tag:blogger.com,1999:blog-76220354996363539642024-03-26T13:50:52.750+08:00 justLetak!Estate Agent Exam LPPEP, Sales & Marketing, Philosophy, ICT, MICTM (06/09) AeU!Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.comBlogger228125tag:blogger.com,1999:blog-7622035499636353964.post-25263449713713554922019-02-25T08:31:00.002+08:002022-10-25T15:07:08.059+08:00MY WEBSITES<h4>
WhatsApp click below:</h4>
<div>
<a href="https://thomassim.wasap.my/" target="_blank">I would like to know more...</a></div>
<h4>
<ul style="text-align: left;">
<li><a href="http://justletak.com/" target="_blank">justletak.com</a> - Main Window to my websites.<br /><br /></li>
<li><a href="http://findwhere.info">findwhere.info</a> - Community of Agents GeoLinking Businesses Together<br /><br /></li>
<li><a href="http://myrealproperty.online">myrealproperty.online</a> - Listings and advertising for FREE! Articles about Estate Agency Practice.</li>
</ul>
<ul>
<li><a href="http://estateagentexam.com/" target="_blank">estateagentexam.com</a> - Online self-study for the Board Estate Agent's Examination, leading to a Diploma in Estate Agency awarded by BOVAEP, Malaysia</li>
</ul>
<ul style="text-align: left;">
<li><a href="http://contract2u.com/" target="_blank">contract2u.com</a> - Calculator for Comparative Index & Inter-Property Index, Listing on MAP.</li></ul><ul style="text-align: left;"><li><a href="http://my-realestateforum.blogspot.com">my-realestateforum.blogspot.com</a> - free questions for Estate Agent's Examination</li></ul>
</h4>
Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com3tag:blogger.com,1999:blog-7622035499636353964.post-1738051398209588002018-12-24T10:40:00.000+08:002018-12-24T10:40:28.706+08:00Strategy for LPPEP EA ExaminationStrategy for Examination<br />
<br />
Go <a href="http://estateagentexam.com/strategy-for-examination/" target="_blank">here to read of this Article relating to "How to Best Tackle the LPPEP Examination for Estate Agents"</a>.<br />
<br />
<br />Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-5205111055817254362018-10-08T09:38:00.001+08:002018-10-09T08:14:06.456+08:00Can Artificial Intelligence take over estate agency?Q.<br />
Do you think Estate Agents will be out of job in the AI (Artificial Intelligence) era in the future?<br />
<br />
A.<br />
Modern machine capabilities generally classified as AI include successfully understanding human speech, competing at the highest level in strategic game systems (such as chess), autonomously operating cars, and intelligent routing in content delivery networks and military simulations.- Wikipedia.<br />
<br />
In this context, if AI can open and close door and negotiate prices (or there is fixed pricing) I think it can replace agents to a great extend. Can’t it?<br />
<br />
Imagine you fix a programmable locking system to your main door which enables you to change passwords online. When a prospect wants to view your property, you just send him the password. You need not have to go there. Everything else can be negotiated via telephone. You do NOT need to go yourself to open and close the house. Quite realistically, this is no AI yet!<br />
<br />
If you are worried about your valuables in the house, you would NOT simply give your password unless they pay a deposit. For stolen things (even you have CCTV), you can deduct from the deposit. Now, this becomes a problem. This is a problem of trust, not a problem of AI.<br />
<br />
When it involves trust, estate agency practice comes in. As a prospect, you cannot trust the landlord/owner because he might not return you the deposits. He just hold your deposits although you saw the house in good faith but did NOT want to take it - reason is not important. This is the same as a tenant or purchaser putting booking fee, but eventually turn down the property with certain conditions not fulfilled. The booking fee should be returned immediately.<br />
<br />
In the relationship of an agent to the principal in dealing with the third party, there is a certain amount of protection of rights of the third party which makes this relationship necessary. It is not really about the physical means to achieve a contract. It is about the duty and independence of the three people in an agency contract.<br />
<br />
Indeed, it is not about technology or AI taking over the physical job, the core reason of estate agency is trust. Can AI take over this trust? Cannot. However, AI can be used by estate agent to better perform the tasks. No matter what, landlord/owner and estate agent canNOT be the same person. Or else, there is no protection to the rights of the tenant/purchaser.<br />
<br />
Furthermore, there are issues about undisclosed principal - a buyer or seller who does NOT want to be contacted. In such scenario, there have to be a person entrusted with the job - an agent. This cannot be solved with AI because even when an undisclosed buyer can trust an AI to come into contract with the seller, the seller might not be confident to contract with an AI which might not represent the buyer. <br />
<br />
