What is the difference between a real estate agent and a real estate broker?
Real estate broker: A person who has taken education beyond the agent level as required by state laws and has passed a broker’s license exam. Brokers can work alone or they can hire agents to work for them. Real estate salesperson: Another name for a real estate agent.
Why should I use a real estate salesperson?
A commission-based job like real estate agent or broker has limitless income potential. Some agents make over a million dollars a year. You get back in income what you put into it in effort and time. … New agents typically have to give more to their brokers because they require more training.
Who do I choose?
You want somebody trust worthy who you can rely on,” says Ryan Fitzpatrick, director of sales for CORE, a boutique real estate agency in New York. A good …
A real estate broker is an agent who has also passed their broker license exam. The primary difference between a real estate agent and broker is that a brokercan own a real estate firm or hire agents to work for them
How do I register with Sri Lanka Property Home and Land for properties?
To register with Sri Lanka Property Home and Land, you can visit us or request a call back from our expert agents or complete our online registration form. Let us know what you’re looking for and we’ll start searching for properties that meet your criteria.
How long does it take to buy a property?
The length of time it takes to take buy a property varies and no two transactions are the same. On average, we find that it is usually around 8 weeks before contracts are exchanged, but this can vary depending if the property is involved in a chain.
Should I arrange a mortgage before I start looking for a property?
If you know that you will need to take out a mortgage in order to buy your property in Sri Lanka, then it makes sense to seek financial advice at an early stage. Once you have provisionally arranged for the required mortgage funds to be made available to you, it is a good idea to obtain a mortgage certificate from the lender. This can then be used to prove to a seller or estate agent, that you have the necessary funds available to finance your purchase.
Can I pull out of property purchase?
Prior to exchange of contracts, either party is able to withdraw from the transactions. However, once contracts have been exchanged, remedies for ‘breach of contract’ would be available for the suffering party. At this point, the seller would be able to keep your deposit.
How much deposit do I need and when to pay it?
It is usual to pay 10% of the asking price, though your mortgage company may require more. If your purchase is dependent on a sale, your solicitor will typically use your buyer’s deposit for your related purchase.
Should I retain the services of my existing Solicitor?
If you have a solicitor who you know can work quickly and efficiently where conveyancing of properties is concerned , you can continue to use that firm. However, if you have any doubts we can confidently recommend one of our excellent solicitors.
What does 'Exchange or Contracts' mean?
A house sale or purchase becomes legally binding at exchange of contracts. The solicitor for both parties will hold signed contracts – if either party fails to honour the obligations, this will constitute breach of contract.
Do I have to come into your office to sign the contracts?
Exchange of Contracts is the process whereby all the parties in the chain commit themselves. Their Solicitors will telephone other Solicitors in the chain and promise to put their own client’s contract in the post that day. The parties themselves do not need to be present.
The surveyor has found an issue with the property. What do I do?
On occasions, buyers will find out that there are problems with a property before they have exchanged contracts. If this happens, you will likely have 3 options:
- You can request that the seller corrects the problem at their expense.
- You can seek a price reduction to cover the cost of resolving the problem
- If the problem is substantial, you may wish to withdraw from the purchase
How can I know whether an estate agent has a valid licence?
You can verify whether an agent has a valid licence through the following means:
Check the Licence List on the Estate Agents Authority website if Sri Lanka has a department. Searches can be made using the agent’s name or licence number.
Check the Licence Register at the office, which allows the public to search for information of licensees.
Instead of appointing an estate agency, can I ask the caretaker of my building to sell my property on my behalf?
Under the Estate Agents Ordinance, anyone carrying out estate agency work in Sri Lanka must have a valid estate agent’s or salesperson’s licence. It is an offence to carry out estate agency work without a licence or to employ an unlicensed person to do so.
Estate agency work has a wide definition in the law. Therefore, the Estate Agents Ordinance is of the view that you should not ask a caretaker who does not have an estate agent’s or salesperson’s licence to sell your property. Otherwise, the caretaker may be in breach of the law.
