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Portugal Warning

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  • Portugal Warning

    Hello all
    I have been spending time looking around the web for a little place to buy in central Portugal over the last few months and have been on a couple of viewing trips.

    i have noticed a worring trend.

    There are companies advertising property that look like official estate agents, but on closer inspection are not legal and registered to be estate agents in Portugal, there are dozens of these companies on the web and even advertising in magazines.

    The problem is that some of these companies are not legal and are not working within the government guide lines for estate agents, and have no one to answer to when things go wrong, they are more likely to just tell you anything to get a sale.then you want see them for dust!!
    They are not registered with the governing body INCI and a lot of them dont even have a registered office they just operate from home. they will have no insurance should you need it if the sale goes wrong.

    I am choosing to steer well clear of these companies when i come across them on the web. after a little probing they reluctantly tell me they are not legal agents but 'ADVERTISERS' whatever that means, Just think what would have happend if i had tried to buy a house through these guys. i did ring one up and asked what it would cost for them to sell my house they told me 2% commission. they also advertise properties for local estate agents, the agents charge up to 5% and then the ADVERTISERS charge you a further 2% makes it a expensive way to buy a house.

    One other thing that i have noticed while surfing the Advertisers and estate agents sites is that on a lot of the uk based/run Advertisers websites i have found property that is advertised by a local agent, the same pictures, the same ref number, the same details. appear on both the advertisers website and on the estate agents own website, only one very big difference. THE PRICE!! it seems that some of these Portuguese agents or indeed the advertisers are increasing the price sometimes by tens of thousands of Euros when targeting the British market, i have kept links to some of these if anyone would like to see what i mean.

    I find it disgusting that unscrupulous estate agents and English Advertisers will knowingly try to rip people off and overcharge buyers. especially anoying is that they think were all so stupid that we dont check around the web till we find thier website with the same house at a different price! or indeed look in the agents window!!

    take my warning, only use INCI registered estate agents, check them out before you view property with them, via the Inci website. and ask around to see what sort of reputation they have. Be carefull.

    I would advise people not to use ADVERTISERS it will only cost you more money, they are not legal registered estate agents, they dont have licenses, insurance, knowledge of the property laws, planning laws etc, would you trust your hard earned money to someone that has just set up in business to make quick money from people looking for a place in the sun. or to someone that has been trained and approved to handle your purchase,

    To work out who is legal and who is not.

    A fully lisenced and legal estate agency will have an AMI number displayed on all its marketing material, website, business cards etc. they also will have the full company name and address displayed evrywhere too, a lisenced agent will also carry a id card issued by INCI with them at all times, ask for this too.. if you cant find these on a "agents" website, chances are they are not legal, ask them for thier AMI numnber, they will of coarse also have an office, not just a pc and a website!

    sorry for the rant but just like to warn others looking to buy in central Portugal, of course during the last few months i have come across some excellent (legal) Estate Agents who are completly honest and trustworthy and deal with customers in a honest and proffessional manner. I can recommed these proffessional companies completely.

  • #2
    Thanks for the warning, Jon - very good pointers indeed!

    In fact, written up a piece on the Home Move news section here:
    http://www.homemove.co.uk/news/16-01...-portugal.html

    Comment


    • #3
      Its a sad world when people are happy to just rip others off.
      Just think of the large number of people who buy a house through some of these people only to find out afterwards that the price they bought the house for was inflated especially for them!!!
      this practice of over charging buyers is terrible, during the last few months i have come across several advertisers that regularly have property advertised at a much higher price than the house actually is, sometimes several thousands more. the worse case i have seen is from a well known advertiser that had a house at 40,000 euros more than the local Estate agencies.

      I also met up with a couple of these people when i was viewing properties, no office or business address, they just meet up with you in cafe or garage or someplace, show you the property, normally they dont even have copies of the paperwork, they dont know about the property, some have never even been in the house and have only taken pictures from the outside.
      they then try to sell you a house that they have just added 10,000 or 20,000 euros to the asking price. if they are lucky (and they must be sometime) they will get a buyer interested, they then approach the owner and say they will handle the sale, the owner gets the original price, the advertiser gets a huge payment from the unsuspecting buyer!

      the other thing that i have come across a lot was some Portuguese estate agents use these people and thier websites to attract buyers, but because they charge the agencies 2% or 3 % the agents will just increase the price to cover the extra costs, the seller gets the same amount, but the commission goes up. in one particular case an agency added 10,000 euros to every single house they put on an advertisers web site. even the cheaper properties got the 10,000 treatment in effect almost doubling the price of a cheap house!

      If anyone is looking to buy in Portugal, do your homework, check out and only use registered INCI estate agents, dont forget just because they say they are legal doesnt mean they are, ask to see thier license and AMI number etc.

