduction.
Errr…excuse me…but if a vendor wants/needs to sell surely it is in their best interest to have the property at a realistic price to compete with the rest of the market.
If you were on the market and the agent just left you in the dark as to market conditions (knowing that you were over-priced) would you be grateful to him/her – I think not.
Agents do not create or influence (greatly) market conditions – they merely react to them.
As for your daughter – very sensible. Don’t tell an agent a price and get three valuations at least. Question them as to how they are going to sell and appoint the one you feel happiest with.
-
Hi Katy,
I think Vince was just making a generalisation, not all vendors are greedy, just like not all estate agents are sharks. However I recently went to list a property and gave a valuation of 750,000 (which incidently was within 10k of the valuation of 2 other agents). The vendor subsequently had another valuation from one of the big boys at 1 million and then insisted that we list the property at this price, needless to say we walked away. I have also seen properties that we have listed advertised for sale on private vendor sale sites, having croped our pictures and descriptions from our web site and for sale at the same price. So no Katy not all vendors are greedy but some are.
Jim
-
I sold a property with Viva, asked 15,000 euros more than they suggested, accepted an offer at 5000 less than asking price, so I suppose they weren’t far off, sold in 2 months. But that was in a healthy market. My daughter is thinking of advertising privately and asking 20,000 less than the agents asking price.
-
Katy
I used to be a buyers agent before I became a musician and I also write for a lcoal newspaper and have been writing articles on buying a property in Spain since I first came here – actually before that when I first bought. I have had a vested interest in writing about buying in Spain (and wrote a small book on the suject) for about 5 years. You dont have to be an estate agent to be interested in property – my dream when I moved here was to be a developer. Buying run down properties doing them up and selling them on. I happened to chance into being an agent because I developed a database )my previous profession was software) for an agent.
The property I mentioned in this post is my own and is to show that I dont expect people to do something I am not prepared to do mysel – ie drop my price to the current market level. As I said eat my own dog food
Yes it is in an estate agents interest to get the value to a saleable level- but is it not also in the sellers interest. If no one is looking at the property let alone putting offers in then surely this suggests one of two things – the agent isnt working for their money or the market doesnt believe this property is worth looking at.Whatever the media are telling us the real price of Spanish Property in this area is falling. They state it has risen by 10% in the past year yet this is the decalred value. Last year people were declaring 20-30% under value. This year becuase fines are being issued and foreigners generally wont under declare now anyway – the declared amount has risen – but the selling price has remained the same or in fact fallen. Thats not quite a 10% rise.
Your daughters example is I am afraid fairly rare (or certianly in this area). Most agents here (if anecdotal evidence is anything to go by) do not give valuations. Most sellers are surrpised to get anything more than the usual take a few photos two lines of words and “How much are you asking” a ten minute job. Did any of the agents sit down with your daughter and explain what the market is doing? Who is buying, what sort of money they have, where they are coming from and what they are looking for. Do any of them demonstrate this with actual clients looking for property, with details of recent property sales in a similar price bracket and similar type of property.
I find most sellers when you give them a bit of realism will consider what has been said. Hopefully they may even do their own research and come to their own conclusion.
As for the valuations we give I use a formula which was advised by a valuation architect who does it for a living – as to how to arrive at a valuation. It is not in anyway exact, because valuing a proeprty is a subjective matter and for sure two people will give slightly different valuations but it gives a rough idea of a value.
Whether the client agrees to this valuation or not is their perogative – I dont pressure people into doing what they dont want to do. THey dont have to accept what I tell them. They are free to go out and see for themselves what the market is doing. I even offer them (if they want) advice on how to sell their house DIY, so they dont need to use me if they dont want to, but at least they should be aware of what chance their property has of selling.
But if someone tells me their property is on the market for 6 months and no visitors there must be a reason for it. Generally – but not always – it is because it is overpriced.
If people are coming to see it and still no offers then you have to ask why? What is it that makes people come to see a house but not want to buy it. This is what the agent should be relaying back to your daughter so she can do something about it.
Unless of course they just dont bother asking the buyer what they thought.
However some agencies just bring pepole round so it looks like they are doing their job, a pointless excercise in my opinion because they are just wasting everyones time – but nonetheless they do it. I know because it happened to me when I was buying. Shown a property 20 minutes inland when I asked for an apartment 200M from the beach. Why?