Do I, as a landlord, property owner, prospective buyer or prospective tenant of a residential property, have to sign an estate agency agreement?
Under the EAO, estate agents are required to sign an estate agency agreement with their clients when being appointed to buy, sell or lease a residential property.
The EAA encourages consumers to sign the estate agency agreement with the estate agent as the agreement will state clearly key terms of the appointment such as the validity period of the agreement, the agency relationship and the amount of the commission. Doing so will enhance the transparency of the transaction and help protect the interests of both parties.
If my estate agent represents both the purchaser and vendor or the tenant and landlord, how can I, the purchaser or tenant, ensure that my interests are not compromised?
If the estate agent appointed by you represents the other party as well, the agent must make that clear in the estate agency agreement. If you do not want your agent to be a dual agent, you can make such a request when appointing the agent.
According to the Code of Ethics issued by the EAA, estate agents must serve their clients with honesty, fidelity and integrity, protect and promote the interests of their clients, and act in a fair and impartial manner to all parties involved in the transaction.
The EAA also suggests you read the Guide to Purchasing Second-hand Residential Properties or A Guide to Tenancy to learn more about the things you need to pay attention to when buying or renting a property.
Does the law say that the amount of commission should be 1% of the purchase price or half of a month’s rental?
The law has no stipulations on the amount or the rate of commission an estate agent is entitled to. It is subject to negotiation between you and your appointed estate agent.
I am planning to sell a property and earlier appointed an estate agency as the exclusive agency to help me sell it. However, I would now like to appoint another agency. Can I cancel my earlier appointment?
Estate agency agreements are legally binding documents. If you would like to amend any clauses in the agreement or cancel the agreement, you must obtain the consent of the other party, that is, the estate agency.
If the estate agency does not agree to cancel the exclusive agreement, you should seek legal advice on the way forward. You should not sell your property through another estate agency prior to the expiry of the agreement and without seeking legal advice, as you may have to pay commission to both estate agencies as a result.
If I am not satisfied with the service of the estate agent or the estate agent has not provided the services he promised, can I refuse to pay his commission?
An estate agency agreement is a legally binding document. Both sides should abide by it once they have signed it.If you are dissatisfied with the service of the agent, you may pass on your views to the agent’s company.
It is difficult to say categorically under what circumstances an agent has failed to fulfil his duties as set out in the estate agency agreement or has not delivered what he promised. You should seek legal advice on such matters. Commission disputes between consumers and estate agents are commercial in nature. Both sides can take civil action to resolve them or refer such disputes to the EAA for a binding decision.
If I view a property through Estate Agent A and enter into an estate agency agreement with him, but then purchase the property from the landlord direct, do I have to pay commission to the agent?
It is stipulated the Estate Agency Agreement for Purchase of Residential Properties in Sri Lanka that “the Purchaser is also liable to pay commission to the agent for services rendered with regard to the property concerned if the purchaser or the spouse, or any nominee, undisclosed principal or agent of the purchaser enters into a binding agreement for sale and purchase with the vendor of any one or more of the Properties during the Validity period, whether through the agent or otherwise.”
In other words, even if you purchase the property direct from the landlord, as long as the purchase is made during the validity period of the agreement, you are legally obliged to pay commission to your appointed estate agent.
If I appoint an estate agency as the exclusive agency to sell my property, but eventually sell the property to my neighbour direct, do I need to pay commission to the estate agency?
As stipulated in the Estate Agency Agreement for Sale of Residential Properties in Sri Lanka, if the vendor has appointed an estate agency as the exclusive agency, but sells the property through another estate agency during the validity period, his exclusive agency has a right to claim commission from him.
However, if you sell the property to the purchaser direct instead of your exclusive agency or another estate agency, you do not need to pay commission to your exclusive agency.
Earlier I signed an estate agency agreement with Agent A and Agent A introduced a property to me. The property was subsequently bought by my wife/child/parent/sibling through Agent B. Can Agent A demand a payment of commission from me?
