# Estate Agent Fees (Valencia)



## Chancerz (Feb 12, 2017)

Hi,

I hope you're all well.

We're looking at the prospect of buying a house in Valencia. After speaking to a few agents and looking at purchase costs I noticed that quite a few agents charge the buyer a 3% purchase fee (agency fee). I'm assuming they also charge the seller a fee too!

I've never heard of this, it seems like a double pay day for the agent. 

Has anyone else come across this? is this normal or am i having my pants pulled down because i'm an expat?

I know everything is negotiable but thought i'd seek some pearls of wisdom from you trusted folk.

Thanks


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## Relyat (Sep 29, 2013)

Some do charge both, others don't.
My advice, only use an agent that charges only the seller. There are enough of them out there and enough share the same dwellings for sale.


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## Chancerz (Feb 12, 2017)

For sure, I wasn't intending to pay the buyer fees, it seems ludicrous. I also heard that they require a document to be signed before a viewing stating that you agree to their terms (fees) etc... I'll check this before I arrange any viewings.

I was keen to find out whether anyone here had come across the agency fee for buyers when they purchased a property and how / if they managed to get around it?


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## kalohi (May 6, 2012)

Chancerz said:


> For sure, I wasn't intending to pay the buyer fees, it seems ludicrous. I also heard that they require a document to be signed before a viewing stating that you agree to their terms (fees) etc... I'll check this before I arrange any viewings.
> 
> I was keen to find out whether anyone here had come across the agency fee for buyers when they purchased a property and how / if they managed to get around it?


Around here it is included in the announced sale price. Who pays it depends on how you interpret the situation. It's money that the seller pays the agency from the sale price, or it's money that the buyer pays but that isn't reflected in the new deeds. Either way the estate agency gets their money. Three to five percent is about standard. 

FYI, for fiscal purposes the fee is considered to be paid by the buyer. 

We bought a house 18 months ago, and when we had a viewing organized by an agency we always had to sign an exclusivity agreement. That's so that buyers don't use an agency to find them a house and then turn around and make a deal privately with the seller.

When we were house hunting we mainly used internet sites to find properties we were interested in and that were being sold privately. We did see a few houses being sold through an agency, but in the end the house we bought was a private sale. It saved us a bunch of money!


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## The Skipper (Nov 26, 2014)

Chancerz said:


> Hi,
> 
> I hope you're all well.
> 
> ...


We came across this back in 2007 when we were looking for a house in Alicante province. We refused to view with agents who were charging commission to buyers and simply arranged appointments with rival agents who were marketing the same properties. All properties back then appeared to be listed with multiple agencies and at varying asking prices as well as differing business terms. Shop around!


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## kalohi (May 6, 2012)

snikpoh said:


> Are you sure that's what you mean? Surely the seller should be charged


Eighteen months ago when we sold our house (through an agent) they added their fee to the _sale_ price. So the buyer paid it and it went straight to the agent. We never touched that money, so it was never ours and never became part of our capital gains. 

Of course it was that much less money that we took in from the sale...so you could interpret it as us paying the agent.


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## Chancerz (Feb 12, 2017)

Thank you all for the replies.

Firstly, I think 3% is an extortionate amount to pay whether you are the buyer or the seller. These day's an agents work is usually very reactive (they post the property on the net and wait for the calls to roll in)...

Also, the agent represents the vendor who is their client. From my understanding the vendor can offset the agent fees from CGT so technically they get their money back. Can the buyer do this when they sell the property 10 years down the line for buying and selling? Not sure at this stage (meeting a tax advisor next week).

Agree with skipper - One of of the properties I'm looking at is listed with a different agent for €12k cheaper!

And.. I wont be signing any exclusivity agreement!


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## Chancerz (Feb 12, 2017)

kalohi said:


> Eighteen months ago when we sold our house (through an agent) they added their fee to the _sale_ price. So the buyer paid it and it went straight to the agent. We never touched that money, so it was never ours and never became part of our capital gains.
> 
> Of course it was that much less money that we took in from the sale...so you could interpret it as us paying the agent.



