You have come to seriously that the time has come to invest in real estate abroad. You have been to Phuket, and overall this place seems to you an excellent choice for making your first investment. You start to immerse yourself in the material, study tons of information, send requests, and then, from all sides, experts, consultants and specialists begin to surround you, who in different ways begin to persuade you to agree to their services. At some point, a whole legion becomes “willing to help”, and it is very difficult to choose one.
For the first time, we present a detailed analysis of the specialty of an agent, explaining their motivation and interest.
In this guide to agents, we will tell you who they are, how to choose and check an agent worthy of your trust, and what characteristics a real Phuket Property expert should have, who can be trusted with your funds.
Agents - who are they?
In order to sort out the information "mess" that has fallen on you, remove the echo of sweet promises and choose one person, you should first decide on the values.
"Real estate agent: a financially interested person (or organization) conducting consulting activities on providing information about real estate objects."
There are three main subtypes in the classification of real estate agents in Phuket:
- Real estate agent
- Real estate rental agent
- All-in-one agent
In our article, we focus exclusively on sales agents, because they are the ones who work in the high-risk large checks segment. We only note about the rest:
Rental Real estate agents are specialists representing the interests of homeowners, partners of hotel chains, resorts, villa complexes, management companies. The main vector of work of these agents is short-term and long-term rental housing in Phuket. Like everything in this guide to agents, they work solely on a commission basis, which, depending on the terms of the contract, is paid by either the landlord or the tenant.
All-in-one agents are a category of “specialists” that you should pay close attention to. It is agents of the “general profile” who most often become the heroes of news reports and angry posts on social networks. It is very easy to identify such an agent. As a rule, they are ready to provide you with all the services in Phuket: sell an apartment or a villa, rent a motorbike, car, yacht, plane, sell you latex, slimming tea from crickets, take you to the zoo and arrange a ladyboys show.
Naturally, a specialist providing the entire range of these services is simply not able to control the quality, range of choice and, most importantly, the adequacy of prices for these services. A good salesperson is simply not able to engage in operational activities (even in a delegation mode), because his main profile requires maximum concentration and responsibility.
Why do we need agents, isn't it better to buy directly?
Professional and responsible agents are definitely needed and helpful. A good realtor always gives the buyer a real picture of the market and helps to understand the specifics of a particular project. Developers are unlikely to be frank about the shortcomings of their products and to analyze in detail the features of competitors. Before the advent of the global Internet, agents were the only sales force, as many developers were unable to organize their marketing and generate a stream of customers. Now, at a time when essentially all information is in the public domain, agents have become valuable for their consulting expertise.
How to choose an agent you can trust?
The question of trust in the world of finance is ephemeral and conditional. Any slightest real trust is a long process, and based on real actions. Therefore, the process of choosing a realtor who will provide you with information and represent your interests in front of the developer can be compared to choosing a business partner, and choosing one, first of all, you need to check it. In this regard, the answer to the question “HOW” is multi-layered and contains several essential elements, neglect of any of which carries additional risks.
This stage will actually cut off most of the applicants for your trust, relieve you of unnecessary headaches and obsessive attention. The first criterion to find out is to check the legality of the agent's work. What is needed for this?
Ask the agent for the registration document of his legal entity. In Thailand, this form is called the DBD (Department of Business Development Form). A small embarrassment is the fact that the form is exclusively in Thai and has a limited duration. This is because the company is obliged to update this document every 6 months from the date of registration by submitting financial statements and paying tax fees. To make it easier for you, in the photo below we have indicated which key data from the form should be used for verification.
Remember: Buddhist calendar in Thailand is different from Gregorian, and for example 2021 in Thailand is 2564.
After the agent has sent you a document for verification, feel free to go to the DBD website in order to receive complete information about the company in English.
Follow the link to do the following:
- Enter spam captcha
- Enter registration number
- Click on search
- Click on the number of the company that appears
As a result, you get the following data
- Legal entity form (Company Limited)
- Legal status (Still Operated)
- Date of creation
- Authorized capital
- Filed reports by years
- Legal address
- List of directors
- The right to sign and seal
- Type of activity at the time of registration
- Purpose of registration
- Activity at the time of the last reporting
Based on the data obtained, you can get a clear picture of the activities of a legal entity and its compliance with the type of activity.
The next step in the initial check is to request a Work Permit. This document should be with anyone and specialists with whom you are negotiating, whether it is the owner of the company (the person indicated as a director), or an employee of the agency. Like all official documents in Thailand, Work Permit is also issued in Thai, with the exception of the indication of the name of the foreign worker, and the territorial point, which are indicated in English.