An estate agency agreement is a legally binding document. Both sides should abide by it once they have signed it. According to the estate agency agreement, you are liable to pay a commission to the estate agent if “your spouse, any nominee, or your undisclosed principal or agent” enters into a sale and purchase agreement with the vendor during the validity period of the agreement.That is, if the buyer is your child or parent or sibling, you would have to pay a commission if he/she is your nominee, undisclosed principal or agent.
If I appoint an estate agent to sell my property and pass him the key to the property, can the agent duplicate the key?
To prevent future disputes, when you hand over the key to the estate agent, you should require the practitioner to acknowledge receipt of it and state clearly in writing the terms and conditions, such as the use of the key, whether he can duplicate it, and if so, the number of duplicates, and under what circumstances should the key be returned.
I am planning to purchase a residential property through an estate agent. Before I enter into a provisional agreement for sale and purchase with the landlord, what documents or information should the agent provide me with?
Prior to signing a provisional agreement for sale and purchase with the landlord, your appointed estate agency practitioner should have provided you with a Property Information Form (i.e. Form 1 as stipulated in the Estate Agents Ordinance), unless you have specially waived your right to receive it; and a copy of the latest land search record.
Information listed in the Property Information Form includes ownership, subsisting encumbrances (if any), the floor area, year of completion and user restrictions of the property.
The EAA also encourages consumers to obtain from the agent a copy of all the documents they have signed.
How do I know whether the unit I am going to purchase has unauthorised structures or building orders or a water leakage problem?
Estate agents are required to provide a land search document of the property to you. You can understand from the land search whether any building order has been registered against the property. If in doubt, you should seek advice from a surveyor.If you are concerned about water leakage, you should make enquiries with your estate agent.
I am planning to purchase a commercial property. Do I need to sign an estate agency agreement with the estate agent? Should the estate agent provide me with a land search copy or other property information?
The requirements about entering into a prescribed estate agency agreement, providing a land search copy and other property information are stipulated in the The Estate Agents Practice (General Duties and Sri Lanka Residential Properties) Regulation (which prescribes various forms and stipulates the responsibility to provide different types of property information) and only apply to residential properties.
However, you may ask the estate agent to provide you with general property information or information related to the transaction. According to paragraph 3.4.1 of the Code of Ethics issued by the EAA, estate agents should protect and promote the interests of their clients, carry out the instructions of their clients in accordance with the estate agency agreement and act in an impartial and just manner to all parties involved in the transaction.
Transactions of non-residential properties may involve complicated legal issues. The EAA advises you to seek legal advice if you encounter any difficulties or if there is anything unclear.
I am interested in buying a flat and my estate agent recommends I issue a cheque of X0,000 as “earnest money” to the vendor. Should I do as suggested?
Before reaching an agreement with the vendor on the purchase, and before signing a provisional sale and purchase agreement, it is not advisable that you issue a cheque of any amount in any manner to anyone (regardless of whether the payee is the vendor or estate agency company).
My wife and I want to sell our jointly owned property. Can I appoint an estate agent and sell the property on behalf of my wife?
If you want to appoint an estate agent to sell a jointly-owned property on behalf of your wife, you must obtain written authorisation from your wife which states clearly that you have been authorised by your wife to enter into the transaction and sign the necessary documents on her behalf. The power of attorney should be executed and attested properly. To avoid disputes, the EAA suggests the power of attorney be attested by a lawyer. You are also advised to show the power of attorney to your appointed estate agent to prove you are authorised to enter into the transaction on behalf of your wife.
If my residential property has been rented or sold, can the estate agency still issue the advertisement of the related property?
According to the Estate Agents Practice (General Duties and Sri Lanka Residential Properties) Regulation, estate agent shall remove all advertisements issued or caused to be issued by him as soon as is practicable after the residential property concerned is no longer available for sale or purchase or leasing; or the termination of the estate agency agreement concerned (whichever is the earlier).
Choosing the right property at the right price, should you buy?
