Mathew Wood, our resident real estate expert from Hola Properties – headquartered in Lanjarón – explains the sabotage situation that could chase off your buyers – and how to avoid this costly mistake.
SELLING a property in Spain can be daunting – especially when navigating the special customs and practices of the Spanish real estate market. Amongst the many strategies adopted by sellers, there’s one that can easily deter most of your potential buyers. In a recent survey conducted by Hola Properties, 97% of respondents disapproved of a particular practice – that of charging a buyer’s fee.
So what is a buyer’s fee?
In Spain, unlike in many other countries, it is totally legal for real estate agents to charge a buyer’s fee. This fee is usually presented to sellers as a cost-saving measure. It goes like this: “You won’t have to pay the full commission…!” However, what seems like a win-win for the seller can actually be a loss in disguise.
From the perspective of the buyer, being asked to pay an additional fee on top of the purchase price is unwelcome and possibly a dealbreaker. In the survey, 97% of respondents said that they would either offer significantly less for a property with a buyer’s fee, or avoid it altogether. Even worse for the unsuspecting seller: 57% of respondents said they wouldn’t even consider viewing or making an offer on such a property.
The emotional response – feeling cheated
The emotional reactions from survey respondents highlight why a buyer’s fee can be detrimental. Many buyers feel cheated or mistrustful of an agent who tries to impose this fee.
Comments from the survey ranged from, “I would not pay the agent a fee. Goodbye!” to “I wouldn’t trust an agent that does this.” The overwhelming sentiment was that this practice discourages offers and tarnishes the reputation of the agent and the property they represent. You don’t want your agent to be using the ‘Only Fools or Horses’ (aka houses) playbook to do business!
The feeling of being unfairly charged and financially manipulated leads many buyers to walk away, sometimes without even viewing the property. Even if they have viewed it, and liked it, they might decide not to make an offer. After all: who are these dodgy people with their weird fees? The natural reaction is one of skepticism — this arguably should be part of the seller’s expenses.
The financial impact: losing out on a fair market price
For sellers, the implications are serious. Even if you do have potential buyers sticking around, the likelihood of receiving a fair market offer can be dimished because of that unwelcome fee.
A reduced pool of interested buyers naturally leads to fewer offers and reduces competion over your property. In turn, this drives down the final sale price. If you do agree a sale, you may receive less than your property’s true value. This outcome is particularly painful when you thought the buyer’s fee existed to save money on your commission costs!
Why some agents are out of touch
Despite these clear downsides, some agents in Spain insist on charging buyer’s fees, arguing that it’s a “standard practice” in certain regions. In reality, it is a relic from the past way of doing property transactions. It is increasingly out of kilter with what buyers want and expect in today’s modern market.
Remember that using this outdated approach is potentially damaging to the reputation of your agent, your property, and even you. The best approach is transparency and fairness for everyone involved in the property transaction. As well as having your paperwork in order before putting your property on the market, you should consider not alienating buyers and creating an avoidable self-sabotage situation!
Don’t derail your sale – be professional
The message is clear: with any property transaction in Spain, always use industry professionals who are in touch with the current property market and will guide you through the process in a fair and legal way. Using amateurs and “Del Boy” can lead to your property sitting on the market and/or financial losses on your part.
To see the full video of this topicwith with the poll results, click here