In the photo of the work permit, we marked the most important point, which you can translate using your smartphone camera and the Google Translate application. This column should indicate the position of the employee.
For example: international clients manager
Another important condition is the mark on the extension of the work permit, and in fact confirming its validity. Renewal information is on the penultimate spread of the document. And if the document (as in the photo above) has a past date, deferentially ask for a renewal stamp (see photo below).
Why is this so important?
Full legality in Thailand is a very time consuming and costly process. Only specialists who are able to work for self-sufficiency and income can afford the maintenance of an accountant, payment of annual visa fees and renewal of Work Permit.
So, the initial check has been passed, and the first light of trust flickered in your hearts. Take your time, with this step we have only cut off completely undesirable elements, and there is still a lot of work ahead.
If with the initial check everything is crystal clear and understandable in principle, then in identifying the professional suitability of an agent everything is a little more difficult. As a rule, at the first stage of negotiations, while you have not yet pissed off the agent with your suspicion, almost all of them behave very tactfully and intelligently. They throw in terms, juggle with sonorous Thai place names and completely demonstrate that "they are in the subject."
In order to structure the script for analyzing professional suitability and identifying that very one and only agent, we will distribute classic cases of conversations with buyers with agents on the principle of “rogue” and “pro”.
Let's try to ask the agent a series of simple tasks (real button accordions from real estate) and see how professionals and crooks cope with them. As a developer company, we constantly participate in trilateral negotiations "buyer-agent-developer" and give real cases of negotiations from our own practice.
What about Thailand's economy?
“Rogue”: Will begin to talk about the fact that the Kingdom is recording growth exponentially from year to year, there will be a second Singapore, and all investors in the world wake up every morning with an irrepressible desire to buy everything here.
“Pro”: Will start her answer with exact data and numbers, and will explain: which spheres are growing, which are falling, what action plan does the government have, where “bubbles” are possible, and will reasonably explain its position on the advisability of investments.
Why buy real estate here, because all the land belongs to the Goverment?
“Rogueа”: Will break into emotions, begins to hotly admonish that this is a blatant lie and provocation of Turkish realtors, and that every Thai will gladly sell the last piece of land to a foreign moneybag.
“Pro”: In simple and understandable words, he will explain the basic laws of the Land Code of the Kingdom of Thailand, the principles of the formation of private property rights and smoothly reduce everything to the peculiarities of land ownership for foreigners, and the form of full ownership in accordance with the 1979 condominium law, with all its amendments.
How much will my property become more expensive during construction?
“Rogue”: Will tells about fabulous growth, monthly rise in price, extreme demand and the ability to quickly resell an apartment or villa immediately after the completion of construction.
“Pro”: Will tell in detail what makes up the cost of a project, explain the key points about the prospects of the location and the possible activities of future competitors.
Using these three simple examples, it is easy to understand the general vector of checking the agent's awareness of general economic issues and the depth of his knowledge of the market directly in Phuket.
Pay attention to tone, confidence, and literacy. Until recently, some of the agency fraternity in Phuket was represented by a cohort of people who were clearly stuck in the 90s, using the appropriate vocabulary and approaches. It is quite reasonable to isolate oneself from this category, as well as from the doubting, mumbled and obviously unsure of their correctness “specialists”.
An agent worthy of attention always appeals with numbers and facts that are easily googled and can be used in fact-checking. He always argues his position, gives cases from practice, and never tries to put pressure on you. He is neatly dressed, has a positive attitude, and is ready to provide you with as much information as possible with an answer to virtually any question.
In addition to superficially misleading the buyer, sometimes agents also suffer direct financial damage, driving the client into debt to the developer. During the recent construction boom, pseudo-experts (and in this case, actually swindlers) implemented the following scheme:
The buyer was offered to purchase two instead of one apartment at the stage of construction. The agent promised on oath that at the stage of construction the apartments will rise in price by at least 30-40% and by crossing one of the apartments it will be possible to close the debt for the first one. Satisfied with the profitable scheme, the buyer made an initial payment of 30%, and the agent, rubbing his hands, received two commissions instead of one.
After it turned out that the apartments had not risen in price, and the developer himself was selling the remaining at a good discount, and the time had come to pay for both, the agent left the sunset, blocked the phone number and dissolved in the haze of mangrove forests.