For example, you are a billionaire and you need to buy a plot of land. However, you would prefer your identity to be kept a secret. So, you set up an AI. And, AI for that purpose is like an anonymous phone call, it does NOT represent anyone to come into contract. <br />
<br />
When this AI contact the seller, they seller wants to know who this AI is. Then, you say I am a Secret. How would the seller trust a Secret Person? Therefore, it has to be an AI controlled by an estate agent which can take this contract legal because the third party can come to contract with this estate agent which is binding to the principal - buyer. <br />
<div>
<br /></div>
Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com2tag:blogger.com,1999:blog-7622035499636353964.post-72715558857651549292018-10-07T20:44:00.002+08:002018-10-07T21:09:48.060+08:00Joining a MLM Agency FirmQ.<br />
New to the business? We are inviting young and energetic business partners to join our agency! Together we forge for a real estate empire!<br />
<br />
I was thinking, is it that easy to make money from real estate?<br />
<br />
Come to think of it, the real estate agency practice had been tarnished by many who are "hit and run" operators. What it means is you sell only once in a long time for this client, so you do NOT really matter whether he is screwed or not.<br />
<br />
In selling or letting a property, you take great care of the owner/landlord. You really do NOT care much about your buyer or tenant. They will have to submit to your whim and fancy or that of your principal. They can offer whatever amount but it is still your right to take that offer to your principal and be accepted. If you never take that offer to your principal, he won't probably know as well.<br />
<br />
Therefore, as a tradition, all agency firms work on the seller/landlord end and neglected the purchaser/tenant side.<br />
<br />
Over the years, it had been good times as property is a scarce commodity. You can have a proud landlord who says I will rent to the best tenant I can select. I will discriminate so and so types of tenants. It is my right as owner, I decide.<br />
<br />
Well, over time the property supply overwhelmed the demand. Or put it in another perspective, as people have choices to buy or rent, the table is turned to the other side.<br />
<br />
Therefore, agency firms can be listing tens and hundreds of property for sale and let, but nobody is taking them.<br />
<br />
This has become the disconnect between the agency firm and the public. Why? Because public do not trust the agent (broker especially) and when you ask about how many potential buyer or tenant a firm has? No firm can give you any figure. They can give you figure of how many listing of landlords and sellers, but they cannot give you who are the buyers or tenants.<br />
<br />
This is intrinsic of the estate agency practice as buyers and tenants do NOT pay fees. At least, not in the local setting in Malaysia.<br />
<br />
I wrote so much about this before I answer the issue of MLM (multi-level marketing) agency structure above in real estate practice. There is a few reasons. Firstly, to let you understand the defective strategy of agency work in our local setting all this while. Secondly, to let you appreciate what I am going to point out below about MLM agency structure and its flaws.<br />
<br />
Traditional RENs and Agents are not tuned to MLM system, so they hope that MLM system as in Cosway etc will bring more clients to the agency for its products. Theoretically, by garnering more network of field force, you will have better reach to the public. Furthermore, the most significant different from conventional selling is MLM scheme sells to its members, as well as pays them for successful referrals. It might be more convincing doing the mouth to mouth selling than selling in Mudah.my, for example.<br />
<br />
Hence, MLM scheme recruit members as users and sales force.<br />
<br />
On the surface, this might be so and is a successful factor in MLM for smaller townships. Why? Because auntie and uncles believe more in coffee table gossips than going to the bank and find out from the bank officer what is today's exchange rate.<br />
<br />
Property in bigger cities (where agency firms are present) is not a toothpaste that can be sold just over a coffee table. So, this strategy won't work in Real Estate Business. And, MLM works on products which are easily replaceable or substituted. Like instead of toothpaste A, now use toothpaste B.<br />
<br />
Due to its complexity, property market would not grow like a fast moving consumable good (FMCG), therefore the various level of MLM pay out will not be achievable in a short term. Owing to this inherent nature of the business, and worsened by the recent slow down of the entire industry, MLM scheme will not work on property.<br />
<br />
You will see people being recruited and paying membership joining fee in significant sum, yet the business will just stagnate and eventually increase to a temporary hype, thereafter plateau and might plummet to another new low.<br />
<br />
