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Asiahomes
Internet
22 Sep 2002
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Selling
bungalows to a sweet talking guy Saturday September 21 2002 was the mid-Autumn Moon
Cake Festival. Small children would be carrying lit
lanterns around the concrete jungle neighbourhood and
enjoy themselves. No more the real candles inside their
lanterns as these may burn the lanterns, but battery
operated lights. I was looking forward to the
celebrations but there was work to
do.
I had to arrange a meeting between a prospective seller
of a good class bungalow and a friend of a prospective
buyer who was in Australia. The prospective buyer had
viewed the bungalow with his friend who brought along a
woman.
I would call this friend of the prospective Buyer a
"master broker" as he would not give out his
name card but gave us the impression that he had various
global dealings and the woman was his personal assistant
whom he did not introduce initially.
We had coffee in the lounge of the Shangri-La Hotel. I
thought the meeting would last half a hour but it took
two hours. The Seller wanted $6.5 million. The master
broker gave various recent transactions such as the
American Embassy selling its Leedon bungalow at $400 per
sq. ft and offered $4.0 million for this 15,500 sq. ft
bungalow in a good class bungalow area where bungalows
must be at least 15,000 sq. ft in land area.
The desktop valuations ranged from $4 million to $6.5
million from 4 valuers of a foreign bank, I said to the
prospective buyer. It was hard to believe that a good
class bungalow in a good area could be valued at for $4
million. No formal valuations were done as the fees
would range from $800 to $2,000 with a graduated scale
of fee increase. In any case, I told my client,
the Buyer would not bother with valuations in this
recession.
"It could be mortgagee sales," the master
broker refered to the $4 million bungalows he quoted
when he faced resistance from my Buyer. "I don't
trust valuers. I use only the big ones.
What's your reasonable selling price?"
My Seller wanted to go home since the gap of $2.5
million between $6.5 m offer and $4m was too wide. He
was clearly unhappy that I had arranged this meeting at
the last minute and he had to cancel his prior
appointments.
The master broker was the one who only had this time to
meet and hence this was last minute. He said that
I had not told him that the selling price of $6.5
million. The Seller said that I did not tell him that
the offer was $4 million, otherwise he would not waste
his time attending this meeting. There was no
point rebutting both parties. I needed both to meet to
assess each other in this
situation.
"I don't want to press down your price, but the U.S
will start to invade Iraq and get rid of President
Saddam," the master broker said. "Property
prices will definitely fall soon after the war has
started."
He looked at me for confirmation and continued:
"The Singapore Government has abolished stamp
duties on the purchase of properties and that means the
market is in the doldrums."
My Buyer was uninterested in politics, valuations, past
sales transactions and wars. The master broker kept him
by being an excellent chatterer adn at the same time
assessing the prospective Seller's background and
desperation to sell.
"It must be a win-win situation for all, including
your agent who will be covered by me." he said.
"What's your net selling price?" he asked.
Obviously, $6.5 million was not appropriate today.
This was a mistake as he implied that he would pay me a
secret commission on success and there was no such
arrangement. I stared at him. He corrected himself,
"I can give your agent my bungalow to
sell." Obviously he must have remembered his
real estate lessons on "secret commissions" as
I assessed him to be an experienced ex-realtor employed
previously by one of the big boys.
"We can still be friends and do business, even if
we don't close," he said. "Give me your
telephone number," he asked the Buyer. Now, he had
the direct contact number. That was really no use me as
an agent now.
This is the greatest danger of introducing your
prospective Seller to a master broker who probably was
an ex-realtor, to discuss the deal.
Many of the high powered, high drive and successful
brokers do not bother with agents. They want deals
closed fast and the best way is to deal directly with
your client. Your client will think less of you when
they get irritated or pestered.
In the above case, the prospective Buyer had offered $4
million and I had really ignored him. But then, Buyers
will want to buy low and Seller want to sell high. This
is a common trait all over the world and in a recession,
the Seller must be firm. I had to terminate the meeting
to give the Seller time to think and to find other
Buyers. My problem was that I could not advertise the
property for sale and so this master broker was the
first and only one to view the bungalow.
Now, how do I get more qualified buyers without
advertisement?
There is another situation as a first-time agent to be
careful.
Ethics. Sadly, there seems to be no ethics in the
"me generation" of Singapore realtors unlike
the older ones. Do not give the contact numbers of
your clients when you co-broke with some of the most
aggressive co-broking agents. They have no qualms to
contact directly your client and make arrangements to
close the case without informing you!
There was one co-broking agent who even run me down in
front of her Landlord, for not lifting a finger to close
the case since she had stamped the tenancy agreements
and other documents and told my client about handing
over dates. She did not tell me about the handing over
and did not return my call regarding this. She was
the one who offered to get the documents stamped to
close the case fast before she went overseas.
It is best to get your client's paperwork done by you as
an agent and not trust co-broking agents who are pushy.
Their disdain of you and harm to your reputation are
like radiation. Deadly but invisible.
