Why Use An Agent When Buying Off-plan?
Let me start by giving a debatable saying: Contrary to popular belief, a good estate agent is worth his weight in gold.
It’s true that there are also some ordinary individuals working within the industry whose professionalism or industry knowledge is questionable. Regrettably it is these individuals who let the industry and themselves down and who often leave clients feeling incredibly frustrated. The good agents on the other hand add a considerable amount of positives to any buyer’s process and are often the difference between successful transactions or aborted deals.
Buying property can be an emotive process especially when buying to live in and is because of this that added stress often takes over making the whole process a nightmare for some people. Whilst some developers do launch their products directly to the market, it is not uncommon for them to enlist the help and support of estate agents when selling their projects. They do so to get greater coverage for their development in the hope of selling out quicker.
When a developer instructs too many agents, this can sometimes have a detrimental effect on the project especially if the developer doesn’t screen exactly which agents are publicising their projects or indeed how they are actually marketing.
Most agents will be selected on merit and reputation to market the project by the developer on either an exclusive or non-exclusive basis. Each agency will attempt to attract buyers by aggressively marketing the project. It is these non-exclusive projects that a buyer often then sees advertised over and over.
In 99% of cases, the developer is paying a commission to the agent so a buyer is free to proceed with one of these agents or indeed go directly to the developer if they so choose. In either case there will not be a commission payable by the buyer which in contrast, is the common practice when buying in the secondary market.
The question whether to go directly to a developer or via one of the real estate agents can be answered in a similar fashion when deciding to book a hotel; does one book directly or use one of the many travel portals like booking.com etc.? In most cases, going through an agency will benefit the buyer as there is a buffer between buyer and seller and the agent is there to help and guide in the transaction. The agent can act as an intermediary and often has a good relationship with the developer that on occasions leads to achieving a sale at a better price or better terms than if the buyer went directly.
For first time buyers or buyers who are not familiar with the whole buying process, agents can explain the next steps and guide them throughout the transaction. It’s all about relationships and economies of scale. In these situations, it is this relationship that highlight the main reasons why a buyer ought to proceed to buy a property via an agent rather than go directly through the selling developer.
Mario Volpi is the Manager of Residential Sales and Leasing at Engel & Völkers with over 25 years experience in London & Dubai Real Estate.