Centurion Property Questions

Hi, ProKid

Here are some answers:

1. Real estate agents can ask a commission ranging between nothing and infinity. Since the Competition Commission found the one of the real estate associations guilty of "price fixing", no-one has been brave enough even to suggest a "guideline" for real estate agency commissions.

This means that you will have to negotiate the commission with the particular agent. If your sale will be an "easy" sale in the mind of the agent, you might be able to negotiate a very favourable rate. But if you are not clued up, you could end up paying your agent far more than you had in mind.

Some agents still say that commissions are "standard" fees or percentages. But the reality is that there is no standard. Commissions are up for negotiation.

Make sure that your asking price is realistic. Make sure that your property is in a marketable condition (looks good from the cerb and does not scare buyers away on the inside) and you could get an agent to agree to a lower commission than they usually charge.

The commission is included in the price that gets advertised. In other words, the commission gets deducted from the selling price. The buyer does not have to know how much commission is being paid, because it is a matter between you and your agent, however, most contracts of sale stipulate the amount of commission, because this information has to be passed on to SARS.

2. If you decide to sell privately and you ask the question "what do I need to know", then this sale is probably not one that you should handle all by yourself. You need to be properly prepared for selling privately BEFORE you need to sell. There are some decent articles available on the net (some gems here, IMO). But that would just be a starter.

You would need some backup. You know, a "posse"/"gang"/"team". And the first gangmember to recruit would be a good, helpful transferring attorney. Your own attorney is a MUST when selling privately.

Oh, and just so you know, selling real estate privately is not for sissies. But if you are informed and tough enough to handle all the funky people you will encounter during the sales process, then go for it! The rewards can be substantial.

3. The bank want to penalise you because they feel they haven't made enough money off your mortgage yet. Once again, you will have to negotiate your way out of a big penalty here.

Are you going to buy another building? Then how about trying to convince the bank that they will make heaps more money off your new mortgage? If your negotiations are not successful, you will have to decide if it is still worth selling if you lose that penalty fee. If not, stick it out a couple of years more.

The correct procedure in selling is to find a buyer, reduce the sales agreement to writing, take the contract to your attorney (if the attorney did not help you to get the contract signed), and then wait a while for your money to come. Simple, hey?

Well the actual process is a little more complicated, but that is the gist of it. The hard part is finding your buyer. Your attorney gang buddy will contact the mortgagor and all the other folks that need to move to get the sale finalised. The attorney will call on you to sign some papers and hey presto - the sale is final. (Er, that is if there are no hickups along the way.)

I hope these answers help some? Good luck. And let the rest of us know about your experience? I'd love to hear how things develop!