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Negotiate after Sale Agreed?

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    #32
    Claw Hammer
    Registered Users Posts: 6,239 ✭✭✭Claw Hammer


    mitresize5 wrote: »
    Every week the same question...

    The house is 40 years old. Of course the engineers report is going to throw up issues. The house was originally built to 70's standards and has aged 40 years since.

    Your doing quite well if you get change out of 10k to bring it to modern standards.

    Not a pop at you OP but there is a element of naivety with most people buying older houses ... I'm amazed at what people expect from an engineers report

    You can ask to renegotiate but I'd expect you'll get short shift
    The o/p has already said that this in an additional expense on the sums he was intending to spend to bring the house up to modern standards.


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    #33
    davo10
    Closed Accounts Posts: 6,926 ✭✭✭davo10


    daheff wrote: »
    I understand the meaning of net thank you very much.


    Cant see how the poster works out that EA pays 40% on the additional fee though.

    The marginal rate of tax is approximately 40% of gross subject to deductions above a certain threshold of income. Most EA's will surpass that threshold. EA's typically get paid around 1% of the purchase price in commision so for every €10k the sale price increases, the EA gets an additional €100 gross in commision, €60 after tax.

    I don't think you understand the meaning of net as well as you think you do.


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    #34
    daheff
    Registered Users Posts: 5,866 ✭✭✭daheff


    davo10 wrote: »
    The marginal rate of tax is approximately 40% of gross subject to deductions above a certain threshold of income. Most EA's will surpass that threshold. EA's typically get paid around 1% of the purchase price in commision so for every €10k the sale price increases, the EA gets an additional €100 gross in commision, €60 after tax.

    I don't think you understand the meaning of net as well as you think you do.


    you are assuming that the EA is a sole trader here. In a lot of cases they aren't. Company taxes are paid at 12.5%, not 40%.

    <mod snip: please familiarise yourself with the forum charter>


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    #35
    Cyrus
    Registered Users Posts: 20,106 ✭✭✭✭Cyrus


    daheff wrote: »
    you are assuming that the EA is a sole trader here. In a lot of cases they aren't. Company taxes are paid at 12.5%, not 40%.

    and then the employee EA will get his commission, which is even less, so even less worth his while


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    #36
    boatsandhoes
    Registered Users Posts: 14 ✭boatsandhoes


    I would definitely try and get money off the purchase price if its possible. I recently bought a house and when i got the surveyors report back the work totaled about 43k. some necessary, some suggested. I went back to the estate agent saying it was a good 20k over what i had budgeted etc etc can he try and see if the vendors can move on it. I sent on the surveyors report and they agreed to knock 10k off the price. They had also gone sale agreed and lost the first seller. If you dont ask you wont get. The same situation happened with a friend of mine also so its 100% worth asking. They can only say no.


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    #37
    McGrath5
    Registered Users Posts: 2,378 ✭✭✭McGrath5


    The OP's attitude to this surprises me, a property that was built in the 70's will surely throw up some issues that take time and money to fix.

    The OP is obviously stretching themselves to their financial limit to purchase this property, IMO you need at least €10k contingency fund in a scenario like this.


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    #38
    Askthe EA
    Registered Users Posts: 724 ✭✭✭Askthe EA


    daheff wrote: »
    you are assuming that the EA is a sole trader here. In a lot of cases they aren't. Company taxes are paid at 12.5%, not 40%.

    Maybe you don't understand the meaning of net as well as you patronizingly think?

    I can assure you, I would be very slow to walk away from a deal I had broken my balls on over a few k. Its not about the money its about the time invested in the deal. As another poster said, a jump or fall of 10k is worth approximately €100 -€200 to the firm. To me (as an employee), its actually worth a fraction of that. My time is far more valuable.

    Obviously we want to maximise sale price, goes without saying, but ultimately a successful sale is far more beneficial to us. Never underestimate the power of a sold sign. We are also paid to advise our client and I'm sure the EA on this example will do the same.

    In the example above, the simple fact of the matter is that the property had previously been sale agreed and fell through. At least three engineers have been through the building and all have recognised the issue. This is most likely why the sale fell through in the first place. Unfortunately, this suggests that the vendors are not willing to agree a lower sale price otherwise the original sale may have progressed, but who knows.

    100% go back armed with the engineers report. The vendors may not come down the full 7k but they may meet you halfway!


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    #39
    daheff
    Registered Users Posts: 5,866 ✭✭✭daheff


    Askthe EA wrote: »

    Obviously we want to maximise sale price, goes without saying, but ultimately a successful sale is far more beneficial to us. Never underestimate the power of a sold sign. We are also paid to advise our client and I'm sure the EA on this example will do the same.

    Theres an inherent contradiction in this advising the client. Once the sales price gets to a certain level where the seller is happy to sell, the agent would view it as generally not worth their while to push on with viewings etc. As you say above the company might make 100Eur more on a 10K increase. 100Eur isnt a good return on the time invested by staff...but 10k is big for the seller. In my experience (and i'm in the middle of selling) the agent is happy to take their fee once the sales price comes close to a level the seller is happy to accept at...not to push the price to the absolute max.


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    #40
    Askthe EA
    Registered Users Posts: 724 ✭✭✭Askthe EA


    daheff wrote: »
    Theres an inherent contradiction in this advising the client. Once the sales price gets to a certain level where the seller is happy to sell, the agent would view it as generally not worth their while to push on with viewings etc. As you say above the company might make 100Eur more on a 10K increase. 100Eur isnt a good return on the time invested by staff...but 10k is big for the seller. In my experience (and i'm in the middle of selling) the agent is happy to take their fee once the sales price comes close to a level the seller is happy to accept at...not to push the price to the absolute max.

    A good agent will always maximise price. If I do a good job and you're happy you would recommend me. However, there are areas of concern which I'd relay to my client. Sometimes the highest bidder may not be the best bidder. I may have concerns over their willingness to close for instance. They may be in a chain. If you progress with the higher bidder and it falls apart, the client may be left with nothing.


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