This is because initially when the recruitment drive is on, people are in high spirit. As more crowd join in the sales force, some newbies might eventually buy some properties themselves - as users. Thereafter, those who cannot afford to buy might close some sales. In general, there cannot be any repeat sales among members! Next, they will suffer a period of anticipation of downline making them rich... which never really happened. Finally, when no more new sales are made, they will eventually leave the firm.<br />
<br />
Imagine, have you ever think that such MLM scheme be used for insurance scheme? It is of course, prohibited as well by Bank Negara Malaysia ruling in the first place. But, if ever MLM is used for insurance scheme, it would not be possible as over time, many will abundant their insurance and join a new insurance scheme like buying toothpaste B replacing toothpaste A. Would that be able to sustain? The whole financial system will not be able to sustain it.<br />
<br />
When is MLM best used? When there is element of speculation, or in its root word - greed. Notwithstanding, only when a commodity is without price - like propagating a gospel for religious purpose - valueless/no value, then MLM is without flaw. By word of mouth religion has been the most successful MLM scheme of all times.<br />
<br />
So, property is something with value. Thus, MLM system for property will only work when there is no referral fee and everyone is doing it for the good of education. But, would you teach someone when he benefits from you and you do NOT make anything out of it?<br />
<br />
Well, it is very rare that this could happen. Nonetheless, I can do it for close to free.Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-87582230003751361262018-10-07T20:00:00.002+08:002018-11-21T10:59:31.069+08:00"All that glitters is not gold"Q.<br />
All that glitters is not gold. Small or big firm, which is better for Estate Agency Practice?<br />
<br />
A.<br />
This is a famous proverb in English, meaning - the attractive external appearance of something is not a reliable indication of its true nature<br />
<br />
This is the same question when one is asked to join a big corporation or a small firm, which is better? A big firm glitters? A small firm looks weak and vulnerable.<br />
<br />
Being an employee, you would think that Small Firm would not pay the money. Big firm have advantages like better salary, annual leave, room to grow (can be disputable) and hierarchy for promotion.<br />
<br />
However, let us put those elements aside. We just concentrate on the business operation itself, not about employment issues.<br />
<br />
Big firm of estate agency practice like Knight Frank, Rahim & Co and Henry Butcher have a good spectrum of specializations. They are like supermarket of real estate including Valuation, Estate Agency, Property Management, Consultancy and Tender or Auction. They are like Medical Specialist Center, with various disciplines of sub-specialties. They are high volume and high cost of operation. In certain aspects, they pay good salary for high positions, and they will not pay a single sen less on your taxes or EPF.<br />
<br />
So, you can see that their structure is hierarchical and volume of business is also enormous. On the other hand, smaller practitioners of Estate Agencies are mainly like GPs, or even like pharmacies. They mobilize their activities in local geographical area and work with cost saving and in small scale. They might have very unstructured hierarchy, everyone operates on his own, be responsible for his own cost and expenses. The salary is non-existent as most Negotiators are engaged on a "Contract for Service", where each one is a "contractor" of his firm.<br />
<br />
On the business front, which will garner more customer? The question is about what bottom line you are looking at.<br />
<br />
For retail business, most big firms are not so involved. They are more into Corporate Sales - building which are in hundreds of millions. Small apartment of 800 sqf they are not so interested. Let us put corporate sales aside, among the agencies which do retail sales - subsale and developer sale, does size matter?<br />
<br />
Size does matter when it involves developer sales. It does not matter when it is subsale. Hence, when it is about image and professionalism, it will not depend on size that much. It depends on quality of service. On the contrary, buyer or seller would be worried if the cost (commission) will be exorbitant to sell their small property. So, big firm usually would not undercut small firm in the retail subsale market. It is too small for them.<br />
<br />
Among the competition in the subsale market, agency firms try to outdo each other by claiming that their team is bigger. It appears that bigger team means better performance. However, I beg to differ.<br />
<br />
The listings are concentrated among a few internet sites - Mudah.my, iProperty.com, Propertyguru, etc. So, general public will not go to firm website to see the listings. So, big or small firm listing does not matter much. Indeed, a REN with 10 listings or a REN with 100 listings, to a person who sells or buys property once in a lifetime, it really does not make significant impact.<br />
