Property - Asking Prices

[Bristle Si]

MrsB
I think the attitude of CVO estate agents says it all - if they're not prepared to update and be conjusive to potential buyers' interests, move on from the area - look elsewhere - then maybe the agents and vendors will sit up and take notice and ensure all is updated to the current property climate.

[EMM]

THe cVO agents are no different from agents anywhere else in the Algarve or where the rewards to sales people are based almost exclusively on commission from the sale.
Agents are very reluctant to give buyers information that will enable them to identify a property and then go directly to the developer/owner or other agents.
As we found , visiting a certain local developments sales office we were offered a discount that was not available through the agent ??.

Everything that has been said about the lack of a proactive response from agents is true and those who refuse to change will not survive in the long run.

[shanagarry]

Four years ago at the height of the buying frenzy I was offered the opportunity to buy a controlling stake in a local estate agency. At the time it made good financial sense - but during my due diligence I discovered a web of inefficiency, laziness and ineptitude - all of which I discussed at considerable length with my prospective partner. I also took the opportunity to speak to other agents locally to get a feel for the 'industry'. I am not an estate agent by profession or practice.

Fortunately, for me, none of them gave me the confidence that there was any need to change their approach or their business model - some had a variation but to my way of doing business - it was akin to trying to reinvent the wheel - so I withdrew. Nothing since has changed my mind - if anything it has reinforced my decision.

Estate Agents everywhere appear to lack the common sense and imagination to break the mould and think outside 'the box' baseless valuations being one example - time is running out for them

[MrsB]

I believe it is incumbent on the agent that they advise absent sellers of actions they should be taking to enhance their chances of selling. If you do not see that as an agent's responsibility - you have more money than sense

Advise, yes. Take action - no; that's the responsibility of the vendor/property management company surely. Any vendor not keeping up with maintenance will be punished - either by failing to sell the house or by having to accept a reduced price.

5% commission is far too high; it leads to complacency. A lower commission would keep them on their toes as they would HAVE to sell more properties to survive. What surprises me is that at the moment they seem to prefer 5% of nothing to a lower percentage of something!

[shanagarry]

I believe it is incumbent on the agent that they advise absent sellers of actions they should be taking to enhance their chances of selling

Mrs B - I believe that's what I wrote and is the point I have been making throughout this topic. It is encouraging to see that the majority agree with my opinion - if only the estate agents had the same foresight.

I would go one stage further and suggest that agents should consider the full scale of their responsibility. Are they in the advertising business or are they in the property selling business - there is a considerable difference. The majority, in my opinion are in the advertising business. Those who are in the property selling business could expand the scale of their operations by taking a more proactive stance with sellers and continually advise them of actions needed to enhance their sale chances.

At the risk of offending the property management community - I believe the previous suggestion applies equally to them but as they spend most of their time pushing paper around during the close season that they limit their visits to their client's properties to infrequent (something that links back to a parallel topic on break-ins).

Regretfully too many of these people in the 'Property' industry have had it too good for too long and in my view are not providing a service that is genuinely VALUE FOR MONEY - it's more of the same (the way it has always been) and that has to change. To make that happen - clients must be more demanding and specific with their service requirements and not be reluctant to spell it out

[sunman]

What's the spec. MrsB?

Two beds min, short walk to the town, probably a communal pool, good private outside space. I'd prefer a townhouse or small villa (don't mind a semi if it's private enough)to an apartment, but we're pretty flexible if the location's OK.

Here's an example that my husband has just passed on to me

http://www.rightmove.co.uk/overseas-pro ... 56460.html


hi MrsB, I was driving past where I thought this property was & I found it. It's where we thought it was, on Presa da Moura behind the Island Cafe; the development is about 35-40 townhouses & looks very nice. The grounds are all very nicely laid out and manicured, lots of nice grass areas; the pool area is very attractive & the pool itself is a very decent size & a nice shape.
Parking is in off bay roads on the perimeter so that the development itself is completely pedestrian, which felt nice. The gym is under the pool & looks good, there's a childrens play area with a couple of swings, slides & climbing frames, & an outdoor badminton court.
I looked in a couple of windows, the bedrooms are on pool level & looked nice, both have en-suite bathrooms, I wasn't able to see upstairs to the living areas but they all seem to have nice balconies which you could sit out on.
The views are nice, across a valley, you're close to the sea but I don't think there's a beach there.
The one downside is that you'd need a car for pretty much everything; shopping, beaches, restaurants etc., all of which is close by but not a walk if you get my meaning?

with regards

sunman property viewing services

[shanagarry]

Sunman - not wishing to 'rain on your parade' - I can't see how what you are doing is right on proper on this open forum.

