Undisclosed Marketng Commissions

Discussion in 'Legal Issues' started by The_Husband, 30th Nov, 2002.

  1. The_Husband

    The_Husband Member

    Joined:
    28th Sep, 2002
    Messages:
    49
    I few years ago I purchased a unit off the plan from a 'investment' company. It is due to complete at the end of next year. I beleive that I paid market valuation for the property, but I now think that the developer paid a large undisclosed commission to the marketer. This was probably disclosed as a 'marketing fee' or similar.

    Friends have said that I may be able to get out of this contract becasue the person that I dealt with doesn't have a RE sales licence, though I am sure the company itself did. But I would rather keep it as I beleive it has gone up considerably.

    My question is, is there anythign I can do to get some of that commission to be deducted from the purchase price?

    Thanks again

    TH
     
  2. Rolf Latham

    Rolf Latham Member

    Joined:
    2nd Mar, 2001
    Messages:
    18,791
    Location:
    Confused = Sydney, Brisbane and Gold Coast
    Hi TH

    If you believe you paid market then why worry ?

    Ta

    rolf
     
  3. The_Husband

    The_Husband Member

    Joined:
    28th Sep, 2002
    Messages:
    49
    Rolf

    Good Point.

    But, It is just annoying to know that someone has rippend you off. I think the sum inloved is around $20,000 which is a bloody lot of money. I beleive that this happens all the time in Real Estate marketing.


    TH
     
  4. Lady Lea

    Lady Lea Member

    Joined:
    10th Nov, 2002
    Messages:
    13
    Location:
    London, UK
    Cutting someone out of their bit is a shame.

    I believe if someone has done work for somehting you should pay them well - then they will come back and do more. If you try and get out of the payment it could tar you with a reputation that you dont think people deserve paying.

    My personal experience is that paying people well for what they do brings you rewards. If someone offers deals and they know i pay the highest finders fee - they will come to me first - alowwing me to cherry pick.

    I think what the developer does with his money is his business, and as long as you got what you bought - ie property - and it valued up to what you anticipated - I dont think you have been ripped off.

    Lady Lea
     
  5. Fester

    Fester Member

    Joined:
    9th Oct, 2002
    Messages:
    221
    Location:
    Adelaide, SA
    This is my argument about the Investors Club. I have a few properties purchased through them. I am very satisfied with what I have. I did my "due diligence" and research beforehand. I used them as a vehicle to purchase properties I thought were good value, and I believe I have that. I don't give a rats what Kevin Young or the Investors Club get out of it. I am only interested in the final figures. It was a good deal for me, and that is all that matters!
     
  6. Kevmeister

    Kevmeister Member

    Joined:
    16th Oct, 2002
    Messages:
    812
    Location:
    Fawkner, VIC
    I agree with Rolf. If you paid market price then what the developer paid the marketer shouldn't concern you, should it?

    If I was buying a PPOR and I paid market price, should I be concerned what the vendor paid the real estate agent in terms of commission?

    The critical issue is that you believed you paid market price, and if that's true, the commission paid to the marketer _should_ have come out of the developer's pocket, not yours.

    Kevin.
     
  7. NigelW

    NigelW Member

    Joined:
    2nd Mar, 2001
    Messages:
    1,013
    Location:
    Brisane
    Don't want to be a stirrer here...but if you think someone skimmed $20K out of the deal then doesn't that mean by definition that you paid $20K over market? :(

    my approach is to look at the deal and see who makes money from it. if there's someone other than the vendor and their real estate agent then they better be contributing some serious value for me!

    of course the countervailing argument is that perhaps the $20K you paid is for saving you the time finding this investment that you now think you'll hang on to.

    at the end of the day, property is very forgiving in the long term, which I guess may be why you are now happy, a few years down the track, that its all worked out okay...

    I'd rather hunt down my own deals - but its a matter of personal choice. perhaps my portfolio would be bigger if like many other busy people I used a buyers agent or bougt through a club etc. I'm just not comfortable with that approach...yet.

    After all, you make (a fair bit of) your money when you buy! ;)

    Cheers
    N.
     
  8. Fester

    Fester Member

    Joined:
    9th Oct, 2002
    Messages:
    221
    Location:
    Adelaide, SA
    You say buy a motor vehicle from a dealer.
    Dealer "A" charges you $30,000, you are happy!
    Dealer "B" down the road charges $30,000, but he makes a premium commission of $2000 more than dealer "A". Does it make a difference? Whether you go to dealer "A" or dealer "B" the outcome for you is the same. If dealer "B" can score a further $2000 good luck to him!!
    Why is real estate any different?

    Happy investing ... Fester