Estate Agents Fees

[Gravelrash]

Sunbelt and Quicksilva,

Good.

Clearly Gravelrash is talking his own book and whilst I have no doubt he/she is genuine and does not enter into this scam, I fail to see how when the worst practices are undertaken as per my posts and evidence, he/she can do anything other than call it what it is and accept that the facts confirm it is ongoing. OR is it possible that either Gravelrash has failed to really fully understand and accept it is widespread (still) or that I have misread Gravelrash and he/she is actually trying to defend this practice via the back door!!!!!!!!!

Agreed, the sooner we get this industry regulated, the better. Gravelrash, I don't hear you calling for regulation for the industry, as a responsible, respectable and aware representative certainly should be in the circumstances? Come on, it's the Wild West in Pattaya, as you yorself say, so let's see you take the Bull by the horns, stand up and be counted. Certainly, the Thai Estate Agent business left to self regulation is as corrupt as many other things in this amazing country. Is it any wonder. It is certainly indefensible.

There is clearly only one response to this issue and you guys (Sunbelt and Quicksilva) have my utmost respect.

Gravelash, you are in a monority and bordering on appeasement for fraud and substandard practices!

Thought you had decided to leave the libelous comments alone Twix, just need soemone to lash out at? I didn't sell your property, and if I had we would have had a commission contract, but never mind that. Sometimes being forthright can stir things up, should have kept my mouth shut, ah well. There is a real estate association of some sort in Thailand, but as far as I know membership is meaningless. Sunbelt has your utmost respect and I am in a minority for appeasement, eh? Sunbelt when taking a 10% commission on a business sale can of course afford to take a higher than thou stance. We charge 3% on residential or business (some charge 5%), so who is ripping who off. This is not a dig at Sunbelt, that is the usual commission for businees sales ouside of Thailand, they attract a better percent than residential. I mention it to put their comments in perspective. But if we want to discuss practices outside of Thailand, then on real estate there is usually a miniumum fee up to certain price, then a percentage thereafter. That would be nice for cheap properties as there isn't much in them. But that isn't the usual practice here is it? Is anything usual here?

If real estate agents were raking in 10% like Sunbelt then there probably wouldn't be any net pricing in Pattaya, what for, that is already making a killing. As I have said repeatedly it is the Thai owners that "sometimes" want this, we comply accordingly and transparently. As I also stated the end result is usually about the same anyway. I rarely get a foreign owner asking for net but it has happened.

If the government were to make it illegal I have no problems with that, we would tell the Thai owners and that is that, net sales are a minority. Again I reiterate I don't know Pattaya practices, although nothing would surprise me. In a sellers market you could potentailly use that to make some money. However it certainly is not a selllers market here, in fact the opposite.

Why didn't you sell your property with Sunbelt?

[twix38]

Gravelrash,

I have NOT sold my Condo. It is on the market. I made a frank and uncompromising observation from my experience and distastefull dealings once being informed of this common and dire practice here.

You may rarely get a foreigner asking for a net price. In Pattaya I rarely go into an Estate Agent and don't have them suggest it, by asking for my net price. Rather, it is a struggle to stop it. I tell them I am on to your little crooked game, and you know what, when we then discuss it they all say it is very common, but they don't do it. Apart from 2 agents that even admitted to me that they do. It's really more like 90% of agents who can't resist it, if they get the opportunity and they can certainly try to make the opportunity.

I am not lashing out, but how do/would you feel being made aware that your property sold for 4 million, although you only got your net price of 3.8 million, irrespective of fees and taxes also paid. The net price has been used as a maximum. Then you realise why the agent was pushing a little or just asked for your net price. It does happen. Blimey I am being told by agents themselves it happens, so it must be common enough!

Perhaps we should just leave it that you do not know Pattaya practices and I can tell you some of them stink. How's that sir?

Edited February 14, 2007 by twix38

[Sunbelt Asia]

Thought you had decided to leave the libelous comments alone Twix, just need soemone to lash out at? I didn't sell your property, and if I had we would have had a commission contract, but never mind that. Sometimes being forthright can stir things up, should have kept my mouth shut, ah well. There is a real estate association of some sort in Thailand, but as far as I know membership is meaningless. Sunbelt has your utmost respect and I am in a minority for appeasement, eh? Sunbelt when taking a 10% commission on a business sale can of course afford to take a higher than thou stance. We charge 3% on residential or business (some charge 5%), so who is ripping who off. This is not a dig at Sunbelt, that is the usual commission for businees sales ouside of Thailand, they attract a better percent than residential. I mention it to put their comments in perspective. But if we want to discuss practices outside of Thailand, then on real estate there is usually a miniumum fee up to certain price, then a percentage thereafter. That would be nice for cheap properties as there isn't much in them. But that isn't the usual practice here is it? Is anything usual here?

If real estate agents were raking in 10% like Sunbelt then there probably wouldn't be any net pricing in Pattaya, what for, that is already making a killing. As I have said repeatedly it is the Thai owners that "sometimes" want this, we comply accordingly and transparently. As I also stated the end result is usually about the same anyway. I rarely get a foreign owner asking for net but it has happened.

If the government were to make it illegal I have no problems with that, we would tell the Thai owners and that is that, net sales are a minority. Again I reiterate I don't know Pattaya practices, although nothing would surprise me. In a sellers market you could potentailly use that to make some money. However it certainly is not a selllers market here, in fact the opposite.

