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Saturday, January 20, 2007
jogary
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Can anyone tell me at what stage in the buying process does the agent gets his commission? Is it at the time you pay your usual 3000 Euro deposit, or at the time of completion?
If it is paid early on, what happens if you don't complete?
Are all agents recognised by developers in that anyone could call themself an agent and claim commission if they introduce a buyer?
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20 Jan 2007 4:06 PM
Juan Pánzon
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Hello there,
Normally, the agent receives the commission when the private purchase contract is received..... that if all goes well because some developers are very slow to pay.. This is essential as no State Agent could keep their business ongoing having to await 2 to 3 years to collect...
If you do not complete, normally the developer would have to make a decission and that is normally based on what the excuse for not completing is..... but the sales comission can not be returned as it was the "payment" for the job made by the agent on selling the house.
In a slow market as today, it would be difficcult but before, in the middle of the "fever" it was more common as there was waiting list for apartments.... and the developer would sell it again soon.
Cheers,
Juan.
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21 Jan 2007 7:19 PM
Smiley
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Would you not agree though Juan that 15 to 20% commissions for selling off plan when the client pays deposits at contract stage are perhaps a little excessive. Perhaps if some of the commission was held back until such time as the estate agent had done the job they promised the client they would do - as in sell on their off plan investment for them - then more of the "hard sellers" would have worked harder to sell on the client investment rather than just concentrate on selling off plan developer product for the large majority of the time.
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21 Jan 2007 7:56 PM
Juan Pánzon
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Hello Smiley,
I completelly agree that 15 to 20% is enourmously high and I would really like to know which developer pays so..... the summ simply does not add...
The maximum commission ratio I´ve herad off was 10% on complicated to sell new developments in newly develping areas such as it was the case off Majestic when they started in Casares....... as they were some of the first there and we needed to sell high standards apartments in the middle of nowhere...now, that area is quite nice and even the Town Hall is preparing parks and things and Doña Julia is also consolidating.
If any developer is offering 15 to 20% comission I smell a rat in there.... there must be something wrong as the costs and market simply do not allow for this.... there must be license problems or the possibility of this...nowadays you can be happy to get away with 5% to share with another agent.
Actually, if an agent receives an offer of 20% comission I think it would offer a 10 % to 15% discont to their buyers which actually is a rebate in the price of the property without having ( on the side of the developer) to recognize that they dropped the price... thus creating an issue with the past buyers....but this is only an impression... as I think that the developers have not yet drawn very clear "contingency plans" to counter the slowing down of the market....
Cheers,
Juan.
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22 Jan 2007 11:46 PM
Smiley
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Think you will find that during the heady days of the late nineties and early into the millenium 15 to 20% was the norm rather than the exception. I have to admit that I was not here until 2003 but I know there were developers paying agents that level of commission at that time on off plan. Whether that is still the case I could not tell you but I was not specifically talking about the here and now. I was trying to respond to the thread about when the commission was paid and the fact that any refunded deposit is less commission to the agent which has happened a lot recently. People in this position are suddenly discovering what has happened and perhaps some answers why the service levels they might have justifiably expected have not been forthcoming as in "now we have the commission why do we need to worry about the client". I am not making statements about any specific agent and believe me I have some great relationships with agents that in my opinion offer a completely different level of service, care and attention - much like yourself I am sure - Nonetheless there is a common complaint on this forum that once people's deposits are paid they get left in the lurch - the fact that on many occasions 100% of the commission is paid at that time whether it be 5, 10, 15 or 20% my view is that it does not encourage the real estate company to offer continuing service. All right they wont go back there if they buy again and they will tell their friends not to use said company but they have already bought and they are the ones that have suffered. Personally my view would be that it is better to get recommendation business by trying to offer first class service all the way down the line - but its only my view.
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22 Jan 2007 11:50 PM
JeansSis
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This message was last edited by JeansSis on 5/4/2007.
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