What do estate agents do to justify 7 or 8% commission? Or even 10%!

[Sunday Driver]

[quote user="hastobe"]
Use yellow pages and telephone the notaires?  Actually go to France and drive around??

Kathie
[/quote]

Given the number of people moving to France who can't speak the language, phoning up notaires out of Yellow Pages is not really a practical option.  Nor is driving around France - it's a big place!

 

[hastobe]

[quote user="Sunday Driver"]

[quote user="hastobe"]

Use yellow pages and telephone the notaires?  Actually go to France and drive around??

Kathie

[/quote]

Given the number of people moving to France who can't speak the language, phoning up notaires out of Yellow Pages is not really a practical option.  Nor is driving around France - it's a big place!

[/quote]

But the poster was suggesting that the estate agents were necessary for Brits who wanted to move to France.  I was just pointing out that this  only applies to the Brits who a) decide to move to a country without even the basics of the language and b) (even worse) haven't narrowed down their area of search or (worse still) haven't even visited France before!!  For the average French person / prepared Brit buyer both of the above are entirely workable options.  As an aside the notaires have a pretty good website - with email addresses (if you are more confident at writing French than on the phone).

Kathie

[hastobe]

[quote user="Miki"]As for buying through a Notaire, we have always bought wherever we wanted or needed to be, either for commerce or living

[/quote]

I agree Miki - at the end of the day you want the house that is right for you - but in a buyers market the house has to be pretty damn special to justify an 8-10% agents commission.

Kathie

[KenB]

I needed an agent when I came to France looking for a house in 2002, despite the fact that I speak French fluently and had lived here (in Paris) for several years earlier in life. I lived in California in 2002, and on the Internet I had seen a lot of properties for sale in my area of choice, the Loire Valley east of Tours. But I need to see them for real to see if my plan was realistic. For various reasons, I could only take one week for an exploratory trip to France that year.

I contacted an agent and he showed me 15 houses in four days time. He recommended a house that I would probably have rejected after seeing it on paper. But he was right -- it was the one I bought. He also smoothed the way to my getting a bank account opened and starting to work with a notaire. As a result, I bought a house in less than a week, with no fuss and no muss, as we say. I've been living here for the past three years and am very happy with it. For me, the 7% fee was acceptable because I got a good house at a very good price.

[Anton Redman]

It is not the percentage which is the issue for me it is the absolute amount of money.

In the UK we sold for just over 1.2 % , in France we paid the agent more than double the amount of cash for a house which was less than 20% of the value. For the most part if French estate agents had accurate plans,decent particulars and maps which explained clearly where their properties stood most of their complaimnts about wasted time would disappear   

[andyh4]

So you paid over 11% Anton - in any calculation you were robbed.

[Quillan]

For those that think UK agents are wonderful or offer good value for money I watched the news on telly last night (17/11/06) and in particular the item on rogue estate agents and sharp practices. It would seem that because only two thirds of UK agents have voluntarily joined ombudsmen’s schemes the government are about to push through legislation making it compulsory for agents to join a professional body. This means people will be able to take legal action if they are not happy with the way they are treated or if they discover problems with the property after the sale. This has come about apparently because of a documentary where people were ‘sent in’ under cover and the sharp practices used by agents were filmed. One of which was to over value property so that when the buyer makes an offer they are guided to reduce to an amount which is really what the seller wanted in the first place. I have to say I never saw the said documentary but it must have been pretty grim for the government to force through this sort of legislation.

When I sold my house in the UK at 1.5% commission it never got as far as the agents window, it was sold in under 4 hours. Not bad work for the agent. My house in France on the other hand was on the market for over a year before we bought it which is quite the norm round here.

[Dick Smith]

When I was working for an estate agent (1966-67) there were proposals that agents should be made to join a professional body...

[Quillan]

Good grief its taken government 40 odd years to actually get something done then. I rather suspect that if it were not for the documentary they would still be waiting for legislation, touch of reactive as opposed to proactive. I believe with the new system being proposed there can no longer be 'get out' clauses on the bottom of sales documents.

[Russethouse]

The government want sellers all to put together 'sellers packs' I think that is on the back burner also.

When we bought this house I saw the estate agent taking a picture of it and had an appointment to view before the estate agent got back to his office - we viewed the property that night, the seller accepted a verbal offer and he went round to the pub (5 mins away) to celebrate, with a couple of halfs - he went outside and dropped dead on the pub door step !

Then the estate agent REALLY had to earn his money - it was a nightmare for over 6 months.........

[Deimos]

Maybe somebody in the industry might know, but one thought I had is that it seems that property moves a lot slower in France. I have the impression that people buy and sell their houses (i.e. owners move) less often. Maybe less pressure to "climb the property ladder". Thus, there are fewer house sale transactions going on than in the UK. Thus, a French agent might sell a house less frequently than a UK agent. They need money for staff, offices, etc. so given that they probably need to charge a higher rate get get enough euros in.

