Why are Estate Agents fees so high?

joseph


Joined: 17/04/2008
Posts: 709

Message Posted:
20/02/2009 02:34

This is a serious question and I would really like that question answered by those "in the trade". From the little I know Estate Agent fees seem to be set at around a 5-6% markup?



So £100,000 paid for a property sees the estate agent take £6000 ?

And the E/Agent gets his money up front from the buyers first major payment, no waiting around for these guys for the property to be finished?



Are these Agents milking the buyers?

How do these high charges compare with UK?

How many Estate Agents say 10 years ago, how many now?

Shouldn't they be paid on completion?

Are buyers voting with their feet and dealing direct with builder?

Can buyers legally deal direct with builder under current laws?



Regards Joseph

negativenick


Joined: 10/11/2008
Posts: 6023

Message Posted:
20/02/2009 06:10

because they are greedy ***tards.....



They cleverly all charge the same fees, so there are no cheap alternatives.



In the UK, the agents all have professional indemnity insurance, pay high street rentals, a decent wage to their staff and still manage to charge around 1%....



My advice to anyone looking to buy is deal direct with the seller/developer and save yourself a chunk





Nick

dixie normus


Joined: 22/02/2008
Posts: 820

Message Posted:
20/02/2009 09:13

Well said Nick, seems a habitual thing for brits to go via the shark pool, unlike the Uk where the magority of Agents are honest, here the magority are crooks and not worth a fig. Good job sites like 44 have warned unsuspecting buyers who to stay away from. So yes we are being stuffed, I would deal with the developer, via an honest & independant brief if you can find one.

Its up to the buyer to deal with who you want, dont listen to the bull that only estate agents can sell houses, most of them dont abide by the estate agents law so why should you.



D.N

No1Doyen


Joined: 04/07/2008
Posts: 16617

Message Posted:
20/02/2009 09:24

I think you'll find they don't all charge between 5-6%.



I think Ian Smith's are charging 3%.

Hippo


Joined: 02/02/2007
Posts: 2070

Message Posted:
20/02/2009 09:28

They are just greedy simple answer

negativenick


Joined: 10/11/2008
Posts: 6023

Message Posted:
20/02/2009 09:37

in yer deams Doyen - for multi agency you find most are 6-7%



in real terms that's 10 grand on a £150k house PLUS 16% vat....



How selling a house can add up to a 10 grand fee beats me.....



You have been warned...





Nick

deecyprus4


Joined: 27/07/2008
Posts: 3452

Message Posted:
20/02/2009 09:38

Estate agents everywhere are bandits, they do little and earn loads..avoid them like the plague.

DONTY


Joined: 07/06/2007
Posts: 534

Message Posted:
20/02/2009 12:40

average UK commission = 1.75%



average TRNC commission = 5 or 6%



average sale price in UK = @£250k



average sale price in TRNC = @£80k



Comms earned in UK = £4375



Comms earned in TRNC = £4400 (@ 5.5%)



TRNC govt takes @ 40% of gross commission in tax



Commission shared with UK agent if punter comes by this route.



Car, Phone and electric costs higher in TRNC



Uk agent sits at desk, waits for door to open, sends punter to mrs Miggins house and hopes for deal



TRNC waits for door to open, takes punter 100km, buys lunch and hopes for punter doesn't try to go direct.



The cost to find each customer is higher here due to SEO costs (Internet marketing very competitive here), Intl marketing etc.



deecyprus

Without agents how do punters find the developments?



In the UK 50% of agents time is spent chasing lazy bas*%rd lawyers and keeping the chain alive.



If we don't need middlemen why have Tescos? lets all go to the Heinz factory to buy our beans!

DONTY


Joined: 07/06/2007
Posts: 534

Message Posted:
20/02/2009 12:56

Hi Joseph



The agents job is connect buyer to seller.



Once this is done they get paid. They have nothing to do with the build, the quality etc etc so they get paid when the deal is done.



Property often takes 2 to 3 years to complete so if the agent had to wait 3 years to get paid they would be out of pocket for advertising, rent, wages etc etc etc.



