Exorbitant yearly letting fee from property agents

[aussienam]

I am comparing apples with oranges here so don't shoot me down.  But here in Thailand as a condo owner using a property agent to source tenants for you - I have found that upfront they want the first month's rent for a year contract.  

I have no problem of course in the agent getting their commission.  They do advertise online, some use media, others call prospective tenants, drive clients around to view condos, have running costs etc etc.  Part and parcel of doing business.  Up to them how much or little they want to spend. 

 

But there is where the buck stops.  Post commission the year then runs on with no further input from the agent other than when the year's lease is up and is due for renewal.  Whereas I have had to deal with ongoing issues with the condo. 

 

A clause in the letting agreement reveals the agent has the monopoly to come and collect another month's rent if the lease is renewed.  The tenant wants to stay on.  All the property agent needs to do is turn up in his car, hand over the new lease to be signed, take his money and leave for another year.  Talk about easy money!!!!!  No wonder they are rolling in money here.  And legal action threatened if any attempt to terminate the lease and renew it without the property agent.  Talk of lawyers quickly were mentioned.  

 

Now comparing oranges - Back in Australia where overheads are much higher and property agents do much the same thing sourcing tenants, firstly there is no upfront month's rent taken.  There is a week 'letting' fee taken, plus a percentage that for all intents and purposes equates to about the same as a month's worth of rent - same as here in Thailand.  BUT, and this is the big BUT, they then properly manage the property for you.  They collect the rent, they inspect the property, they arrange maintenance and any queries or problems raised by the tenant.  It is all in their hands.  

 

Anyone know much about Thai Property law here and the true legality of this?  Would be interested to know.  Thanks.  

 

[BEVUP]

They also charge the Tenant a months rent for finding the property for them

 

 

[johng]

Seems simple to me....dont use a "property agent" advertise and find tenants yourself.. you have maybe a better chance of getting "good" tenants if you "vet" them yourself..you already do the maintenance part "agents" are redundant.

[JAS21]

Rent the condo to someone else and let then sub-let to 'whoever" .... as said why use and agent ...

[KittenKong]

A clause in the letting agreement reveals the agent has the monopoly to come and collect another month's rent if the lease is renewed. The tenant wants to stay on. All the property agent needs to do is turn up in his car, hand over the new lease to be signed, take his money and leave for another year. Talk about easy money!!!!! No wonder they are rolling in money here. And legal action threatened if any attempt to terminate the lease and renew it without the property agent. Talk of lawyers quickly were mentioned.

I agree that estate agencies here are hugely overpaid for doing very little.

But the clause you mention is entirely optional: why not just cross it out before signing? Whilst you are at it, why not change the wording so that you only pay their commission when the tenant has completed his lease and has paid for everything including any damage? Seems reasonable to me. Any agency that wont agree to either change is clearly an agency that you dont want to deal with, so just move on until you find one that will agree.

As for getting property management as well as a tenant-finding service, as far as I'm aware agencies will do this here, but they will surely want to charge you more than the 8% they want charge you for just finding a tenant. The same applies in other countries as far as I know. I seem to remember paying 17.5% to an agency many years ago in the UK for finding tenants, collecting rents and managing my property. They did a satisfactory job and I got good value from their fee, especially as I was in another country and it was before the internet and email existed, so doing things oneself at a distance was nearly impossible.

Again, all these figures are negotiable, so negotiate!

[KittenKong]

Anyone know much about Thai Property law here and the true legality of this?

Estate agencies here are not monitored or controlled or legislated about any more than any other business is, which is to say very little. That's why so many dodgy ones pop up every month, only to collapse a few months or years later.

Compare this with other countries where agents are licenced, and have to undergo training, and have their backgrounds checked, and where any money they handle is ring-fenced, and where the law requires them not to lie and to tell the full truth. Having done that comparison you quickly realise what a complete joke estate agency is here.

As for agency fees here, they are entirely negotiable.