Real Estate Agents Why Is The Commission So High Here ?

[soioldkentroad]

Real estate agents wihy is the commission so high here, 5% is really extortionate, In the UK 1% is normal, I wonder what excuses and storys the Agents have for such high commission, It must be the Pattaya syndrome.

[Naam]

fees for realtors in the U.S. of A. 7%, in Germany and Switzerland 5%.

[susanschwaiger]

maybe you can try more agents.

When we bought our condo 2 years ago in North Pattaya, the commission fee was 1.5% or even less (can't remember very precisely), and paid by the seller. And they say, the higher the total amount, the lower the commission percentage.

[ShopBoy]

change agent

3% industry practice

[soioldkentroad]

iv tried at least 6 agents and theyve all said the same, 5 % unless its a high end market house then they will negotiate

[JSixpack]

"Why" is an irrelevant question in Thailand. TIT.

[Postmaster]

soiold. Yes, I think the same. Why commission so high at 5 %. It is too much. They do not print sales literature. They don't seem to advertise widely. They even suggest you take your own photos or burn them a CD copy. It is daft. Only 1 % to 2 % in the UK with glossy sales literature, newspaper advertising, supervised viewings, follow ups and everything included, Window advertising everything.

Susan. Its the same wherever you go. 5% not negotiable. With some hard bargaining however you ARE ABLE to get it down to 4 %.

We should start something here to get acknowledgment of the fact that 5 % is just NOT ACCEPTABLE for the service provided.

[OMGImInPattaya]

In California, real property commissions are generally between 4-6 percent (commissions are negotiable)...so 5 percent doesn't seem out of the ordinary. Commissions here are also negotiable to my knowledge. Also, there is no "exclusive listing" system here in Pattaya (unless it's negotiated for) so without a high commission there would be little to no incentive to put in any money/time/effort to sell a property.

[Phil Conners]

I've both bought and sold property here and never paid more than 3%. It's not like there's a shortage of agents, just ask them for the rate and if they quote 5% keep walking. Don't see why this is a problem.

[susanschwaiger]

The apt we bought were co-owned by a Thai lady and Farang. And the Thai lady negotiated with the agent for details. Am not sure if Thais can get more favourable terms. Just guess.

PS: The agent is called "Power Waves Estate" in Soi 5 of Beach Rd. The agent lady's name is Nan.

[parallaxtech]

I sold my house in the Caribbean recently and it was 10% commission!!! The agents all got together and agreed to make it a standard 10% so you didn't have a choice. When I sold my house in Florida it was 6%, which I didn't feel was unreasonable. One guy selling his house here in Samui has told the agents that he will only pay 2%, take it or leave it, so you might try that and see if it works.

[sotsira]

Because they want as much money as they can get with as little effort to work for it.

[Ohio]

USA in Nevada was 5% last year - originally quoted 6%

Got an Aussie Property for sale & all quoted 3% ( got a little better from an acquaintance)

Guess it's what the Client will pay but it seems to me there are a plethora of Agents here to be able to shop it around.

IMO

[ThaiBob]

In California, real property commissions are generally between 4-6 percent (commissions are negotiable)...so 5 percent doesn't seem out of the ordinary. Commissions here are also negotiable to my knowledge. Also, there is no "exclusive listing" system here in Pattaya (unless it's negotiated for) so without a high commission there would be little to no incentive to put in any money/time/effort to sell a property.

Yes, but in California the fee is split between the buyer's and seller's agent. I wish that were the same practice here. The buyer has no one to look after his interest unless he hires a lawyer.

[BlackPuddingBertha]

Its the same wherever you go. 5% not negotiable. With some hard bargaining however you ARE ABLE to get it down to 4 %.

Actually there are one or two reputable agents that advertise as charging "only" 3%. Personally I think that 3% is still 3 times what they are worth because, as mentioned by others, they do bugger all and are extremely incompetent. Many of them cant even write or read English, and I'm talking about the ones that reckon to be native English speakers, not the Russians and Thais!

But 5% is fantasy and it is negotiable, just like everything else to do with property here. So the answer, as mentioned, is to negotiate hard and if you dont get what you want just walk out and go next door to another agent. After all, real estate agents probably outnumber massage parlours here these days, so you surely wont have to walk far.

[BlackPuddingBertha]

Yes, but in California the fee is split between the buyer's and seller's agent. I wish that were the same practice here. The buyer has no one to look after his interest unless he hires a lawyer.

Do you seriously imagine that any agent, anywhere, is looking after anyone's interest but his own? If so you are very foolish. Only one thing interests any agent: the commission that a sale earns him. End of story.

[TommoPhysicist]

Hang a sign on your gate like the Thais do and pay 0%.

[ThaiBob]

Yes, but in California the fee is split between the buyer's and seller's agent. I wish that were the same practice here. The buyer has no one to look after his interest unless he hires a lawyer.