Sales are not thin. There are lots of people looking. What is thin is UK clients. However that is the big problem with most UK and foreign owned agents – they concentrate on the UK market. The Spanish are still buying in abundance and still represent easily the highest proportion of buyers in this area (I cant speak for CDS because I dont live there and only visit once every two months or so)
There is also a steady stream of Dutch, Belgian and Nordic clients coming over – not in droves but a trickle. There is also in this area at least – americans coming here because apparently there is a little boat race next year in Valencia that everyone is getting excited about.
The valuations I give dont depend on what the owner is asking – they depend on what I believe a fair market value is – like a UK based agent must do. If the owner wants less than the valuation I will still tell themwhat I vbelieve is a fair value. If they still want to reduce the price then fine – their choice.
It is not only our interests to sell a property – it is also the sellers.
I hope your daughter sells her property soon – if you PM me I will even give you pointers as to where she can advertise free on sites which bring results and if she doesnt speak Spanish I will even write the advert for her.
Regards
Vince
-
Hi again – sorry took so long with the last psot didnt see a debate going on afterwards. I dont think I mentioned sellers being greedy – the word I used was unrealistic. I am not saying sellers are specifically greedy – nor even in the case mentoned by Jim are they necessarily greedy – they are just influenced by getting more than they expected. It is natural – but it is our role as agents to bring them back down to reality. IMHO
-
Well Vibtudor, thanks for the offers of help. Do however come from an anglo-spanish family and we are as you would expect fairly fluent with the language. There actually haven’t been many viewers, the spanish are mostly totally out of the market at this price range, the “nordic” contingent I know are all trying to sell-up and the dutch, oh and many Germans too.
I can’t speak for your area and I don’t think you can offer any advice on the CDS. We have had property here for over 20 years and I have lived here permanantly for the last 11. I may never have worked as an agent (thank god) and never will but I do know a bit about the market here.
I do agree that many are overpriced but I think the agents should also take some of the blame for this by going along with it. Suppose there may be some excuse seeing as some of them have only left the UK a few months ago. 🙄
If you think that a non-resident seller has a 5% retention, 5% (at least) to pay an agent (+IVA) and maybe more in capital gains if they cannot avoid it, 1% for lawyer, there has to be a considerable mark-up or they would have a net loss.Beginning to wish I had not started this thread in the first place, don’t you have any agents forums to go to 🙂
-
Wearing two hats, we are both owners trying to sell property we own and estate agents, working on behalf of our clients. The market at present is over burdened with owners who bought, probably off plan, around 3 years ago and are now trying to capitalize their investment. As with all high risk activities (stock market, futures etc. ) investment in property abroad is a form of gambling.
Almost daily we see clients who cannot any longer afford the properties they bought and want to sell but do not want to lose money. No-one does. However sometimes with an investment you have to take a hit. When we bought investment property there were never any guarantees that we would make money and at the current rate of progress we will lose money on the sale of one property. We have softened the blow by renting it out and this has been a happy experience. Good tenants and the mortgage and the community charges have been covered.
What needs to happen is a considerable amount of realism in the market. Buyers who need to be flexible and estate agents who give good value for money. I concur with recent postings that suggest that the amount a real estate agents charge will not greatly affect the eventual sale price. Typically we charge 3-4% and have done so since our inception, several years ago. Our clients buy through us because we are specialists, not generalists. Professionalism is what is needed to sell property. Fees charged are of secondary importance.
I would suggest that owners trying to sell look very closely at the agents that they choose to handle their property and not be dazzled by glitz and hype. How helpful are the staff on first contact and will you feel confident leaving your property in their hands.
Once owners, sellers and estate agents all begin to work in a responsible manner, confidence will return to the market and discussions about who charges what will be a dead duck! -
Hi Katy
I would not offer advice in the Costa Del Sol because I know it as well as I know the Southern tip of Outer Mongolia – although I have been to CDS a few times. (however in saying that someone was asking abut off plan in Mijas today and I do know a little about the area but that was more generic than specific)
I agree with your comments (I think this is the first time we have been in accord) tha agents must bear some of the responsibility – they should because they either arent strong enough to tell the client what their proeprty is worth, dont know what their proeprty is worth or just dont care. So yes you are right and I think the tone of my last response was along these lines anyway.