<br />
Probably, his choice would be a firm with 10 RENs rather than a firm that has 100 RENs. We do not know. It is individual choice. However, when his property is difficult to sell, then he would look for concentrated attention. He will not look for a big firm. Unless, the big firm have lots of buyers. Is that true of the big firm?<br />
<br />
When I come to this industry, I thought that big firms will have investors who follow them over time. They are the land bankers. They are the big bosses of developer firms. So, they will buy from you anything with no question asked. They are so rich!<br />
<br />
On the contrary, big firms who have all these investors will only buy from you if you are desperate. They are not stupid. They are smart investors, or "sharks". Therefore, when you want to sell your property, it might be good to list them with medium or smaller firm. They will likely give you more attention and find you a genuine buyer who buy your property to stay rather than to speculate.<br />
<br />
Truly, at this time of downturn, who on earth - investor or not, will buy to speculate? There is nobody to speculate with! So, small firm will survive better during this slow time as they rely on genuine buyer and tenants. Big firms would not be interested in small tenancy. They only target expatriates or corporate clients. Thus, during the low period, there will be no business as big corporate appointments are put on hold!<br />
<br />
The next article is about joining a big "MLM" real estate firm. It will be interesting to see...<br />
<br />Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-88157910960240643752018-07-13T06:52:00.001+08:002018-07-13T07:04:07.721+08:00REA license is no more "VALUABLE"Q.<br />
People say “Negotiator” same la with “Agent”. There is no financial differences with both making good money! Why study so hard to pass the Estate Agent Examination?<br />
<br />
A friend asked me:<br />
<br />
“I heard from one of my negotiator friend.. he said the rea license not as "valuable" as we think.. how true is it actually?”<br />
<br />
This question is very hard to answer. It is individual expectation of what is becoming a real estate person.<br />
<br />
It is like “There are plentiful doctors, there is no more money making to become a doctor?”<br />
<br />
Two parts of this question I must emphasize:<br />
<ol>
<li>The profession of Estate Agency Practice. </li>
<li>The viability of the trade/profession. </li>
</ol>
<br />
Although, they do NOT really mean one thing, they are linked. The balancing act is the part we need to discuss.<br />
<br />
A Negotiator can actually practise both parts. YOU DO NOT NEED TO BE A REA! Why?<br />
<br />
Because “Negotiators” are employed (or engaged) to assist the REA in estate agency practice - S.22C (2A) of VAEP Act, 1981.<br />
<br />
That means if you imagine that the REA is invisible, the Negotiator basically runs the whole business. In many agencies, the Senior Negotiators are given their own sales team to run the business. You can have a Negotiator led Sales Team bringing business more than an entire agency in some successful modals. In fact, in today’s social media, their Senior Negotiators are not even running the show - it is the celebrity “Consultants” who are running the business. These people are not even Negotiators! Why? Because selling without boundaries is the way to bring business. And, being a REA or Negotiator, you cannot simply say anything you want! The Board has a set of ethics and conduct to follow.<br />
<br />
So, the profession of estate agency practice is tainted with many “consultants”, and yet nobody really can do anything about it. And, why is this so? It is because the real estate industry is layered with a cream of greed! People are motivated by wealth and prestige. People swamp around celebrity “consultants” mimicking their so called “successes” in the quest for wealth. “Dato’ so and so, the Guru of Property Investing”.<br />
<br />
The reason why some of these “XYZ Consultancy” company or “Guru” are tagged with Negotiator or REA is because they are more wealth waiting for them! If a client wants formal dealings, they will satisfy them to go to an agency firm. If the client does NOT need this formal dealings, they just sort out the deals direct with vendor or developer. Developer or vendor do NOT mind going through them because they sell at good price and fast! Selling with “this cannot say, that cannot say” will have difficulty in getting a buyer, right???<br />
<br />
After all, the client wants good product and they have convinced them of the goodness in them. As for getting the clients into complication, hello!? Didn’t I say it is “potential future return”? I DIDN’T promise “anything”!<br />
<br />
If a client were to lodge a complaint, they will push the agency firm in front of them and say that the dealing was legitimate as it was handled by the Negotiator or REA. They push away their “Consultancy” works by saying “we just give advice” nothing else.<br />