Verified, detailed and extensive data, the real estate expert's main foothold. The main weapon is balanced and unbiased analytics. At this stage, we come to a subtle, subtle element of verification that will be decisive in choosing a truly worthy expert.
You need to understand that the main motivation of any agent is getting a commission. However, the devil is in the little things, and the main difference between a professional and a swindler is the methods that are used in the work, and most importantly, the intention to continue the relationship even after the deal is completed.
A competent specialist knows exactly his value. He plays openly, and knows that his services are used primarily because he is a balance of interests between the buyer and the developer. A professional agent constantly collects data, analyzes it and presents to the buyer a squeeze of worthy projects. For example, they post publicly the data of all developers and projects, indicating the names and contacts.
Important to remember:
Always ask to justify why the agent insists on choosing a particular project.
Quite often, heavily overpriced projects (initially overpriced) offer agents increased commissions for promoting the project to buyers. It is not easy to recognize this trick, but there is a very simple way:
Choose a project located in a popular tourist area (Kata, Karon, Kamala, Bang Tao, Surin). Make sure that the distance from the beach does not exceed 700 meters, and you can easily walk to the beach from the project.
Then consider projects located in less popular areas and at a distance of more than 1 kilometer from the bathing beach (Rawai, Chalong, Kathu, Mai Khao, Layan) and compare the price fork with previous options for a similar area.
If in less popular areas the price is similar to the first option or inferior by 10-15%, you should know that they are trying to sell you a project with an overpriced price. The fact is that the distance from the coastline is the main component of the cost of land in Phuket. Agree, it is strange when the price of an apartment of 30 square meters in a project built on a plot of land worth 90 million baht per rai (1,600 sq.m) is completely identical to the price in a project where the land plot is estimated at 7 million per rai.
Naturally, in a project where developers, eager for super-profits, have increased the extra 30-40%, there is an excellent opportunity to pay an increased commission and bonuses to the agent. But does this mean that the project itself is really worth it?
So, to summarize:
A high-class specialist, a real expert is always ready to reasonably prove the advantages of certain projects. He does not idealize any of them and speaks calmly and confidently about the shortcomings (which are enough in any project, even the most ideal one). At the same time, when discussing projects that, in his opinion, should not be considered for investment, he never stooped to insults and “creepy stories”. In general, the principle of playing on “fears” is another trigger of a pseudo-expert, and this knowledge is also worth putting in a piggy bank.
The final sign of the agent's reliability. No, this does not mean at all that large or small agencies do not deserve your attention. But from experience we can say that in agencies with a large number of employees, there is always a shift in responsibility, especially in acute situations.
Agents who operate under their personal brand are to a greater extent responsible to their client, because you can literally lose the reputation of a personal brand from one deal, and you can create a new one for years.
It's easy to research an agent's personal brand. All of them are active in social networks, create their own content, which forms the basis of their marketing.
How do I check a personal brand?
Study the agent's social media pages carefully. Firstly, an honest and open specialist always conducts activities under his own name, and places his face on the avatar. Please do not negotiate with palm trees, beaches, butterflies, cats and monkeys on avatar photo - this is not serious.
Pay attention to how the profile is filled out, whether the name of the company and other information relevant to work is indicated there,
Carefully study the content produced by the agent. Even before meeting with him, you will already imagine the train of thought and manner of communication of this person. And also, you can carry out the check described in the second stage of our guide.
Study the manner of communication of the agent in communities, groups of public pages. This life hack easily allows you to recognize hypocrisy and a double bottom of the personality, when in a conversation with you the agent abounds in equivocations and curtsies, and in holivars he communicates like a cattle or a criminal authority.
Don't pay attention to the number of likes and followers. Both that and another can be screwed up by unscrupulous entrepreneurs. It is much more important to study the feedback from customers, the semantics of the agent's answers to open questions.
Pay attention to the regularity of content updates. Pages “sleeping” for months should also be a wake-up call. In the current pandemic world, all activity has gone online, and if there is no activity there, then there is no activity at all.
Conclusion. Why is all this so important?
So, you have chosen an agent who fully meets the positive criteria for this guide. We can congratulate you, because there are not even dozens of such specialists in Phuket. You can safely trust such experts and listen to their opinion.
It is high-class specialists who are still the locomotives of real estate transactions, value the reputation of the island as a whole and work in the long term.
We hope that our advice will help you decide on the choice of an expert to whom you can safely entrust the choice of direction for investment. After all, the entrance to the real estate investment market in Phuket even now starts from $ 100,000 and we firmly know that each of you does not want to waste this money.