So this is the normal process as per my understanding. The seller agrees a percentage of the sale price with the vendor. this then incentivises them to get the max they can possibly get for their client. Why should they then be paid by the buyer? Sounds like racket to me


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## Relyat (Sep 29, 2013)

At the end of the day the money that the agent receives comes from the buyer - whether paid to them by the buyer, seller or combination of both.
We are used to the seller only paying the agent as that is the custom in the UK.
If you must, as a buyer, use an agent that will charge you then factor that in when considering the price you will pay together with the other costs. Again, I don't think that there is any need.
I sold last year through an agent who charged 4% with no charge to the buyer. I thought that what I paid was steep compared to the UK, but not here.


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## Chancerz (Feb 12, 2017)

Relyat said:


> At the end of the day the money that the agent receives comes from the buyer - whether paid to them by the buyer, seller or combination of both.
> We are used to the seller only paying the agent as that is the custom in the UK.
> If you must, as a buyer, use an agent that will charge you then factor that in when considering the price you will pay together with the other costs. Again, I don't think that there is any need.
> I sold last year through an agent who charged 4% with no charge to the buyer. I thought that what I paid was steep compared to the UK, but not here.


I agree 4% is very steep!

Technically what you are saying is correct, the money ultimately comes from the buyer. However the seller still has to pay the agent from their profits of the sale. Bearing in mind the final sale price is often lower than the asking price. Therefore eating into their potential profits. Agents are known for over inflating what they think a house is worth in order to retain the vendor and then a few months later advising the vendor to lower the asking price due to lack of interest.

I also agree with your point of adjusting my offer based on their fees. However, this also has it's problems. I could potentially have put in a higher offer if I didn't incur the agency fee which means the vendor makes more money. Plus my lower offer due to agency fees may not be acceptable to the vendor which means I could lose the property I want. Ultimately it effects my purchasing power.

There seems like there is no incentive for the agent to try and get the max asking price for their client - the vendor.

By technically charging both parties, the agent makes between 6-8% per property sale. To put that into perspective on a €300k property they would be earning between €18-€24k!!!!  - Seems like the agents are being a tad greedy... 

I think I'm in the wrong business


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## kalohi (May 6, 2012)

Chancerz said:


> So this is the normal process as per my understanding. The seller agrees a percentage of the sale price with the vendor. this then incentivises them to get the max they can possibly get for their client. Why should they then be paid by the buyer? Sounds like racket to me


No, that's not how it worked when we sold. Before we signed on with an agent, the agent clearly stated what % they would take as a fee. (Take it or leave it - non negotiable, by the way. If you don't like it go to a different agency.) They added that amount to our asking price, and the house was sold at that higher price. The buyer paid that higher price and that's all. 

So if a hypothetical house is sold for 100,000€ and the agent fee is 5%, the buyer would pay 100,00€, the seller would receive 95,000€ and the agent would get 5,000€. The buyer doesn't pay another agent fee beyond that. 

I totally agree that the percentage the agencies charge is outrageous, especially for the little work that they do. But in our case, with everyone in our house working, we had no time for advertising, taking calls, showing...


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## michaelbr51 (Mar 12, 2016)

As far as I know, each province has its own rule, when I lived in Barcelona, the agent charge only the seller, but here in Valencia, they charge both sides, I was told that in Spain only three cities (? I'm not sure if city or province) charges both sides. Normally you can negotiate the fee, but nowadays, it's hard due to the price bubble. But in the end, it seems the same to me, the seller will want his price and the agent add his/hers fees on top of it.


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## Lynn R (Feb 21, 2014)

There is one nationwide estate agent chain (a franchise operation, I think) which is notorious for charging commission to both the vendor and the buyer - Tecnocasa. There are umpteen complaints online about them.

https://www.idealista.com/news/foro/compra-venta/743666-tecnocasa-comisiones


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## Megsmum (Sep 9, 2012)

When we first looked in Andalusia, some agents we used made us sign paperwork before showing us a property stating the 3% charge. Others had a 3% commission in their paperwork. 

The agent we bought from here in extremadura had no buyers fees.


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## Barriej (Jul 23, 2012)

Maybe I can add some current info to this.
We have just returned after visiting family and viewing properties in the Alicante area (La Nucia to Albir etc).

And none of the agents we contacted charge buyers. I asked everyone and was informed that it was the sellers responsibility to cover the agents fees.