<br />
Therefore, whether a doctor is a good or bad doctor, taking a medical leave really does NOT matter who is a good or bad doctor. Estate Agency Practice is like that!<br />
<br />
Your employer would not normally question the legitimacy of your medical leave as long as it is certified by a medical doctor registered with the Malaysian Medical Council. So, similarly your real estate client would normally not mind if it is a good or bad REA firm, as long as it is a good property or a good buy. <br />
<br />
Only when he does NOT get a good deal, he will question this firm. BUT, it is usually too late by then. The consultant will say “Well, in any investment, there is risk! We are sorry that it happened. We did NOT want that to happen as much as you do!” and probably end with a “We are sorry, but do come back for a better deal!”<br />
<br />
Ref:<br />
S.22C (2A) Valuers, Appraisers and Estate Agents (Amendment) Act, 2017.Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-14825377457203156202018-07-01T07:22:00.001+08:002018-07-06T12:48:30.307+08:00Agency vs Employment vs Marriage Part 2 of 2Q.<br />
Should you decide what to say? Or your boss decides for you?<br />
<br />
A.<br />
Agency can be quite confusing when it is masked with employment or even marriage. The simplest thing to understand agency is two parties (can be individual or company) come to an agreement to do something with the authority of the principal entrusted to his agent in dealing with a third party. The third party is taken as directly contracted with the principal as he deals with this agent.<br />
<br />
So, when a salesperson is promoting the product of his company, he is entrusted to sell this product as if the company sells directly to the customer. His delivery of the information is taken as if it is from the company. However, he cannot contract the company to buy stock or even a tin of milk for cafeteria as supply for all staff. Even when he is a financial controller of the company, he still cannot sign a contract of sale and purchase of a plot of land. That is the authority of the board or Chief Executive Director of the company.<br />
<br />
Husband and wife, in the context agency really does not mean much. Husband who is the owner of the company, might not be the true principal. Rather, the wife who is running the business would have ostensible or apparent authority no matter what.<br />
<div>
<br />
The question of who listen to who is rather subjective in such context. An employee cannot be acting without authority from the employer. A wife can act irrespective of whether her husband in fact, had authorized her. So, in the most strict sense, estate agency stays in between these two extremes. You have more authority to the employee but less than a wife.<br />
<br />
Take for example, developer's staff will say things like this to customer:<br />
<br />
During road show, company promoting Condo with special bonus! Below is a conversation:<br />
<br />
Customer: Wow, so good la! Why give so much? Must be unable to sell la!<br />
<br />
Employee: No la! We give special cash bonus in promoting our special launch, not because we have unsold units.<br />
<br />
Customer: Must be cannot sell only give so much rebate and bonus la! I read in Star Newspaper so much condo unsold, 34,000 units completed cannot sell! MUST be too expensive la!<br />
<br />
Employee: Where got expensive! We give rebate and bonus! Not expensive la!<br />
<br />
The employee have to follow the instruction of the company to say the company's sales pitch. Whereas, as an agent, the agent can say what is best for his professional knowledge. For example:<br />
<br />
Customer: Wow, so good la! Why give so much? Must be unable to sell la!<br />
<br />
Agent: Sir, you are quite right. Actually, the whole property market is seeing a glut. So, developers are giving special prices to survive this difficult time! Our company do have unsold units and we are doing special promotion now, to echo your point, sir!<br />
<br />
Customer: Must be cannot sell only give so much rebate and bonus la! I read in Star Newspaper so much condo unsold, 34,000 units completed cannot sell! MUST be too expensive la!<br />
<br />
Agent: Sir, you do follow the market closely, so you really know the situation well! However, you should take this opportunity to enjoy all the rebate and cash bonus, right? After all, the market will recover soon, and you will make good investment!<br />
<br />
The distinction between an employee and an agent in such circumstances is quite blur. The employee can be given the training to say what the agent said. However, it would have to be approved by the management. Whereas, the independent contractor - Agent is entrusted to sell the condo as in agency appointment. He being a professional, would have to deliver his value under the standard of code of conduct and ethics regulated by the profession itself. <br />
<br />