It is not realistic for any business to wait 3 years to get paid after completing their job.



You can go direct to most Builders/Developers. they should be registered as an agent (stupid idea imo) but if not most have an agreement with a friendly agent who will take a commission for the service (from the builder).



The whole registered agent malarky is basically there so the govt can get their tax (fair enough) and restrict who is in the business (not so fair as its who you know, not what you know here).

No1Doyen


Joined: 04/07/2008
Posts: 16617

Message Posted:
20/02/2009 12:58

Nick. I meant for a single agency.

deecyprus4


Joined: 27/07/2008
Posts: 3452

Message Posted:
20/02/2009 13:51

Donty, estate agent worldwide are all the same...they do hardly anything, nothing that one cant do oneself.

negativenick


Joined: 10/11/2008
Posts: 6023

Message Posted:
20/02/2009 14:04

Donty - I wasn't born yesterday....



UK agent's rent will be far higher, salaries to staff would be higher (typical TRNC agent will be paying staff commission only, and many won't bother getting staff a work permit) - PLUS UK agents are required to have professional indemnity insurance, TRNC agents do not have professional indemnity cover....



All for around 1%.....



The fee in the TRNC should be the same or LESS....



6-7% is daylight robery.





Nick

DONTY


Joined: 07/06/2007
Posts: 534

Message Posted:
20/02/2009 14:15

Oh Dee!



you have the option of doing it yourself.



Go build a website, place adverts (middleman of sorts), go to exhibitions (middlemen) etc let us know how u get on and how much you spend to make the sale! If its so easy why doesn't everybody do it for themselves?



The business world goes round cos of middlemen. If u want a joint of beef do you go to the farm? If you want a paper do you visit the printing house? Why pay a middleman just to put this stuff in his shop? Its so you can find it easily.



Its called Sales and Marketing and its been going on since time began.



If a builder want to sell in-house he needs to employ a presentable individual to sell his stuff and this person takes a wage and commission so you cant get away from middlemen however hard you try.



I was in agency in the UK and the poor sods are the ones keeping the whole deal running as the lawyers do sod all! Without them its murder.



You may not understand sales but do some reading, it may help!

deecyprus4


Joined: 27/07/2008
Posts: 3452

Message Posted:
20/02/2009 14:17

I have done it myself twice and I used to be an estate agent, so there is no advice you can give me Donty

deecyprus4


Joined: 27/07/2008
Posts: 3452

Message Posted:
20/02/2009 14:19

I worked for Taylors and before that Corbetts whom Taylors bought out. They are bandits and do bugger all except place an advert..please dont teach a grandmother to suck eggs.

DONTY


Joined: 07/06/2007
Posts: 534

Message Posted:
20/02/2009 14:23

negnick



if its that easy why dont you do it?



Agent employees in UK get paid peanuts unless they are s*it hot.. look on totaljobs.com



up until the credit crunch employees got basic, car, phone and comms.

these days working sans permit is not an option.



the govt here fleece all businesses (unless u r connected)



Advertising spend per sale closed is much much more than a high st agency in uk.



In the UK the punters are looking, here you need to create a market.



I'm not saying a good agent can't make good bucks but its not as simple as you make out otherwise why aren't you a millionaire agent?



Any agents reading this do you agree?

DONTY


Joined: 07/06/2007
Posts: 534

Message Posted:
20/02/2009 14:28

who the hell is Corbetts and Taylors? should i be impressed?



did you do professional sales training or were u just one of those untrained muppetts?



how long were you there? what did you do? Did u do the books? how many did you sell on average every year (were you any good?)



back 5 yrs ago, having an agency was a licence to print money as is any company who gets into a growing market with little competition but its a whole new ballgame now gran!

DONTY


Joined: 07/06/2007
Posts: 534

Message Posted:
20/02/2009 14:30

Dee!



how do you recommend sellers get buyers for their property then?

cronos


Joined: 26/10/2008
Posts: 2093

Message Posted:
20/02/2009 14:32

DONTY....by your own admission Estate agents are just an introductory service between buyer and seller.