Now of course if it were me I would add that to the asking price if I were the seller.
And as a buyer I would always try for a reduction in price.

None of them asked that we sign any agreements before viewing. 

The 3% that has been mentioned that is kept back is to do with another form of tax when you sell. It is held by the buyers lawyers and paid as a gains tax by the seller.

We looked at quite a few properties during the week and some sellers are still trying to be greedy (although these seemed to be the Brits leaving to go home). However I will say that prices in the area we looked in, are now starting to rise and most agents are quite busy.

In the end we settled on a nice 3 bed 2 bath apartment in the quiet village of Xirles near Polop. We managed to negotiate about 5% off the price but it was already at a good price. There was another apartment of the same style round the corner priced at €12000 more.

I would say it's still a buyers market in some parts of the Costa Blanca but I don't think is going to last much longer.


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## Chancerz (Feb 12, 2017)

So the agent wouldn't show me around unless I agreed to their fees!

Their justification for the fee is that they work for both the buyer and the seller! What a load of tosh!!!

How can you work for both sides? I'm sure that's called "conflict of interest"

I can't think of any other industry where this happens.. A solicitor cant represent the defendant and the prosecution...


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## kalohi (May 6, 2012)

If you want to buy a property in Spain, my recommendation is that you accept the situation for what it is, and move on from there. You aren't going to be able to change the system.

If the situation is too intolerable for you, then maybe this isn't the country where you should be buying.


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## baldilocks (Mar 7, 2010)

Chancerz said:


> So the agent wouldn't show me around unless I agreed to their fees!
> 
> Their justification for the fee is that they work for both the buyer and the seller! What a load of tosh!!!
> 
> ...


Go to another agent which will probably have many of the same properties.


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## Chancerz (Feb 12, 2017)

Agreed, most properties are on with numerous agents. One of the properties I was interested in is being advertised by another agent for €12k lees (the equivalent of the agency fee with the other agent)!

I just wanted to know if the practice of charging the buyer was normal or if i was being treated differently because i'm an expat.

My conclusion is that I have 4 options

1. Accept the fee and account for it in my offer which decreases my budget
2. Negotiate the fee down with the agent
3. Buy through an agent who doesn't charge the buyer a fee
4. Approach vendors directly


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## Lynn R (Feb 21, 2014)

Chancerz said:


> Agreed, most properties are on with numerous agents. One of the properties I was interested in is being advertised by another agent for €12k lees (the equivalent of the agency fee with the other agent)!
> 
> I just wanted to know if the practice of charging the buyer was normal or if i was being treated differently because i'm an expat.
> 
> ...


No, you are not being treated differently because you are foreigner. If you look at the comments in the link I posted about Tecnocasa (a nationwide chain which does charge commission to both buyer and seller), they are all from Spanish people. Some agencies do this, some do not. I have bought two properties here and neither agent charged me commission as the buyer. The agent I used for my latest home, last year, did require me to sign an agreement stating that I had viewed the property with him, though. He was the only agent the property was listed with, and I was anxious to secure it. If the ones you are interested in are listed with several agents, then simply go through the ones which don't charge you commission as a buyer.

You say approach vendors directly may be one option. Before buying my current home I attempted to buy another property as a private sale. All seemed to be going well until the day before I was due to sign the compraventa (with completion to follow very soon and being a cash buyer, and the property had been on the market for 3 years) when the vendor suddenly announced that she wanted nothing further to do with either me or my lawyer (apparently because she wanted to draw up the contract herself instead of my lawyer doing it). I had to pay my lawyer for the work she had already done. So private sales can be not without problems, either.

If you start out with the attitude in Spain that everyone is out to fleece you because you are a foreigner, your life will not be a happy one. As kalohi said, maybe Spain is not the country for you.