If he thinks it is unacceptable to his profession, he can reject the sales pitch. He could modify to his expectation of the standard or refuse to abide by the request of the principal who appoints him. In case of necessity in emergency, he can even decide on his own what is best for the principal without having to get approval!<br />
<br />
*However, such is the case, in today's situation of connectivity, one must call up the principal and get an instruction before deviating away from the original instruction. Or else, the principal might decide not to ratify the contract (s.149 Contracts Act, 1950).<br />
<br /></div>
Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-59994967159878069352018-06-30T10:44:00.000+08:002018-07-01T07:17:26.381+08:00Agency vs employment vs marriage Part 1 of 2Q.<br />
What is agency relationship? Is agency relationship like a marriage? Or is it like employee and employer relationship? What is the difference?<br />
<br />
A.<br />
For reading into agency please go <a href="https://www.shsu.edu/klett/agency%20et%20al.htm" target="_blank">here for a good summary</a>.<br />
<br />
This is a tough question to answer. For, there are a few issues listed below:<br />
<br />
1. no perfect condition for drawing a margin of who's who in the relationship.<br />
2. a wide range of what is authorized or allowed to do, and what is not.<br />
3. situations when circumstances may seem special.<br />
<br />
In a bigger picture, agency relationship happens between employee and employer. In the circumstances when an employee is stationed far away from the center of command, he can even be an independent contractor! So, agency relationship in bigger scale can range from employee of a sundry shop to a contractor who is stationed in remote place of the earth. It can also be a wife who works in a sundry shop where her husband in name is the owner, but she calls all the decisions as if she is the real employer!<br />
<ol>
<li>Employer–employee relationship: An employer hires an employee to perform some form of physical service. An employee is not an agent unless the principal authorizes him or her to enter into contracts on the principal’s behalf.</li>
<li>Principal–agent relationship: An employer hires an employee and authorizes the employee to enter into contracts on the employer’s behalf.</li>
<li>Principal–independent contractor relationship: A principal employs a person who is not an employee of the principal. The independent contractor has authority to enter into only those contracts authorized by the principal.</li>
</ol>
<div>
<br />
All definitions suffer from inadequacies but essentially agency is defined as the relationship which arises where one person known as the agent acts for another known as the principal.<br />
<div>
<br /></div>
<div>
Through the acts of the agent, the principal and a third party may be brought into a contractual relationship. The agent may also have the power to dispose of property of the principal to a third party. </div>
<div>
<br /></div>
<div>
Generally the agent´s acts have such effect because the principal has authorized the agent to do the acts in question and the agent has agreed. The agent in a sense becomes an extension of the principal and is therefore capable of altering the principal´s legal position either by binding him to a contract or effecting a binding disposal of the principal´s property.</div>
<div>
<br /></div>
<div>
How agency relationship can contrast other types of relationship, for example like employment.</div>
<div>
<br /></div>
<div>
At common law, there are a number of relationships that resemble agency but may not have the distinguishing feature of being able to affect the legal position of another as in agency, e.g. servants/employees, bailees, trustees, etc. </div>
<div>
<br /></div>
<div>
For example, a servant or employee may be given specific tasks to perform which, though important, do not confer on the servant or employee any authority or power to bind the master vis-à-vis a third party. </div>
<div>
<br /></div>
<div>
A finance manager of a company may not be authorized to enter into transactions on behalf of the company that he or she works for. The finance manager´s role may simply be to ensure that the accounts of the company are kept up to date. </div>
<div>
<br /></div>
<div>
On the other hand, there are many employees who would have authority to bind their principals. A good example is the managing director of a company. As the officer of the company charged with the day to day running of the company, managing directors frequently have wide powers to enter into transactions on behalf of their companies.<br />
<br />
Hence, it comes to a scenario what I want to discuss. A company fired all their sales staff and appointed outside agency firms to manage their sales. This means the employer-employee relationship between the previous old sales team has changed to a different arrangement of agency appointments.<br />
<br />
The new agents under the agency firms are not paid a salary like the old employees. There was also no other sales identifications like company printed name cards, uniform or access name tag. The agents are stand-alone Negotiators or Probationary or Registered Estate Agents.<br />