      It turns out that INCI the governing body is trying to stamp out these illlegal agents and websites, some of them have had 20,000 euro fines from the tax people because they are not legal and registered but it does seem that a lot of them are still willing to break the law and take the chance, well i suppose if the fine is 20,000 euros thats just the commission from one house sale!! and they are probably selling one a month so its worth it to keep doing it.

      The more people that learn about these people the better, If your buying in Portugal look around and find the good agents, there are some real gems out there. luckilly i have gone through the rubbish to find the good guys.

      Comment


      • #4
        Learning!

        Hello to anyone I’ve met elsewhere I seem to be finding new forums daily.

        In true Gypsy style I am wandering all over the net getting information.

        jonwr I seem to find you in the same places and appreciate your warning as I note have others.

        Well it seems I started my search the wrong way and am having a major rethink. I am now starting to look at registered agent sites with one problem, despite stories of properties listed in more than one place and more than one price, I can’t find our favourite property anywhere but on an advertiser site (well recommended person though) so no way of checking an inflated price or legal sale etc.

        I know all you regulars will be bored with this but as is usual with all us newbies any information at all would be most appreciated

        Anyway I understand the sun is shining in Portugal today and it is here too but cold.

        Comment


        • #5
          Hi
          If the property is not for sale with a registered Estate Agent, then you are taking a risk, as a lot of these advertisers dont know the laws of property purchase, are not legally allowed to sell property, and if something goes wrong, for example, say they show the property to you and tell you what land comes with it and show boundries etc, then you buy it and someone comes along and says this land belongs to me, what do you do,
          the deeds in Portugal are complicated, registered agents have experiance and training to check paperwork, illegals dont, they could tell you anything then disapear when it goes wrong. they have no insurance to compansate should you pay for a house and end up loosing the land or something.

          what area are you looking in, if its central portugal, then i know a lot about the agents and the illegals, as i spent a fair bit of time with them looking for a place, and belive me there are some very dodgy people out there that would rip you off as quick as look at you. most of these dodgy people pretend to be agents, or they may even tell you that they are not, there is no reason why anyone should buy through someone operating illegally, most of these guys dont even pay tax on the huge commissions they put on top of a property.

          i have come across some very good agents that are very good at their job, honest and trust worthy, i have made a list of my findings good guys and bad, if you want to tell me who you are thinking of buying through i can tell you if i have come across them before and if they are any good. (in my opinion)
          jon

          Comment


          • #6
            a bit disillusioned

            Hi
            I've been wondering about the non registered property sites for a while. What gets me is the claim that they advertise properties direct from the owner conjuring up images of elderly portuguese country folk finally making a bob or two after years of penury. In fact the owners are commonly hard nosed buisnessmen sometimes foreign, who have gone round the Portuguese countryside(or get agents to do it for a %) buying up properties at dirt cheap prices from local farmers and then flogging them via the property sites at inflated prices to overseas buyers. So the farmers are done over and the overseas buyers too. Not very ethical I say.

            Comment


            • #7
              An other way to do things

              Hello to you all.

              I am French and Portuguese. Last year I bought three flats in Aveiro. 2 of them by agencies and one direct from owners. I don't see where the problem would be because I buy them In front a Notario. The Portuguese legal representent of the state for transactions.

              A few years ago in Portugal, maybe 10 years ago you won't see many agencies but mostly owners to sellers directly. Was it worst? I am not sure!
              I am working as an independant real estate consultant for the Aveiro, Espinho, Porto areas. What do I do! I spend the time people won't have to look for all the potential right properties what could interest them. I visit them, take pictures....Then I make a report for each of them, a selection of the best offers, present the folder to the potential buyer. They are so many things on sales that only with lot's of time and some knowledge you can find the best deals. As an agent working for one agency you tend to sale what you have......As I don't have anything I look for the market offers. And by the way here in Portugal the buyer don't pay a fee it's the seller. ( In fact the fee in included in the deals price ). So the deals could be with the A agency or B, or even directly with the owner.

              The only advice I would like to give you is not to rush....NEVER. To visit as many things as you can or GET someone to do it for you. And when you are starting to like a place get some other opinions ( from friends, from other people), negociate, right time to negociate the market in on a buyer dominant position.

              I don't have many years of experience in real estate but when I see what some people do ( agent or buyers ) I smile just because crying is not for me. Giving me prices 20% higher than the market and looking me in the eyes and saying it's a good deal. Telling me that the flat is beautiful when we are at the agency and then once we get in the building they put the keys in the wrong door on the wrong level because they have never been there. At least you relax and laugh quit a bit, that's always good.

              I hope I help you guys a bit, in anycase, enjoy this beautiful country.

              Take care.

              Sebastien

              If you need anyhelp contact me.