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## Chancerz (Feb 12, 2017)

Lynn R said:


> No, you are not being treated differently because you are foreigner. If you look at the comments in the link I posted about Tecnocasa (a nationwide chain which does charge commission to both buyer and seller), they are all from Spanish people. Some agencies do this, some do not. I have bought two properties here and neither agent charged me commission as the buyer. The agent I used for my latest home, last year, did require me to sign an agreement stating that I had viewed the property with him, though. He was the only agent the property was listed with, and I was anxious to secure it. If the ones you are interested in are listed with several agents, then simply go through the ones which don't charge you commission as a buyer.
> 
> You say approach vendors directly may be one option. Before buying my current home I attempted to buy another property as a private sale. All seemed to be going well until the day before I was due to sign the compraventa (with completion to follow very soon and being a cash buyer, and the property had been on the market for 3 years) when the vendor suddenly announced that she wanted nothing further to do with either me or my lawyer (apparently because she wanted to draw up the contract herself instead of my lawyer doing it). I had to pay my lawyer for the work she had already done. So private sales can be not without problems, either.
> 
> If you start out with the attitude in Spain that everyone is out to fleece you because you are a foreigner, your life will not be a happy one. As kalohi said, maybe Spain is not the country for you.


I did read the link you sent (thank you).. A lot of very pee'd off Spaniards.

Also thanks for the info regarding buying direct.

I don't think everyone is out to fleece me at all. I'm just being cautious and "street wise" as to what is normal. I also think it's important to question everything and learn rather than just accepting things and rolling over without further investigation (which is part of the fun). Unfortunately everywhere in the world there are unscrupulous people and companies who try and exploit, shall we say, "the less informed". I'm new here and loving it but at the same token I'm not someone who is going to get mugged off whether that's here or anywhere else in the world.


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## SandraP (Apr 23, 2014)

We have recently purchased a property in Spain. We paid half the agents fees, seller paid half. The house was only on with one agent and was the only property we both fell in love with. We accepted the fees when we first went to view houses with the agent and that, the 10% tax we had to pay, the notary's fees and the lawyer's fees were part of the purchasing fees. I never felt we were ripped off in anyway, shape or form and were not treated any different because we are foreigners.
One estate agent asked us to sign a form and wanted to charge us 6000€ regardless of the property price. Needless to say we never went to see properties with that one.


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## samthemainman (Aug 15, 2012)

I had mixed (but mostly poor) experiences with estate agents in Valencia city. Fees were largely extortionate and the conflict of interest of joint commission with most of them made it difficult to believe you were ever getting the best deal. All of them seemed too keen on Dinero B (under table money to illegally reduce tax/capital gains burdens for both buyer/seller - although this kind of arrangement is allegedly the ‘norm’) and few of them were competent at their profession - e.g. leaving key information on specs at the office, not knowing the reason for sale, not knowing community fee amounts, etc. I am sure there are many many excellent ones out there - we just never found any for the properties we were interested in.

If at all possible I recommend buying direct from the seller and just get a good solicitor which will usually cost no more than 800-1000 Euros depending on how straightforward it is. Some properties the seller may have an exclusivity agreement with the agent, but if not and you see a property on the market you like, and try to contact the seller direct - note in the mail, ring the doorbell etc. Otherwise by signing a document at first viewing you could get lumbered with a bill for thousands just for them bringing the keys round and sorting out paperwork/arras contracts. Not good value especially when you normally have property taxes on top of the sale which will need paying.

And never fall into the trap of paying under the table money as it’s not only an illegal vicious circle of repeatedly under-declaring the sale price every time the property is sold, but the authorities are now clamping down on purchases sold for what appears to be drastically below its real value.

Good luck though - Valencia is a great city which has got much better in recent years. I’ve been here since 2012 and no looking back!


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## baldilocks (Mar 7, 2010)

As Sam says, avoid the brown envelope route because it may be that YOU are the one when the true value has to be declared and YOU will be the one who has to pay tax on all those brown envelope amounts that went on before - that happened to a two Brit couples here in this village..


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## Chancerz (Feb 12, 2017)

samthemainman said:


> I had mixed (but mostly poor) experiences with estate agents in Valencia city. Fees were largely extortionate and the conflict of interest of joint commission with most of them made it difficult to believe you were ever getting the best deal. All of them seemed too keen on Dinero B (under table money to illegally reduce tax/capital gains burdens for both buyer/seller - although this kind of arrangement is allegedly the ‘norm’) and few of them were competent at their profession - e.g. leaving key information on specs at the office, not knowing the reason for sale, not knowing community fee amounts, etc. I am sure there are many many excellent ones out there - we just never found any for the properties we were interested in.
> 
> If at all possible I recommend buying direct from the seller and just get a good solicitor which will usually cost no more than 800-1000 Euros depending on how straightforward it is. Some properties the seller may have an exclusivity agreement with the agent, but if not and you see a property on the market you like, and try to contact the seller direct - note in the mail, ring the doorbell etc. Otherwise by signing a document at first viewing you could get lumbered with a bill for thousands just for them bringing the keys round and sorting out paperwork/arras contracts. Not good value especially when you normally have property taxes on top of the sale which will need paying.
> 
> ...