(I appreciate it is more complex than that as e.g. salaries and office costs might be lower in France, but then so are house prices so each sale generates less, etc.)

Above is all my impression and NOT based on any knowledge or fact. Just interested what people in the know think.

Ian

[hastobe]

[quote user="Deimos"]

Maybe somebody in the industry might know, but one thought I had is that it seems that property moves a lot slower in France. I have the impression that people buy and sell their houses (i.e. owners move) less often. Maybe less pressure to "climb the property ladder". Thus, there are fewer house sale transactions going on than in the UK. Thus, a French agent might sell a house less frequently than a UK agent.

[/quote]

But then one of the factors slowing down the market must be the transaction costs - so they have created their own problems....

Kathie

[KenB]

In the U.S., the seller pays the real estate agent's fee. I paid about $40,000.00 when I sold my house in California. How does that sound compared to what you might pay in France? Of course, here in France it's the buyer who pays. When I moved to France, I got hit coming and going. But it's all just part of the cost of such transactions. You can drive yourself crazy worrying about the details rather than just looking at the overall cost, and profits, of buying and selling property.

[David]

In this thread I really do think that you should distinguish between England and Scotland, rather than using the term UK.  The two systems are very different, and all of the comments I have read on this thread only apply to English estate agents.

Further, in Scotland, both the fairly new estate agents, and the solicitors who traditionally handle house sales, charge extra for accompanied house visits.

David.

[P]

[quote user="KenB"]

In the U.S., the seller pays the real estate agent's fee.

[/quote]

and others will say 'in England the seller pays the agents fee'.

I do find this all very acadaemic. When you buy a property, no matter where it is, the buyer hands over a wad of money, the seller receives part of that wad and the other parts go to the agent, the solicitor / notaire and the government.

When we sold a property earlier this year (in England) at no point were we given all the wad and then paid the agent. The solicitor deducted the agents money from the wad and paid them directly.

When we put the house up for sale, the agent (well several and amazing how different some were - the very low commission rate one a very low valuation, obviously, it would sell far quicker and they would do less work and the high valuation one to get it on to their books and then suggest lowering the price) put it on sale for the valuation figure. We then deducted the agents fee to arrive at what we would realise. Surely, this is the same as the French system but presented another way - instead of stating with the valuation and deducting the fees, in France, you start with the sellers amount and add the fees, and it is this amount that 'normally' is shown in the adverts.

There is no magic cash fairy that pays the agents fees - it comes from what the buyer hands over.

Paul

[Turnip]

I see there is a growing interest in selling via the Internet based estate agent ( £300) which seems reasonable now that many people use the internet to search for property via the like of "Your Move" etc. Perhaps this will one day curb the greed of estate agents?

[KenB]

Agreed, who "pays" the estate agent's fee is academic. It's just part of the cost of the transaction. But not everybody looks at it that way.

[Nearly Retired (I am now)]

It's not the fees that trouble me - you choose to pay or not pay - buy a house or don't. What irritates me is the apparent lack of effort used to describe the property. Typically we got a black and white multi-photocopied A4 sheet with a dodgy picture in the top half and maybe 4 lines of description below. When we were looking we really had little idea of what we'd get until we got to the house. We wasted a lot of our time and that of others.

 It really is time the french agents got up to speed with what can be done. Most UK agents have comprehensive details on the web - floor plans, dimensions and maybe 5 or 6 pictures. They tell you the Council Tax etc. etc. It can't be that dificult to do and as houses seem to stick for longer in France then maybe the effort in presenting good details just the once wouldn't be too much of a burden. You can get colour photocopiers in France too!

On the theme of agents only having cheap cars - it may be because they don't earn much, but don't be conned. In my business in UK I choose my work car very carefully to select the right image (i.e the one I want to project) for my clients.

 

[Llwyncelyn]

Nearly retired on the car front are you saying that perhaps the car you present to your clients in the UK may be let us say a middle of the road (forgive the pun) say Ford but the 'other' car might be a Mercedes?  In saying that I agree with you.  Some of my career was in banking and we used one year to buy from a Ford Dealer for our staff (they being customers) the following Vauxhall (they too being dealers and customers) however we also had a huge VW customer.  Policy was not to buy German! so you can see how long ago that was.  So what did we do when we had to go to see him to renew OD facilities park about a quarter of a mile away for if he saw a Ford or Vauxhall in his lot he would go potty.

In any event as to presentation here in France I absolutely agree with you.  However as to taxes and that sort of thing rateable value and related taxes do not exist per se and therefore they can be excused. 

However four liners and for whatever reason is not good marketing of the property.

