Overseas property - Be prepared
Many UK agents have worked in the overseas market without success – usually because they have failed to takes the steps outlined below
Let’s take a look at the key dos and don’ts of overseas property selling. Firstly, don’t offer thousands of properties for sale. It is impossible for you to check thousands of properties or handle enquiries with any degree of professionalism about such a big portfolio.
Keep the number of properties and the number of countries low enough to give your company a chance to know its product range.
Focus on selling properties offering the highest fee.
Typically, international agents have worked on the belief that 3% is a little low and 10% a little high though, of course, no agent is unhappy to accept the latter.
But sales and commission figures that sound good too often fail to deliver. That said, there is a caveat in the present market - developers are keen to move stock, so the property offering 10% commission may not be the bad bet it has been in the past.
It may sound obvious but never sell a property without checking it first.
You need to see proof of land ownership and proof of all planning permissions required, as well as building licences. Once you enter this market, you’re likely to get lots of properties pitched to you.
Draw up a list of questions about the developer and the development for all property, including all financial details and planning.
This is a good exercise for deciphering which developers are worth dealing with - unprofessional developers are unlikely to deal with an extensive list of questions because they know they can’t answer many of them; good developers will be happy to prove their credentials.
You must focus on potentially lucrative properties. This is not the time to make lots of overseas property partners.
Spend your time and whatever money you have on proactive partners with good products.
And, as well as commission rates, check payment times for each partner you plan to work with. In a tight market, cash is king. It’s no good making plenty of sales on a development when either you don’t get paid until the development is finished - a minimum of 18 months in most cases - or the developer is slow to pay its bills.
You want, at least, some of your commission paid when you sign contracts. With a lot of stock currently on the market, you are in a good position to push for early payment of commission before you agree to sell properties.
It is crucial to ensure you serve your clients well, from their initial enquiry through to the sale, just as you would with a UK property.
There are plenty of good agents and developers to work with who will take care of your clients. Unfortunately, there are also quite a few that will promise everything and deliver close to nothing on customer service, even if their developments are good. Build into your contract the working practices you operate and expect in return. If possible, ensure someone within your company is copied in on all correspondence between your client and your overseas partners.
There is money to be made on overseas property but there are traps you can easily fall into that will see you make no money at all and waste plenty of time. Do your homework thoroughly at the beginning of a sale - before you sign any partnership contracts - and be proactive in pushing a limited amount of product.
Stay on top of your leads and communicate with your clients about the progress of their deal every step of the way.
Then, ensure you are paid your commission on time.