Thanks Sam and Baldilocks - Sound advice. This is precisely the type of info I was looking for. 

I'm from a property background and am accustom to buying and selling in various countries, with each location having their own individual nuances. However I had never come across the practice of charging both sides or technically charging the buyer twice (if the agent had already agreed a price with the seller and marketed the property with the commission on top, then charged the buyer a further 3% of the final sale price). as all the money in the purchase comes from the buyer anyhow!

I'm meeting a couple of agents in a week, one of them I know and have a good relationship with, the other I've never met before. I will discuss the whole commission subject with them. I'm truly fascinated to hear how they justify it. At the very least it will be a good objection handling exercise for them. :fencing:

I will report my findings...

I agree Valencia is an amazing city, we have found the people to be super friendly and the vibe of the whole place is amazing hence why we want to put down roots. I can't see us going back to Brexit Britain...


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## baldilocks (Mar 7, 2010)

I think one of the ways the agents justify charging the buyer is, often, they will take prospective buyers around a number of properties which in more rural areas can mean driving considerable distances. The business of getting a viewer to sign a document tying the viewer into making a payment is to get something out of the viewer if she/he subsequently buys through another agent, having first viewed with the first agent, this is a consequence of not having sole agency agreements here.

There is no MLS system here which is not necessarily a bad thing. We had a property for sale in Florida and the realtor it was with did not follow up on referrals from other realtors to save splitting the commission - it took two years with no viewings before we found out what was happening - changed realtor and sold within two months.


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## Chancerz (Feb 12, 2017)

As promised I'm reporting back with my findings...

So, this phenomenon of charging the buyer only exists in very few regions in Spain (as some of you may already know). My personal view is that it has become "cultural" in Valencia because in my opinion agents have been able to get away with it! They can dress the buyers fee up and justify it however they want, but all the agents I spoke to could not challenge my objections and simply in the end said "that's how we do it here". I'd also like to add that most agents agreed with my points. They're on a win win scenario here!

What I have mentioned above, for me, personally, presents opportunity!

The agents I spoke to were however willing to negotiate on their fees which is important to note.

I would when the times comes approach owners directly (with a good solicitor in hand) and negotiate to buy. This would give me more buying power as I would have more money to spend by not paying agents fees. Or I could use the extra cash for improvements like a new kitchen etc...

I hope this helps


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## anna_knight (Feb 27, 2019)

I am moving to Valencia in September 2019 and currently looking for a place to stay too. I did some research about what the best option to buy with paying a mortgage or a long-term rent. Some websites claim that real estate agents charge only the seller. I found that the commissions for sellers are from 1.5% to 6%. Usually,the lower fees will be paid on more expensive property and new-build home rather than in stock market. Anyway, it is difficult to find a /SNIP/ property for sale in Valencia and make it your home, plus none wants to overpay to an agency.


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## snikpoh (Nov 19, 2007)

anna_knight said:


> I am moving to Valencia in September 2019 and currently looking for a place to stay too. I did some research about what the best option to buy with paying a mortgage or a long-term rent. Some websites claim that real estate agents charge only the seller. I found that the commissions for sellers are from 1.5% to 6%. Usually,the lower fees will be paid on more expensive property and new-build home rather than in stock market. Anyway, it is difficult to find a property for sale in Valencia and make it your home, plus none wants to overpay to an agency.


Why do you say it's hard to find somewhere - there are literally thousands to choose from.


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## xabiaxica (Jun 23, 2009)

snikpoh said:


> Why do you say it's hard to find somewhere - there are literally thousands to choose from.


Of course there are. The member even added a link to a property website.

And now that I've removed the link from the post, it's no longer an advert.