They are a shop window for vendors to advertise their wares.

There is no duty of care to the purchaser whatsoever.

So when it dawns on people that the £150K villa they bought as a result of you driving them around for a morning,and "treating" them to lunch,would actually have only cost £140K without your valuable input,can you understand why they think they may have been short-changed?

dickyboy


Joined: 31/12/2008
Posts: 129

Message Posted:
20/02/2009 14:43

We had our house on the market last year, everything in place , fully furnished, deeds etc , and not a sniff with two estate agents.



We were aware the market was slow but we felt that our house was a good buy. We went to another bigger Estate Agent and they recon that they will sell the house within a month if i am prepared to bung the salesman/woman £2000 in cash, no joke on top of the 5%. (no questions asked) that how to sell a house, i tol them to get stuffed.

deecyprus4


Joined: 27/07/2008
Posts: 3452

Message Posted:
20/02/2009 14:48

Donty, have I been rude to you...NO so kindly afford me the same respect.



Corbetts were estate agents back in the 80's just a small outfit and they were bought out by Taylors..Taylors are probably the largest estate agents in England, can't believe you havent heard of them, however if you say you havent ok, maybe you are not English.



Almost all negotiators are untrained 'muppets' lol...I started at the bottom and worked my way up with Corbetts...I left 3 weeks after Taylors took over.

tlvccom


Joined: 29/09/2008
Posts: 327

Message Posted:
20/02/2009 14:53

Agents are an introductory service, but how do we get that customer in the first place?

By spending large sums of money abroad advertising, in papers , magazines and on the internet property sites as well as our own. it is not a cheap to run a company in the TRNC, THE GOVERNMENT HAVE SET THE COMMISSION RATES, sole agency 3%plus kdv, 5% plus kdv multi agent, we have to pay the relevant taxes/kdv at the rates they set, do you want the agents to break the law?

UK agents do only charge 1% but on multi sales, my friends agency in the good times was selling 10/15 houses a week, in the TRNC second homes are a luxury, but i would love that kind of volume.

Its easy to sit on the outside looking in, but ask any company owner here in the TRNC, NOT JUST AGENTS, to find out how expensive it is.

MrAngry


Joined: 17/11/2008
Posts: 47

Message Posted:
20/02/2009 16:36

I think the answer to the question is to fund the greedy directors not the poor old sales staff. I know many estate agents in the TRNC and boy do they get tucked up by the bosses. If they are willing to screw the people who work and earn the money for them. Think what they will do to you!!!!!! After all you are just a desperate Brit trying to sell your house.



Maybe we should all start boycotting the esetate agents and doing it online. If they have no properties to show, customers would soon start shopping online.

Kitty Kat Jac


Joined: 18/03/2008
Posts: 230

Message Posted:
20/02/2009 16:46

Donty



I am an agent here (with a work permit I may add Negative Nick) and I was an agent in the UK (Reeds Rains) and I know what you are saying is 100% true. But I am afraid you are wasting you breath, nobody on this site will listen to your, mine or anybody else’s point of view. They all think their point of view is the right point of view, they dont care how much it costs on advertising, staff, cars etc because that doesn’t fit into their argument.



What makes me laugh is when they all complain about the depreciating value of their homes when all they can do is be negative. Maybe if you were a little bit more positive the percentage wouldn’t be the issue because your property would be worth more money.



I sell houses, because I still believe in the TRNC, maybe you would start selling yours if you started to feel the same.

joseph


Joined: 17/04/2008
Posts: 709

Message Posted:
20/02/2009 17:00

You read thru all the treads re Estate Agents and soon realise that this is a real bees nest. Seems to me quite a few are happy with their E/A but the majority feel they received a poor service which only makes them begrudge the amunt of monies paid for their villa/apartment.



Donty makes a good point about being first in... which brings me to my next suggestion. Donty if you or others on this board are in the trade why not approach Cyprus 44 to advertise on this forum. Cyprus44 could negotiate terms for advertising and in return offer a rate say of 3% for an assurance of due diligence to client. This then could be another first for our forum.