I also agree that in order to make a profit out of a property sale you have to see at least a 20-25% increase in value. But therein lies another problem. There isa saying “Never bet on a rising property market” and that is a situation that many now find themselves in – they bought ina rising market at over the odds (myself included). It is therefore natural that they want to recoup their money and of possible make some kind of profit. But the fact they bought too high gives them limited options – they either have to sell at a lower price and accept a loss, take the property off the market until the market catches up or rent the property out until such time as themarket catches up (the last option has its own dangers)
And this is what we as agents should be adviising clients. So yes we do have a responsibility to our sellers to give them advice – but not everyone wants to hear it – and that is their choice. So we then have the choice – do we list the property knowing it isnt going to sell – or do we walk away. Personally I will walk away, hopefully without bad feeling, but at least the seller has received some indication of what themarket is doing and can think about their options, rather thanbeing led down the garden path that the garden is rosy and yes of course we can sell it for that price.
As for having an agents forum to go to – not yet – apparently that is a subject for another thread, so perhaps we will see one someday. lol
One point I do disagree with though is that the Spanish dont have money – maybe the locals dont but people from Madrid certainly do. At present they are looking for 3 types of proeprty (and I can only speak for here)
1. Apartments by the beach upto 250K
2. VIllas on golf courses upto about 450K
3. Luxury villas upto 1MYou just have to place your property in front of the right people – so why not try and get an estate agent in Madrid to list your daughters property – you never know they may just sell it for you.
Also not knowing what type of property it is I dont know who would typically go for it, but make sure the house is aimed at the market you are trying to attract – ie if it is a young family who would buy it then make sure one of the bedrooms looks like a childs room, if it is a working person or business person – convert one the rooms into an office, if it is a family make sure there is a dining area etc etc.
Perhaps you have done all this (or perhaps you think it’s a waste of time) but these are little triggers which influence buyers when they first view – they get a feeling about a place.
My offer still stands though – there are dozens of free to list websites that do bring results. It only takes ten minutes to put your property on and if only one person enquires and buys it then it has been ten minutes well spent.
Regards
Vince
-
@katy wrote:
Because the sales are thin just now it is in an agents interest to try to persuade vendors to reduce. Not all of them ask inflated prices, when my daughter put hers on the market we both did extensive research on the web. She refused to give the price to any of the agents who came round so she could obtain an independent valuation (except one who refused to give a price!!). She finally asked 25000 below the average valuations and is prepared to negotiate a small further reduction. Greedy vendors….
Dijo la sartén a la caldera (Pot calling kettle….)It’s not about “reducing” the asking price. It’s about putting the property for sale for the correct price. I’ve valued a property for 350k € over everyone else’s valuation (and they asked just about every agent on the coast for a valuation) and sold it within two months for very close to the asking price. Generally speaking though, people do tend to put too high a price on their own property.
As we know, sellers always think their own properties are worth millions yet when they are buyers they think every property they see is worth peanuts. And that goes for everything, not just property. It’s human nature. However the best quote I’ve ever heard was when I asked someone who wanted a lot higher than the market value for their property how they got to that price he was honest and just said “it’s what I’d like to get, no research, nothing.”
Regarding the second part of the quote, with all due respect, whereas you can do a lot of research on the internet to get a price for your property, what you are doing is looking at what Mr and Mrs Smith and Mr and Mrs Reese-Bones put their property up for sale for. My guess is they didn’t do any research. So by putting your price compared to theirs you are doing the wrong kind of research. Estate agents have access to the most important information which you don’t.
To keep it simple:
Your Research:
What is currently for sale on the market (ie what hasn’t sold)Prof. Research:
What is currently for sale on the market (ie what hasn’t sold)
How long that property hasn’t sold for
What has sold, how long it took to sell
What was for sale for a long time but was withdrawn because it didn’t sellThat’s the simplest version of all basic valuations that a monkey working in RE on the coast can put together. Still won’t give you the right price but will get you closer. Problem is 99% don’t even do that or don’t want to do that because they have quotas to meet or they lose their income.
-
More or less agree with what you are saying but how does one find a professional to give a valuation? and how do I know that the person isn’t coming in with a purposely low valuation to make a quick sale in a dying market? I don’t know how bad the market is but I do know one guy who worked for 4 months for a big agent and never sold a property, he could have been at fault but he had the right temperment for the job.
Its easier to find a price if there are blocks of similar apartments but not so easy if its a one-off. Taking the info from house price inflation rises for the last 5 years everything around here should be worth approx 300,000 euros more than being asked, its clear they aren’t.
-