In every walk of life there statistically must be good and bad and this applies to the estate agent profession.  Par example my good friend put her house on the market here with a local agent and it went in a week and with a hefty hike over what the notaires said the house was worth.

But.............the description was a four liner!

If it were me and it is not I would do as you suggest and present a glossy well described and documented particulars of the house for it is not a simple concept buying a foreign property in what is still seen as a 'foreign land'  One must have confidence and I would never ever use the same people as we bought from never.....jamais.

Nor would I use the Notaire who valued our friend's house.  Who do you think I would use.............

 

[P]

It seems to me that number 1 priority of the agents is to not let you be able to identify where the property is. Presumably this is to stop people finding it from a description on the Internet and then do a private deal with the vendor.

In searching for a house we came to the conclusion that all you could go on was the description and photo. Some agents provided a lot of detail and photos and others very little. There was one Internet site that we found very good. They advertised properties for many agents but there was normally loads of detail and photos - print them out and the print out for the property would normally take high teens of pages or even in to the 20s. (This site is normally listed if you do a seach for Immobiliers using pagesjaunes - no matter the area there will be a listing for them, or at least if looking in the S.W. - hope the mods do not take this as blatant advertising).

We also found that, with some agents, they would take us to view properties that did not meet with our requirements.

We did come to the opinion that it would be a case of having to just look at what might seem to fit the bill and any that the agent felt we must see and quickly reject any that were not suitable - welcome to the French way of life.

Paul

[Nearly Retired (I am now)]

I share the opinion that french agents' No.1 priority seems to be hiding the location of the house. What a strange way to behave - in most markets the sellers want to supply as much information as possible about the product with which to sway the buyer, and as I said before the more information available at an early stage saves a helluva lot of time on 3 sides: buyer, vendor and agent.

In the UK agents don't have a problem identifying the property and I understand they chase up and get very legal with those sellers who try and avoid paying the fee for the previously "introduced" buyer.

Surely the agents can get equally litigious in France - or is it more diffcult there? It shouldn't be too hard to locate the buyer!

[Le 47]

I have amended the subject line slightly as there is one agent in our area who wants to market the property with a 10% agency fee. I would like to use them but at that level of agency fee mark up they will be marketing it at a higher price!! I will try to get their fee down.

[Benjamin]

Can they explain, or have you asked them, why they need to do that? Or are they just being double greedy?

[bloodyestateagent]

First post, and working for an agent, into the lion's den...

1) Agents don't give precise details for the location of a property. It's true - they don't. In France it is common for the vendor to market their property with multiple agents. Therefore there is not a 'sole-agency' contract between the vendor and the agent - the vendor is free to sell the property to whom they wish. With a property on with  perhaps  4 or 6 local agents  it is very difficult for an agent to keep on top of  who you  have shown a property  to, and more to the point, to prove it. Therefore if an agent were to give the precise details of a property location, and the buyer were to approach the vendor direct,, it would be very difficult for the agent to recoup any agency fee (pretty much impossible in reality).

2) Fee is too high - possibly. I spend a lot of time with UK property hunters. I'd say that well over half the people I see are not in a position to proceed. They either have not sold their property in the UK, do not know which area of France they want to live in or, surprisingly often, have not decided which country they want to live in. Well over half have not decided that they want to buy in the area that I sell property. This adds to my costs as at least half of my time I am spending the day with clients who have not decided if they want to buy a property in s my region

3) Sparce details. Relates to point one. Vendors do not have an exclusive contract with the agent. There are probably 6 agents trying to sell the same property - if not more. With a 1 in 6 chance of a sale it is not beneficial for the agent to spend lots of time drawing up full details of the property - chances are that it will be sold by a competitor. If more vendors opted for sole agency then there would be fuller detailes.

4) Compared to my experience of selling property in the UK the process is markedly different. For example;

The volumes are quite different - as an independant negociator I sell around 2 properties a month - I'd imagine that in the UK I'd sell more than this

The agent that I work with takes half, of the remainder VAT takes just under 20% and social charges take around 50% of what is left.

From what remains I need to pay income tax.

As you can imagine, not much is left after the agency cut, VAT, social charges and tax. In fact, I would say that most negociators end up with less than 15% of the total agency commission that you pay. Far from being greedy, most negociators are struggling to make a living in France.

5) As a general point UK buyers need to understand that things do not work the same way in France that they do in the UK. Too often we hear that "well, in the Uk we do things this way and for so much" - this isn't true in France. People who come to live in France and expect to find systems and processes the same as they were used to in the UK will have a hard time adjusting. The French have a different way with dealing with things, being it it from house sales to inheritance to local government to health provision. Coming to terms with all of this is all part of the great adventure of coming to live in France - in my opinion!

[Pancake]

Bloodyestateagent.

Well that has explained a lot.As a outsider and potential buyer its made things a lot clearer.