We all know Cyprus44's growing reputation is becoming an early port of call for many first time buyers and finding an E/A recommended on this site would carry some weight in the market. Cyprus44 would I hope hammer out an excellent deal for said perspective buyers and in return the E/A would guarantee due care. Thoughts?



Regards Joseph

tlvccom


Joined: 29/09/2008
Posts: 327

Message Posted:
20/02/2009 17:01

Mr Angry

you seem to be accusing agents of "screwing buyers and seller"

HOW?

Again the rates are government set, not set by agents.

I know sales staff bonuses are offered by developers and builders, this has been the way for the 8 yrs ive been in the business, i have not heared of agents asking private buyer for the same, well not me anyway, i certainly let my staff have the bonus they have been offered.

Why are you attacking companies for making a living? give it a go yourself and see how hard it is, and how much it costs! if you have had a bad experience at the hands of an agent, im sorry, but most of us are very honest and hard working, we do a very good job for our vendors and buyers alike.

deecyprus4


Joined: 27/07/2008
Posts: 3452

Message Posted:
20/02/2009 17:07

Kitty 12-15 years ago when houses in the UK were not sky high your rates were the same, so how can you justify what you were charging say 1 year ago when prices had boomed..you rip the public off and do very little, my house sold in 1 day yet I had to pay 2% of £410.000...as I said a rip off, it wasnt even advertised.

tlvccom


Joined: 29/09/2008
Posts: 327

Message Posted:
20/02/2009 17:20

Hi Dee

lucky agent, but if you had not given that agent your house, you would not have had that buyer!

when i sold my UK house i offered the agent 2% to sell within 2 weeks, it sold in 3 days, i still made a handsome profit from a 5 year old house and was a very happy bunny.

But i say again the rates are set by the TRNC Government.

no agent here kicks up a fuss if vendors try to sell their villas without an agent, it only limits exsposure to this market (even by word of TRNC Law you should use an agent) silly one i know.

joseph


Joined: 17/04/2008
Posts: 709

Message Posted:
20/02/2009 17:43

Again I ask...why not an Estate Agent making an approach Cyprus 44 to advertise on this forum. Cyprus44 could negotiate terms for advertising and in return the Estate Agent could offer a rate say of 3% for an assurance of due diligence to client. This then could be another first for our forum.



We all know Cyprus44's growing reputation is becoming an early port of call for many first time buyers and finding an E/A recommended on this site would carry some weight in the market. Cyprus44 would I hope hammer out an excellent deal for said perspective buyers and in return the E/A would guarantee due care.



Thoughts?



Joseph

ROBnJO


Joined: 30/06/2008
Posts: 1289

Message Posted:
20/02/2009 17:45

Let's have a bit of sympathy for EA's!



If they sell your house in 24 hrs, they get moaned at for doing nothing for their fees!



If they have advertised it for 12 months, taken dozens of picky punters with their snotty kids round it in their cars, maybe even wined & dined them at their own cost, and still can't sell it, they get moaned at!



If they don't sell it, they don't charge!



How many of you would be prepared to pay the costs of advertising, viewings and a %age of overheads until the agent sells it?



Or if you're a buyer, would you pay a fee for the services you get from the agent?





Lawyers, however, will charge for everything they do, be it sucessful or not!



When did your Lawyer last collect and drive you anywhere? Or treat you to lunch without putting it on 'your' bill?

tlvccom


Joined: 29/09/2008
Posts: 327

Message Posted:
20/02/2009 17:53

Joseph



in simple terms, uk agents (we use several across the uk and europe)

find it easier to send a buyer to 1 point of contact, who will collect them from the their hotel show them several properties that meet with their criteria (maybe buy them a sarnie) and return them to the comfort of the hotel.

then once a buyer proceeds will do all the required leg work to solicitors etc, while they sit back and invoice us for HALF the commission anyway.