<br />
They work on an appointment basis, for a duration of months, not years. Future appointments are dependent on further negotiation and terms. There is also no PERKESO (SOCSO) or KWSP (EPF) benefits with this arrangement.<br />
<br />
These agents get paid with a commission negotiated with the agency appointment. Only when a sale is made that a commission is paid. At times, it is paid by stages of the completion of sale. For example, upon signing of SPA, and followed by first draw down from the bank. The developer would not make commission payment until and unless it gets paid from the purchaser. That simple. If the terms are not attractive to the agency firm, it is okie, the developer will look for the next agency who will come to their terms.<br />
<br />
On the part of agency appointment, the agency firm stands as an agent, not an employee. There are advantages of such appointment:<br />
<br />
1. Agency firm can enter into a binding sales with customers even at its official address, and sales gallery with agency. Money can be collected and deposited into the Client's Account in the normal agency practice.<br />
2. At the premise of the company, customer can straight away enter into sale with the company without going through the agency. Money can be collected and deposited into the Company's Account in the normal manner.<br />
3. More agencies can indeed increase exposure and sales for the company as "sales centers" can be organized to promote the product of this company, not limiting to the office of this company alone.<br />
4. There is cost advantage as no salary commitment can mean significant saving.<br />
<br />
However, the disadvantages are:<br />
<br />
1. due to its arrangement as agents who are not employees, they have other commitments to other jobs. This can be conflict of interest.<br />
2. no culture or employee loyalty to the company.<br />
3. no consistent income (as depending of commission), there is insecurity and hence may not be committed.<br />
4. inconsistent in message delivery. The agents are diversified people, each with their own idiosyncrasies.<br />
<br />
AND,<br />
<br />
Legally they are not paid employee, so the where-about of their agents are hard to predict. What they say to the customer is also their own interpretation of the product. Unless a throughout training is being provided, these agents are guerrilla fighters. They fire bullets as and when they think is necessary, not really follow your set of rules.<br />
<br />
As they are not paid staff, they can detach from the company anytime they want. Their agency firm may be committed, but not the independent agents/negotiators. They do not hold any position or salary from the agency firm as well. In such case, they are like "Independent Contractors".<br />
<br />
It is not in the control of the company on what the agents are supposed to say. They can say things in their own interpretation, by their eagerness to sell the products. As long as there are sales, they claim their commission. No sale, no commission, they are not paid a single sen. Therefore, in their desperation for sale, they can promise anything to the customer. After all, after sales service is not their responsibility. In fact, they are not sure whether they can last that long!<br />
<br />
If the company finds it an over promise, the company has to turn down the sale. However, sometimes damages have already been done! In this respect, there are companies who will never outsource their sales team.<br />
<br />
In short, agency relationship is very wide in its effect and interpretation. There are a lots of inadequacies to this. Being an independent contractor, the company cannot dictate the method of how the agent carry out their daily activities. There are risks the company may end up with by over promising the clients using their independent contractors.<br />
<br />
Ref:<br />
http://estateagentexam.com/2015/04/compare-agent-and-principal-to-husband-and-wife.html/<br />
<div>
http://wps.prenhall.com/chet_cheeseman_paralegal_2/61/15831/4052842.cw/-/4052848/index.html</div>
</div>
</div>
Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-74057354256061704112018-06-18T11:51:00.000+08:002018-07-06T15:21:30.039+08:00Doctors versus Agents - What differences are there in the profession?Q.<br />
Wow, why so expensive you commission! You think you are a doctor?<br />
<br />
A.<br />
This idea was moulded when I sold the first property in a Road Show. Apparently, the perception of the public does not matter much with how young, old, experienced or newbie you are in the property industry. This is rather amazing to see as in most other profession, experience is the credential for winning a sale/bid.<br />
<br />
Take for example, a doctor in practice. He who is experienced and had been there for consistent practice would likely win patient load. Those who are new to practice or looks very young and inexperience will not likely to get crowd.<br />
<br />
Why it is not so for property sales?<br />
<br />
The major reason are:<br />
<ol>