Do you seriously imagine that any agent, anywhere, is looking after anyone's interest but his own? If so you are very foolish. Only one thing interests any agent: the commission that a sale earns him. End of story.

I understand your sarcasm and it is probably warranted here in Pattaya, but in California when you list with an agent, you are getting a professional to represent your interests. Besides negotiations, they can assist with getting financing, building inspections, home warranties, etc. Money well spent. Wish they had the same in Thailand.

[BlackPuddingBertha]

Besides negotiations, they can assist with getting financing, building inspections, home warranties, etc.

I'm sure they do. I'm equally sure that they get more commission for arranging said services, and will generally point you towards the service provider who pays them the most.

Agents' only real interest is what happens to their wallets, and as far as I'm concerned this applies worldwide. They are surely worse here than in California though, not least because California probably has something approaching laws to regulate the way they behave there.

[PattayaPhom]

Example at 1% Nirun condo 500,000 Baht equates 5,000 commission, For that is at least 2 viewings for the buyer, contracts for deposit, trip to land office not to mention marketing, staff etc etc etc. Do the maths yourself

[PattayaPhom]

Besides negotiations, they can assist with getting financing, building inspections, home warranties, etc.

I'm sure they do. I'm equally sure that they get more commission for arranging said services, and will generally point you towards the service provider who pays them the most.

Agents' only real interest is what happens to their wallets, and as far as I'm concerned this applies worldwide. They are surely worse here than in California though, not least because California probably has something approaching laws to regulate the way they behave there.

That may be true for some but when a large percentage of customers are referrals a fast buck isn't worth it.

[Heng]

We pay our agents 8% (for our neighborhood projects) and 10% (if they are selling our condos). The profit margins make it possible.

[PattayaPhom]

Hang a sign on your gate like the Thais do and pay 0%.

And wait ten years to sell it

[JSixpack]

It's the recurring HATE REAL ESTATE AGENTS thread! Sure did miss it.

[gerry53]

I sold my house in the Caribbean recently and it was 10% commission!!! The agents all got together and agreed to make it a standard 10% so you didn't have a choice. When I sold my house in Florida it was 6%, which I didn't feel was unreasonable. One guy selling his house here in Samui has told the agents that he will only pay 2%, take it or leave it, so you might try that and see if it works.

I find a 5% fee extremely unacceptable, especially in a poor market condition like we are experiencing now with used houses and condos. On a rising market where you are showing profits it is easier to accept and absorb. On a 10 million baht house you would have to pay the agent 500,000 baht!

The agent only has few thousand baht invested in printed material, internet ads and time. He will share his fees with his office - these often large companies have a vested interest in seeing these fees remain high and they have many agents scrambling to make them money. The agent and these companies have little or NO risk but a large profit if they lead a buyer to you.

The seller has a large investment of HIS hard earned money, possible interest, no income often for years, upkeep, taxes and or fees, insurance, maintenance, etc, etc.

I think sometimes we get so used to being suckered we think it is normal.

[PattayaPhom]

Few thousand baht.... You really think that's all it costs to list, market and sell a property,,,employ and train staff, host website and server, vehicle maintenance and running costs, utilities, taxes, etc etc etc

[Phil Conners]

I sold my house in the Caribbean recently and it was 10% commission!!! The agents all got together and agreed to make it a standard 10% so you didn't have a choice. When I sold my house in Florida it was 6%, which I didn't feel was unreasonable. One guy selling his house here in Samui has told the agents that he will only pay 2%, take it or leave it, so you might try that and see if it works.

I think most countries have laws against cartel pricing?

[gerry53]

Few thousand baht.... You really think that's all it costs to list, market and sell a property,,,employ and train staff, host website and server, vehicle maintenance and running costs, utilities, taxes, etc etc etc

Not much more. If the agent has 100 listings then the costs are shared. The real estate company he works for usually has many agents not just 1, their costs are shared also as are the commissions. Renumeration is mostly commission - training they can get from any bar girl on how to empty a farang wallet and leave him smiling!!!

They are not supplying a labor intensive service or supplies like a builder or tradesman and their costs are minimal. As long as people like you accept and justify that 5% is the cost of selling a house with a bit of profit included real estate sellers will be very happy. I am sure they thank you for your support.

[englishinsiam]

5% is also the norm in Spain unless it's over a million euros then it's usually about 3%

Also I've never seen 1% in the UK it's nearer 2-2.5 depending on location and value. They will also tie you into a sole agency agreement.

It's simple if you don't like the process don't use them no need to start a pointless post about it.

Sent from my GT-N7000 using Thaivisa Connect App

[smedly]

do you really need an agent to sell anything here, we have many websites including TV, once you have and interested buyer then involve a solicitor to do the paperwork, do the money exchange yourself - never allow a solicitor or 3rd party to hold your dosh - it might disappear and will be very hard to get back