Market watch: Estate agent 'bribes' get seal of approval
Daily Mail - UK
Regular readers of this column will know about the practice of referral fees, or bribes, as most fair-minded people would describe them. This is when estate agents demand payments from solicitors – often £300 a time – for recommending them to homebuyers who come through the door.
Estate agents demand similar payments from surveyors they recommend, mortgage brokers, energy report providers and, quite possibly, from the cafe down the road where you might be heading for a coffee.
Across the country there are impoverished solicitors, members of a regulated profession carrying expensive indemnity insurance, who are so in thrall to the local manager in a cheap suit who heads the estate agency chain that they are prepared to sacrifice half their fees in order to get conveyancing work.
They detest the practice of referral fees, but most won’t speak out publicly against them or rock the boat by, perhaps, warning homebuyers not to go through with a homebuying transaction. Such an action would certainly upset their relationship with the estate agency.
The conflict of interest here is blindingly obvious, and the Law Society – these days merely the trade union for solicitors – has called for referral fees to be banned. Last year I revealed how consumers’ interests had been affected by the practice.
When is the right time to buy a home?
RealEstateWeb - South Africa
Ask any estate agent at any time if now is the right time to buy a home and the answer will be affirmative, with all the obvious reasons being offered, such as: it is a buyers' market, rather own your home than rent, the market is turning, it's a good investment, and so on.
It's interesting to use the popular area of Beacon Bay as a case in point. There are approximately 3 300 households in Beacon Bay, of which 32 percent have lived in the area for more than 11 years, and 33 percent for less than five years. Here the average person stays in a house for six to seven years.
In 2004 the average price for houses sold in Beacon Bay was R549 000, doubling to just over R1 million in 2008. From 2008 to 2010 there was a further 20 percent increase with the result that in 2010 the average price of a house sold in Beacon Bay was just over R1.2 million.
Illegal estate agencies surrender
Business Report - South Africa
An estimated 10 000 estate agencies were operating illegally and since the start of a six month amnesty period, more than 4 000 illegally operating agencies had surrendered, Thami Bolani, the chairman of the Estate Agencies Affairs Board (EAAB), said on Friday.
Speaking at a six-month residential property review in Cape Town, Bolani said by the end of the amnesty term, the board expected at least half of the illegal agencies to have come forward. "If there's still interest after that period, we will expand it by another three months," he said.
Bolani said the EAAB had investigated six big organisations since January and more than R70 million had disappeared from the trust funds of these estate agencies. Bolani said the deadline for compliance would be extended for the estate agencies who had valid fund certificates issued after July 15, 2008.
FNB Property Barometer
FNB – South Africa
There has been a very significant change in the composition of “factors that influence agents’expectations of near term activity levels”. For a number of successive quarters, interest rates were top of the list,and largely seen as a positive factor in driving demand. The 2nd quarter survey saw “Economic Stress/General Pessimism” rising quickly to the top of the list, with 31% of respondents citing this as a key issue.
Also rising in prominence is the National Credit Act, which is now above interest rates in prominence, and largely cited as a negative factor making it tough for people to get loans.
The decline in prominence of interest rates, which were seen as a major positive while they were declining, suggests that their impact is wearing thin. The fact that agents point to widespread financial stress, while interest rates are so low, bodes ill for households when interest rates do ultimately rise once more. It would suggest that the household sector has not yet recovered from the 2008/9 recession.
FNB Property Barometer_Home Buying Estate Agent Survey_2nd Quarter 2011