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## Barriej (Jul 23, 2012)

baldilocks said:


> As Sam says, avoid the brown envelope route because it may be that YOU are the one when the true value has to be declared and YOU will be the one who has to pay tax on all those brown envelope amounts that went on before - that happened to a two Brit couples here in this village..


And it's not just the 'brown envelope' that can catch you out.
We are most of the way through buying a flat and our lawyer has told us the catastral value of the property is higher than the agreed selling price.
The flats were built in 2005 before the crash and its at that value still. So we have about €1500 more to pay than I thought. 

So it pays to be careful with that 'bargain' that's now been reduced by thousands.


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## Lynn R (Feb 21, 2014)

Barriej said:


> And it's not just the 'brown envelope' that can catch you out.
> We are most of the way through buying a flat and our lawyer has told us the catastral value of the property is higher than the agreed selling price.
> The flats were built in 2005 before the crash and its at that value still. So we have about €1500 more to pay than I thought.
> 
> So it pays to be careful with that 'bargain' that's now been reduced by thousands.


This issue of "complementary transfer tax" is one which has often been warned about on the forum - most recently here:-

https://www.expatforum.com/expats/s...ng-spain/1472458-very-new-5.html#post14789768

At least your lawyer has done their job properly by alerting you to this before completion. Often buyers only find out about it when they receive a demand from AEAT for the additional tax, sometimes years after completion.


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## Chancerz (Feb 12, 2017)

Thanks for this, I didn't know about this tax!

So, even if you pick up a bargain you still have to pay tax on what the government deem the "true" value of the property to be! 

Interesting way of doing things but I guess they had to do something about people under selling their properties for tax purposes and the brown envelope brigade!


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## Barriej (Jul 23, 2012)

Chancerz said:


> Thanks for this, I didn't know about this tax!
> 
> So, even if you pick up a bargain you still have to pay tax on what the government deem the "true" value of the property to be!
> 
> Interesting way of doing things but I guess they had to do something about people under selling their properties for tax purposes and the brown envelope brigade!


Yep. But it's quite easy to find out. We are lucky, the lawyer we are using has answered all of our questions and volunteered information as well. I suppose it's because qwe have been visiting the area we are now buying in for the last 15years.

You can find out the declared value by either asking the agent (if they are good they will have no problem telling you) or make sure your lawyer finds out. But you can do it yourself as well. 

We were told we could appeal as the valuation was made on the flat when it was first built and had not been reappraised but the cost of doing so was almost as much as we may (will) have to pay. I suppose if you were buying a property for a million or so it might be worth it.


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## joannadawns (Nov 28, 2017)

*Fees*

We're looking at the Valencia area and most seem to charge buyers at least 3% + vat at 21% I'm trying to research a little more at how this affects the finished price. prices in the area look cheaper but this is the reason, so far I've not found any agents who don't charge the buyer ...


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## Relyat (Sep 29, 2013)

We sold through these

azaharproperties.com

They don't charge the buyer


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## Chancerz (Feb 12, 2017)

joannadawns said:


> We're looking at the Valencia area and most seem to charge buyers at least 3% + vat at 21% I'm trying to research a little more at how this affects the finished price. prices in the area look cheaper but this is the reason, so far I've not found any agents who don't charge the buyer ...


What you can do is either try and find the property yourself and approach the seller direct by knocking on the door etc.. 

Or, you could contact an agent that does not charge the buyer a fee (or twice depending on how you look at it) like the one mentioned above and ask them to approach the seller/seller's (if there are multiple properties you like) on your behalf. Most agents can get hold of any property for sale (a lot of properties are on with multiple agents anyway as the seller is keen to sell) unless the seller has an exclusivity agreement with a particular agent. Even with an exclusivity agreement your agent can find out how long they are tied in for and you can patiently wait until it's ended and buy through your agent that doesn't charge a fee! This can be risky though as you might lose the property you love so it's always worth finding out how long a property has been on the market for.

Another way of negotiating the buyer's fee down is by working exclusively with an agent on the premise that they will only charge you 1% or 2% (whatever you can negotiate really) and ask them to approach all the properties you like. Agents are happy to do this because it guarantees them a sale. Better to work like this with an agent that doesn't charge a fee at all.

Hope that helps


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