For sale by owner or Real Estate Agent?
Posted: Monday, February 06, 2006
by Pedro Rodriguez
Publicity Direct Ltd
For sale by owner v Real Estate Agent
by Pedro Rodriguez
www.sellandbuydirect.com
In some countries “for sale by owner" is quite common. In others the idea of
selling a property in this way is perceived to be difficult, tedious and the
general attitude is that selling a property should best be done through an agent.
I don’t advocate that selling your home yourself is the only way to find a
buyer for your property. On the other hand, I know from many years of personal
experience in this market that listing your property with an agent does not
mean you will sell your property any quicker, easier or at a better price.
This article is not about trying to prevent you from using an estate agent, or
the attempt of portraying agents as unnecessary. There are many good and professional
agents around doing an excellent job for their clients.
I just happen to believe, that everyone can sell his or her home just as well
as an agent can. But let’s get away for the moment from the merits of either
method.
Let us look of how “for sale by owner" actually works in
The Portuguese owners are accustomed to selling their property themselves. One
look in Portuguese newspapers will confirm that. One can find a substantial
amount of properties being advertised using adverts which read “private sale no
agents please" or words to that effect.
A large percentage of Portuguese property owners will try and sell their home
themselves since they are reluctant to pay the agent a commission of on average
3%.
A Portuguese property owner quite often will tell the agent the price he wants
for his property, and the agent has to increase the price by his commission.
Quite a few owners are not prepared to pay the commission from the money they
receive. If the agent wants to sell the property he has to increase the price
by his commission. So at the end of the
day this property is now at the market at 3% more than it needs to be.
Other owners tell the agent the price they want and have already included the
commission of 3 %. Which ever way you look at it, there is 3% in the price.
Few sellers will give an exclusive contract to an agent in
Very few Portuguese sellers will make use of a solicitor. Their attitude is
very simple and clear on this point “It is my property, I have the title deeds
in my name, I have receipts showing that I paid all the taxes and bills
relating to the property I want to sell, so why pay a solicitor? If the buyer wants
to use a solicitor to check all the papers, that’s fine by me"
So here we go, very different attitudes and I am sure quite strange to a
foreigner, but absolutely true. The Portuguese owner needs little or no help
from an agent other than the introduction of a buyer and more often than not he
thinks he can find one himself just as easily by advertising privately. The
seller knows that the agent himself will use the same papers to advertise in as
he does. So what is the difference?
Many Portuguese estate agents do not have effective websites and little access
to foreign markets and are using local advertising only.
The foreign buyers market works a little different, not much but a little. The
most significant difference relates to the buying behavior of the Portuguese
people and that of foreigners wishing to buy a property abroad. Foreigners who
already live in
Foreigners who wish to buy in
In a nutshell this is what happens 8 out of 10 times. Quite naturally, the
overseas buyers are relying more on an agent. Language problems, not
understanding the system, not knowing anybody, feeling strange in a foreign
country are just some of the reasons.
I don’t believe that foreigners wanting to buy in
Foreign owned real estate agents work normally on 5% not just on 3% commission.
This is a big chunk of the overall price. Money better off in your pocket.
Just consider for a moment how easy it is to find a property on the open market
and how easy it is to find an English speaking solicitor and how easy it is to
go and view properties yourself.
Does that sound too much of a problem? Just sit back and think how much you can
gain in monetary terms buy doing a little legwork yourself.
Not every property seller is Portuguese and a lot of Portuguese speak English.
And if you really need an interpreter go and see your solicitor. He will help
you. He will talk to the seller He will make the viewing appointments for you.
What you need are a few reliable reference points, such as your solicitor and
you are in a position to organize the purchase of your new home yourself. I
like to leave you with a final thought. Let us assume you are buying a property
for say 300,000 Euros.
The agent’s fee is likely to be in the region of 18,000 Euros including 21% IVA
(VAT). If you like to receive some more information on how to find a property
yourself, visit our website. www.sellandbuydirect.com
good article, good content. It is an eye opener for me.
I agree with Jan, your article is interesting. Real Estate is a full time vocation and career for many Agents. We are already geared up to do showings by appointment, advertise, take photos, upload to the MLS, do market analysis. Many people can and do sell successfully FSBO. Its a choice. I can cut my own hair or go to a hair stylist. There is much propoganda either direction.