I hope this answeres your question!!!!

barnaclebill


Joined: 12/12/2008
Posts: 303

Message Posted:
20/02/2009 18:01

Joesph, Not all estate agents charge 5-6% on sales I no of an a estate agent that only charges 3% on the other hand I no one that charges 10%.The Goverment set the minimum fee to 3% not the estate agents.For those of you that think its easy try it.Costs initially for setting up are $100000 ,Buisness Permit 10000ytl, each work permit 700 euro, followed by wages, rental of office, advertising, KDV of 16% on each sale, accoutants fees etc etc. In todays market you would be extremley lucky to be selling more than 2-3 properties a month,this is why estate agents are probally putting their fees up to cover costs. If you go to an estate agent and he is charging 5-6-7% go somewhere else the chances are that another agent will do it for less. Most of the negative attitude on here against estate agents are probally by those who have had a raw deal.(I include myself in this catergory) but I dont go around tarring every one with the same brush.Please Please shop around ,do your homework Good Luck

No1Doyen


Joined: 04/07/2008
Posts: 16617

Message Posted:
20/02/2009 18:07

Ian Smith charge 3% for sole agency.

barnaclebill


Joined: 12/12/2008
Posts: 303

Message Posted:
20/02/2009 18:16

Msg 29

Joesph In my opinion this would leave Cyprus 44 wide open to loads of flack and slangging matches,could you imagine if only one deal went wrong through an agent reccomended on Cyprus 44 site.On another note anyone can post on this board ,fake testomonials,fake bad expierences etc .How would you police it. Try asking an E/A for the telephone number of a satisfied customer,once again its not infalable.

joseph


Joined: 17/04/2008
Posts: 709

Message Posted:
20/02/2009 18:23

Good points Barnacle, this is why I asked for members thoughts, thanks.



One point that hits home really hard is the fake ids that could be registered... especially when you see how many people, for reasons good and bad, are registered on our forum anonymously



Regards Joseph

deecyprus4


Joined: 27/07/2008
Posts: 3452

Message Posted:
20/02/2009 20:00

tlvccom, yes I would as ppl were knocking the door at that time..I didnt need an agent, but hey there you go.

tlvccom


Joined: 29/09/2008
Posts: 327

Message Posted:
21/02/2009 10:04

Dee, if you did not need an agent why did you contract them to sell you home at 2%, would you have been happier if it took them a year to sell it?

You were happy to pay the fee when you contracted them, i presume you were happy it sold within 24hrs?

you tell us you were an agent, what would you have done, told the vendor

"oh sorry we sold it too quick, we wont charge you" PROBABLY NOT!!!



And No1Doyon nearly all agents charge 3% sole agent.

DONTY


Joined: 07/06/2007
Posts: 534

Message Posted:
21/02/2009 11:06

Dee



come on love, get real



You employ someone to sell your house at an agreed price, they sell it within a week which is great and then you moan? Unbelievable! Would you be happier if it took a few months? If they had the client and matched them to your property in that time, Bravo them!



I lived in the UK for 20 yrs, and did a fair stint in agency and can tell you that where i'm from (west of London) there are no Taylors estate agents. Britain is a big(ish) place, perhaps you didn't realise?



Everybody



If you think you don't need an agent to sell your house, go ahead and do it yourself. No one forces you to use an agent (you can legally sell your own home). The only reason you do is that they are the people who buyers go to when they want to look at a selection of property.



Can't wait to see all those home made boards outside homes. I also wonder how much money you will spend getting an ad in a UK daily paper!

Stewart


Joined: 19/07/2008
Posts: 1107

Message Posted:
21/02/2009 11:09

Hi Try using Halil, situated in the Partners abroad office just down the road that leads to the Merit hotel...he will not charge you 5%.....more like 2 / 3 %

DONTY


Joined: 07/06/2007
Posts: 534

Message Posted:
21/02/2009 11:28

Stewart



Halil is a good egg for sure but lets do an experiment, its sell your own time. Everyone have a go see how you get on and report back.