Why didn't you sell your property with Sunbelt?

Our fees are the industry standard. In business acquisitions, the range is 10% -13% on SMEs with a $10,000( 350,000 Baht)minimum -$15,000 ( 525,000 Baht) minimum. Our professional fee in Thailand is 10% or 50,000 Baht minimum. Comparing a business transfer with an real estate transfer is like comparing an apple with a elephant.

In real estate, the industry standard is 3- 5% on sales or one month rent. Our professional fee is 3% or one month rent. We have never ever taken a higher amount on real estate.

The difference is our professional fee is disclosed to all parties. The buyer and the seller are aware of how much the fee is, before they take over the business. Over a paragraph on the Sales and purchase agreement is devoted to our professional fee and exactly how much it is. It’s also on the offer to purchase before they even do due diligence.

Most people would not have a issue if a agent took even a higher fee than the industry standard but what they do have a problem with, is the nondisclosure to BOTH the buyer and seller what is going on with the fees and price.

www.sunbeltasiagroup.com

[twix38]

hear hear Sunbelt Asia.

SPOT ON!

[quiksilva]

Our fees are the industry standard. In business acquisitions, the range is 10% -13% on SMEs with a $10,000( 350,000 Baht)minimum -$15,000 ( 525,000 Baht) minimum. Our professional fee in Thailand is 10% or 50,000 Baht minimum. Comparing a business transfer with an real estate transfer is like comparing an apple with a elephant.

In real estate, the industry standard is 3- 5% on sales or one month rent. Our professional fee is 3% or one month rent. We have never ever taken a higher amount on real estate.

The difference is our professional fee is disclosed to all parties. The buyer and the seller are aware of how much the fee is, before they take over the business. Over a paragraph on the Sales and purchase agreement is devoted to our professional fee and exactly how much it is. It’s also on the offer to purchase before they even do due diligence.

Most people would not have a issue if a agent took even a higher fee than the industry standard but what they do have a problem with, is the nondisclosure to BOTH the buyer and seller what is going on with the fees and price.

www.sunbeltasiagroup.com

I can also vouch that the market standards for real estate transactions are exactly as Sunblet described. The only times we have earnt higher fees than what has been stated is when landlord's have offered additional incentives for a slow moving property or bonuses for a job well done.

[Gravelrash]

hear hear Sunbelt Asia.

SPOT ON!

I will leave this thread alone after this, will concentrate just on religion and politics, much safer! As I said I was not having a go at Sunbelt, they are transparent, as are we. I am sorry if you are having troubles in Pattaya, hopefully you will find someone that will sort things out professionally and transparently, as everyone has the right to expect.

Final comment, don't assume everyone is a scam artist, like everything here just do your homework first. Does this mean now you are going to buy me a beer if I ever get to Pattaya again?

[popshirt]

I think it is a good thing to have the choice between net price and fixed commission. I have listed property for net price and done well. This was MY decision as seller. And I am not a Thai seller. I just want the property sold and at the price I want. Nothing wrong with that.

Next we will have to struggle with child-proof caps on medicine bottles which is the bane of my existence in the west! Let's regulate everything, shall we?

And some will still find something to be livid about!

[twix38]

Gravelrash,

If you find yourself Pattaya way, I would be very delighted to buy you a beer. Thanks for your viewpoint and all the best.

Popshirt,

Of course you should have the choice to go for fixed commission or net price. That's not the issue.

If you go for net price, I assume that you then just walk away and the estate agent keeps anything extra (if there is anything of course) as a bonus on top of whatever may have been a reasonable commission that they will of course have allowed for in the final sale price and you are happy to receive your net price. Once again great.

How about what I am talking about, though? Where the seller agrees that the commission rate will be say 3% or 5%. That is the Estate Agent's fee addressed and taken care of. Then the seller is asked for their net selling price and told the estate agent will plus all "costs on top" of this net price (i.e. their commission and any transfer tax etc. Not always explained, although should be obvious enough). This will then be the new sale price.

If the estate agent receives more than the agreed "costs on top" of your net selling price from the buyer, I wonder who has given the estate agent permission to keep that as well in this typical example?

You may do, but believe me most sellers are ignorant of the fact that any more money received will not be passed on! Clearly the seller has agreed a commission payment already for the estate agent. Few people are happy to pay lots more than has been disclosed or agreed!

Especially when this extra amount can in some cases amount to tens and hundred(s) of thousands of Baht which the seller (owner of the asset) should receive unless he has a contract detailing that he has set a maximum amount payable (cheatingly also often known in the trade as a "Net price") and further more that he/she realises what they are actually doing in this regard. It is NEVER stated or even mentioned that this practice will happen, of course.

As I and the professionals have stated. It is a scam and fraud.

Not totally, but at least in large measure because there is no regulation as it attracts and perpetuates this behaviour. Nobody wants red tape for it's own sake, but neither do we want the wild west!

It is played as a game to cheat and get a nice big extra bonus by some.

Think of the used car salesman's reputation and then double it for many of the wild west Pattaya estate agents who indulge occasionally or more regularly, but always secretly.........................Simple as that

Edited February 18, 2007 by twix38