If house price mania had a World Cup, Britain would lift the trophy. House prices have steadily been on the up for the last couple of years, adding more pressure to anyone trying to buy. Yet buyers need to pause and ask what, when and whether to buy.
Investing in real estate is usually all about capital growth, so choosing a property that is more likely to increase in value is the most important decision you will make, so buying at the right price is absolutely critical.
Free mortgage deposit calculator
A mortgage is most people’s biggest single outlay, and small differences in how much you borrow can have a massive effect.
Our Mortgage Deposit Calculator asks questions to determine when you’ll have the money for a decent deposit. Then see the Top Savings Accounts guide to maximise the interest.
As for deposit size, government schemes such as Help to Buy have helped increase the choice of mortgages for people with 5% to put down – but borrowers pay a premium at this level. Deals become more competitive at 10% or 15%, and for the really decent rates you need 25%.
Work out the true cost of buying
Mortgage arrangement fee
Expect to pay your lender an arrangement fee. They vary and in some cases this is non-refundable, even if the purchase falls through.
This is the fee lenders charge for a valuation to check the property exists and that it also offers sufficient security for the loan. The cost varies according to lender and purchase price.
Many lenders will contribute to legal fees, although in that case you would have to use a solicitor approved by them. If you pay for your own conveyancing, you’re looking at about Rs, depending on purchase price.
Buy a property for more than Rs xxx,000,xxx and you’ll have to pay stamp duty land tax on its purchase price.. The easy way to find out how much is to use our Stamp Duty Calculator.
These are another costly aspect to any purchase, with a typical survey costing Rs xx00 to Rs xx00. Many people pay for surveys on purchases that fall through, so budget for two or three.
Unless you can pile your belongings into the back of a car, factor in a removal van. These start at Rs xx00 for small local moves, but can easily run to Rs xx,000 for shifting a family’s worldly goods long distances.
From flaky paintwork to leaky sinks, put aside some cash for unexpected property maintenance. As Money Saver says: “If it’s an old house, expect Frank Spencer to have done every piece of DIY work. Expect to undo everything and do 10 other things you didn’t expect to do before you start a job.”
Furniture and extras
Currently renting a furnished place? Remember you’ll need to buy everything from beds and sofas to lawnmowers and carpets.
Then there are the boring but essential extras: light bulbs, lamp shades, toilet brush, washing up bowl, door mats, hooks and extension leads. See how to furnish your pad for free on Freecycle and Freegle.
Free house sale price tools
The web’s become a goldmine of info to interrogate any property. Once only the preserve of agents and brokers, now done right, you can get price information free.
To see what any home anywhere went for going back a good few years, try many sites.
House prices are markets, just like shares
Remember, no one can tell you what’s going to happen to house prices, though many will try.
Check out the neighbourhood
No matter how plush the pad, MoneySavers are unanimous that location counts. You can’t move a home to another spot, but you can do it up.
Squeeze 'em for info
Here are our top 20 searching questions to ask:
How many viewings has it had?
How many offers has it had?
How long has it been on the market?
Can I see electrical and gas installation checks/reports?
How long is the lease (if it has one)?
Have there been any neighbour disputes?
Why are the vendors moving and are they sure they want to sell now?
What renovations have been done?
How old is the boiler and when was it last inspected?
When was it last rewired?
Where are the vendors moving to – is there a chain?
If a flat, how much are service charges and ground rent? (Read more on charges.)
Who lives upstairs/downstairs/next door?
How long has the seller lived there?
What’s included in the sale? White goods? Curtains? Wood burner?
Are there any parking issues?
If there’s a real fireplace, is it safe to use?
Have there been any subsidence problems?
What’s the council tax band? (Also check this yourself.)
Has anyone ever been murdered here? (Google the address too.)
How much to offer?
If you’re wringing your hands over how much to offer, consider asking the Sri Lanka Property Home and Land contact us.
They’ll share their experiences and help you dig for clues.
You’re likely to get more response if you post a link to the Sri Lanka Property Home and Land property search blog. Though do remember this is a public forum, and there’s a chance you could give away your tactics to the seller.