Sunday, February 28, 2010

Property finders not always independent......

In a revealing article in Britain's Daily Telegraph, many of the country's largest estate agents are creating susidiary firms which act as property searchers, or 'buying agents', and which charge a fee and 'act independently for the buyer'. Among the firms cited are Private Property Search (Strutt & Parker), The Buying Solution (Knight Frank) and Prime Purchase (Savills).

Search fees can be as high as one or two percent of the property purchase price, usually with a minimum payment, in addition to any commission charged by the estate agency handling the transaction.

Among the advantages claimed by property searchers featured in the article were their in-depth knowledge of the local market, prices and property values - all of which, some commentators argue, should be the stock-in-trade of a competent estate agent; and leading potential users of such services in Britain to question where precisely is the added value?

Buying property in a foreign country such as France is a different matter, due to the language and a different system of law. In France, the estate agency sector is rigorously controlled, with estate agents licensed by the regional Prefecture and governed by the Loi Hoguet of January 1970.

One of the weaknesses of the French system however is the widespread use of 'commercial agents' - self-employed individuals attached by contract to an estate agency, who rely in turn for their legitimacy on the employing agency's licence and through which they obtain their personal 'carte professionnelle'.

The system can be open to abuse when an 'agent commercial' operates independently - as a property searcher or negotiator - and may have only a tenuous link with the employing estate agency, which could be one licensed in another D├ępartement. Some national networks rely on this method of working, and the estate agency professional body FNAIM have been critical of the system.

The status of property searchers working in France was clarified by a ministerial reply of 12 August 2008, which stated that an independent property searcher can legitimately act on behalf of a client, outside the provisions of the Loi Hoguet, provided he was paid a fee by the client and did not rely on a commission from the sale of a property (Journal Officiel Q. 20525, p. 6987).

This is the position adopted by my firm, and enables us to remain completely independent, when advising our clients on all aspects of living, working and buying property in France.

Source: (UK) Christopher Middleton, Daily Telegraph 26 February 2010