If Mrs B wants to avail herself of your company's services - I suggest you deal with it offline

[sunman]

Sunman - not wishing to 'rain on your parade' - I can't see how what you are doing is right on proper on this open forum.

If Mrs B wants to avail herself of your company's services - I suggest you deal with it offline

I hear what you say Shanagarry,

for info; I'm retired & have been living here 10 years, I have no Company, nor do I represent any company so my opinion is only mine & I hope neutral, my closing line was a bit of a jest.

whether or not this sort of view has any place on here is for others to decide but I don't see how it differs much from say, a restaurant review?

[bruce]

Sunman if I was looking for a property in Cvo I would be most appreciative of your help.

[shanagarry]

Sunman - apologies for jumping to the wrong conclusion - maybe you should start a little sideline - going on a 'recce' for those who want to know where a property is and what it looks like but the agent won't disclose the location. Could be fun and lucrative - but more importantly it would make the agents re-think their 'game-plan'

[EMM]

I am sure we all agree that the 5% rate is higher than it needs to be however the reward structure in the property market is such that sales people can go for long periods ( often months ) without any income if they do not get a sale.
Many if not most are not even paid expenses and certainly do not receive the majority of the commission, that is kept by their employer to " cover overheads etc ".

If we all accept that agents have to reduce their cut then sellers also need to be more realistic.
As has been reported many times the practice of sellers to add their agents cost to the valuation results in unrealistic prices.

If you agent values it at E400k then it is just plain stupid to ask for E420K.

[shanagarry]

EMM - as the majority of contributors to this forum are from the UK (at least I think they are) - they will all be familiar with the 1.5% commission fees demanded by UK agents. When they decide to transact a property sale here - they see that figure jumping to 3+ times the UK amount. They quickly realise the amount of cash that represents and attempt to find a way to defray that cost. When added to the other costs, taxes (CGT) - the diminution of their return pales into 'loose change' (sometimes).

If we all accept that agents have to reduce their cut then sellers also need to be more realistic.

This point is the stage at which we define an agent as either an advertiser or a property seller. If an agent is offering a property for sale at a value s/he knows to be unrealistic - they are mis-representing/misleading their client - and should refuse to take that property on their books. The advertiser will take anything just to fill their window.

As somebody who tried to do that (sell at an unrealistic price) in the UK some years ago and was told to instruct another agent - I ate the 'humble-pie' and while I was annoyed at the time I quickly realised the sanity of the agent's experience and reading of the market. The property sold at the price he valued it at and he was not prepared to put his name to a price that was unrealistic.

I suspect that many agents here are still living in the time-warp that was not that many years ago - and still think the 5%'s are still there. I can't see how their overheads are that great here and neither can I see why they need large workforces. Rents are cheap, salaries are low - compared to the UK - why do they feel they have to charge 3 times more? All the time they demand 5% - we will undoubtedly see unrealistic asking prices - it's time for a reality check

[sunman]

I've never really understood the Property Sales business; back in London I paid 1 1/2% or 1% sales commission so where on earth does this 5% rate come from? is it a cartel or do the regulators set the level?

then, it doesn't seem very entrepeueurial; if my assumptions are correct an agent will receive a fee of €10,000 on the sale of say, a 2 bedroom apartment priced at €200,000 and receive a fee of €50,000 for the sale of a 5 bedroom villa priced at €1,000,000; so how does that work? is it 5 times more complicated? or do they put in 5 times as much work?
if the fees aren't regulated the why not offer a sliding scale? or even a flat fee of €10,000 regardless of sale price?

taking the sale of a €1,000,000 villa;
the buyer pays €1,000,000 + 10% sisa tax = an outlay of €1,100,000
the seller gets €1,000,000 - 5% commission = a net revenue of €950,000
this establishes a black hole of €150,000 or 15% on any transaction

frankly I'm surprised that anyone buys or sells anything at all

[shanagarry]

frankly I'm surprised that anyone buys or sells anything at al

Couldn't have put it better

[MrsB]

frankly I'm surprised that anyone buys or sells anything at al

Couldn't have put it better

Nor me!

There definitely seems to be an opportunity for a proactive agency along the lines you are suggesting.

Charge 2% commission (please the vendors) and refuse to take anything on your books that the vendor wants to put on at an unrealistic price (eliminate the time-wasters). That way, you'd only attract the serious vendors and your agency's asking prices would clearly appear much more attractive to prospective buyers than your competitors. Seems win-win to me