I'm off to Lefkosia to pick up the Cyprus Today from the factory, then down to the farm for some meat, then to the bakery factory, then off to the refinery to get some petrol etc. see you in a few weeks!

tlvccom


Joined: 29/09/2008
Posts: 327

Message Posted:
21/02/2009 12:40

Have just spoken to my Friend Halil, and the owner of his agency in the UK

3% SOLE 5% MULTI.

MMMMMMMMM!!!!!!!!

Kitty Kat Jac


Joined: 18/03/2008
Posts: 230

Message Posted:
21/02/2009 14:58

Deecyprus -



I am confused, let me get this right, you bought a house through and agent, you made a profit and sold it one day through an agent and you are complaining??



Seriously? What can we do to make some people happy?

merlia


Joined: 20/02/2009
Posts: 1

Message Posted:
22/02/2009 17:52

Looks great! A lot of great thoughts!

kaiserphil


Joined: 14/12/2008
Posts: 1096

Message Posted:
22/02/2009 18:27

tlvccom - just spotted this from you further up "THE GOVERNMENT HAVE SET THE COMMISSION RATES". When I sold my house I spoke to a number of agents (most of whom wanted 6%, not 5). When I expressed my surprise at what they charged, not one of them said the obvious "Not our fault, that is set by the government".

You will forgive me if I view your statement with some doubt?

Ailletoo


Joined: 24/01/2009
Posts: 1003

Message Posted:
23/02/2009 12:54

Does anyone have a contact number for Halil?



Thanks

DONTY


Joined: 07/06/2007
Posts: 534

Message Posted:
23/02/2009 13:47

Halil 0533 846 6080

crystalagent


Joined: 03/09/2007
Posts: 39

Message Posted:
23/02/2009 14:59

Dear Friends,

After read your fantastic compliments(!) about agents, I feel in need to make a note for those who think that our charges are so high.

First of all, as you may all now, we ( I mean all registered and trustful agents) are not charging any fees to the buyers. We get our commissions from the sellers who are probably the developers. The shares we get is determined by the developers. Some are offering %5, some are offering 10%.(I am ready to prove it with signed contracts). So please bare in mind that we are not greedy and asking a lot of commission but the developoers are offering us high percentages to make sellable their properties.

Some friends gave statistics from other countires. Im sure its true. But even today I got a mail from Dubai who is offering me 15% if I sell their properties.

I know some of you had bad experiences in the past with the developers or with the agents. But please, we are not all same..

tlvccom


Joined: 29/09/2008
Posts: 327

Message Posted:
23/02/2009 17:06

Kaiserphil

i dont care if you doubt it, phone a solicitor and ask for your self.

The law is there for all to check, so check b4 you accuse!!!!!

kaiserphil


Joined: 14/12/2008
Posts: 1096

Message Posted:
23/02/2009 17:43

tlvccom - not accusing, just doubtful. Surely the first thing any one of those agents wwould have done would have been to blame the government!

What law?

sparta


Joined: 24/10/2008
Posts: 226

Message Posted:
23/02/2009 17:45

kaiserphil,

it is law check it out!!

BillyB


Joined: 19/05/2008
Posts: 436

Message Posted:
23/02/2009 20:58

"THE GOVERNMENT HAVE SET THE COMMISSION RATES"

Call me cynical but could it be that Hasan Sungur the head of the estate agents union tells the government how high he wants the rates. Hasan Sungur owns vast amounts of land and property in the TRNC so hardly independant.

kaiserphil


Joined: 14/12/2008
Posts: 1096

Message Posted:
24/02/2009 14:12

Wasn't going to add to this, but comments above deserve a response.

I have spoken to a well-known estate agency (no, it doesn't matter who, but they are British-run) and they tell me that the rates are not set by anyone other than the estate agents, who all tend to charge around the same, currently 3% sole and 5% multiple.

My last word on the subject!

sparta


Joined: 24/10/2008
Posts: 226

Message Posted:
24/02/2009 16:38

Kaiserphil,



and that particular agents word is correct??? when you wrote this below...ANY ONE OF THOSE AGENTS but not the one you know.. HA Ha



not accusing, just doubtful. Surely the first thing any one of those agents wwould have done would have been to blame the government!



What law?