              Comment


              • #8
                My advice is only use a registered Estate Agent,

                look for the AMI number, if someone advertising property is illegal or not registered they wont have an AMI number. also check out the INCI website.
                Do your reaserch and use reputable legal Estate Agency companies and you should have no problems.
                www.gekkoportugal.com
                A guide to buying property in Portugal
                www.chavetejo.com
                INCI Estate Agents, AMI 7856

                Comment


                • #9
                  Prices of properties in Portugal

                  [FONT='Calibri','sans-serif'][FONT='Calibri','sans-serif']
                  Virtually all listed house prices on certified INCI & APEMIP Portuguese Estate Agents are "Asking Prices", meaning they simply represent the total price the owner(s) of the property would like to get paid for it. Official Portuguese Estate Agents are allowed, by law, to charge their commissions via two different ways:

                  a) A percentage of the total and actual sales price of the property. In Central Portugal this percentage varies from 2% (for an exclusivity contract, meaning the owners only advertise their property with one estate agency) to a maximum of 4% where the owners have chosen to go multi-agency (i.e., no estate agency has exclusivity on the selling of that specific property);

                  b) The owner(s) decide they want a "x" amount as minimum and the estate agent increases the property price so that he/she has some margin for negotiations with the possible buyers and still get paid for his/her work as mediator. In some European countries this is illegal, but not in Portugal. The "bad" news about this possibility is that, many Northern-European so-called estate agents operating by Internet in Central Portugal have made small fortunes by doing practices like this. The example given many times is the old Portuguese lady, illiterate, in her 70's, that wants to sell her lovely old stone house for EUR 25,000.00 and the estate agent actually manages to sell it for EUR 75,000.00, meaning he or she can actually put EUR 50,000.00 into his or her pockets. Practices like these also inflate the actual property prices and we come across many of these situations all over Portugal.

                  In the example given by user "jonwr":
                  I believe that in these cases the seller will get the same price regardless of what the buyer pays, the advertiser will get their commission around 2%, nothing wrong with that, the agent will get his 5% plus the bonus of 10,000 euros extra, the poor buyer gets stiched right up!! this practice is not right and these agents that regularly do this should be exposed, how do they sleep at night, when they openly overcharge people like this.
                  The way that I see it, it all depends on the contract celebrated between the seller and the Portuguese estate agent, as the following aspects will always need to be observed:
                  a) Listed prices are virtually always "Asking Prices";
                  b) On a typical property listed by a Portuguese estate agent for sale for EUR 100,000.00 it's usual that the buyer gets it for less than EUR 80,000.00, so I would say that properties around EUR 100K to EUR 200K can easily be bought for at least 20% to 25% less of the listed "Asking Price";
                  c) If the seller has chosen for an exclusivity contract with the estate agent, he or she will pay the mediator the percentage agreed, whatever the estate agent has sold his or her property via a PT, NL, BE or UK advertising website;
                  d) If we are talking about non-exclusivity and multi-agency, normally the seller pays a higher commission to the mediator (as described above), but again, whatever the estate agent has sold his or her property via a PT, NL, BE or UK advertising website, the "mediator costs" will always be paid to the Portuguese estate agent. It is then the Portuguese estate agent (or "mediator") that pays whatever advertising fees need to be paid.

                  Conclusion:
                  If a Portuguese estate agent has a property listed on its website for EUR 50,000.00 and the same property is advertised for EUR 60,000.00 on a different PT, NL, BE or UK advertising website it does not mean that "poor buyer gets stiched right up" as interpreted by user "jonwr". The reason being mainly that the property will eventually be purchased for EUR 40,000.00 (or less) and whatever commissions and/or mediator and/or advertising costs associated to that sale will always be shared pro-rata between all the interested parties.

                  I hope this explanation is useful to the people reading all these different comments.

                  It's always important to give time to improve ourselves that we have no time to criticise others.
                  [/FONT]
                  [/FONT]

                  Comment


                  • #10
                    I'm sorry remt - charging 20% extra on top as a sales "fee" is clearly not in the interests of the buyers or sellers, and as above, even monetary issues aside, the buyer protection issues appear not to have been addressed in your post.

                    Comment


                    • #11
                      Speaking as an INCI licensed Estate Agent working in Central Portugal, I have to agree with Brian, any pricing over the true market value of a property is a bad thing for everyone, a fixed % commission payable only on a successful sale is the best way to go.

                      Agents that regularly increase the price of a property are not working in the best way and dont have the best interests of the seller at heart.
                      An exclusivity contract is not in the best interest of the buyer or the seller, most companies trying to tie in customers to a exclusivity contract, charge around 5% in my experiance.

                      also i can not agree with your Conclusion,
                      any advertised price that is over the price agreed with the seller and the official agent, on the contract is not fair on unsuspecting house hunters. regardless of what figure the property will eventually be purchased at.

                      In my experiance agents (illegal or otherwise) that overprice property, then expect the price to be haggled down are not working correctly, they should value the property correctly and tell the owner why they have arived at that value, not just agree to what price the owner wants, then add extra money on top for haggling and commission!!



                      www.gekkoportugal.com
                      A guide to buying property in Portugal
                      www.chavetejo.com
                      INCI Estate Agents, AMI 7856

                      Comment

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