<li>Buying property is not an everyday job, so you would not likely see an agent in a long time.</li>
<li>The profession does not have a distinction between who's who in the field. There is no difference between a senior negotiator compared to a junior negotiator.</li>
<li>The rules and regulation of practice do not differentiate a field agent from a sitting in the office agent. It also does not differentiate an agent with 1000 listing from an agent with 10 listing.</li>
</ol>
<br />
Now, let me illustrate a scenario with a doctor versus an agent. REN - Real Estate Negotiator. PEA - Probationary Estate Agent. REA - Registered Estate Agent.<br />
<br />
DOCTOR XYZ is a consultant paediatrician. This says a lot about a doctor, his specialty, training and years of experience.<br />
<br />
First - He is a paediatrician, which means he has to be a medical trained doctor first before he can specialize in paediatrics. That is at least 5 years of medical school, 2 years of housemanship, and 4 years of work as medical officer in Government Hospital/Klinik Kesihatan.<br />
<br />
Second - He is a paediatrician, which is a post graduate certification programme which likely took him 4 years of specialised training in a paediatrics setting (Master Programme in Malaysia - if MRCP around 3 years depending on how fast the exam was taken). At this stage, he would have at least 10 years of medical learning and 4 years of training in the field of paediatrics.<br />
<br />
Third - He is a consultant, which means after he has attained paediatrics specialty, he had 10 years of experience working as a paediatrician. This period of specialized work would enable him to see enough cases to be called a consultant. All in all, a 24 years of medical learning and experience. Minus the 5 years medical school, he has worked 19 years!<br />
<br />
AGENT ABC is a REN/PEA/REA. This says very little about an agent.<br />
<br />
First - Is he a broker? Yes. He is a Licensed Broker. Before he was accepted by his current firm to be a Negotiator (REN), he should have attended a 2 day Negotiator Certification Course. Probably he has no formal education about estate agency practice and picked up the job while on the job. He might have learned from others, or learned all by himself.<br />
<br />
Second - He is a PEA, which means he is a formally educated estate agent. Yet this formal education can be from various paths. He could be from a University/College (UM, UTM, UiTM, UTHM, TAR College or overseas Universities recognised by the Board). Or, from a part-time study from taking the Board Exam (LPPEP Estate Agent Exam). Lastly, he could be those who took the INSPEN Certificate Programme on Estate Agency which is a weekend class for those REN who aspire to become formally qualified.<br />
<br />
Third - He is a REA, which means he has been doing the job for a few years - REA would have completed PEA training of more than 2 years upon which they took and passed the Test of Professional Competence (TPC). This whole process would have taken at least 3 years. So, a REA can claim to have at least 3 years of field experience. Many a time, he could have more than 10 years of field experience.<br />
<br />
In real life, while a senior REN can be of 10 years of experience without actually completing any structured training. In delivering value, this 10 years REN is similar to a 10 years REA. Because there are lots of things you gain from the experience. This is like a senior GP can be as good as a Paediatrician engaging in child care. However, a GP cannot charge the fee of a Paediatrician.<br />
<br />
Thus, you can see there is no difference between a REN or REA in their job specialization. A REN or REA/PEA basically does the same thing. To a client, they are all the same. You cannot say a REA is more specialized than a REN or PEA. Similarly, you can go see a GP and get your pack of medicine similar to the medication from a paediatrician. No difference. The only thing different is the consultation charges. And, in fact many consultant paediatricians are charging similar fee to a GP!<br />
<br />
When a paediatrician markets his expertise, he claims his specialization. On the contrary, a GP (as experience as a paediatrician) cannot claim his expertise in child care. This is his professional liability, and while the outcome of treatment might be the same, the charges aren't.<br />
<br />
For estate agency practice, the charges are the same. Seeing a REN or PEA or REA has no difference. The maximum fee for a sales transaction is 3%, be it a REN, PEA or REA. Hence, a client would not see value in a REN, PEA or REA in terms of Fee payment. Only thing is REA is the highest recognition in the profession, and usually a REA would be an Sitting in Office Agent as he leads a whole team of REN/PEA and focus on big and mega deals. Or, he might just be claiming a profit sharing with the team, and enjoy his quality of life in air-conditioned room!<br />
<br />
To the general public, seeing a REN in the field only mean seeing someone who can answer his inquiries. There is no "problem" which requires "solution" in the like of illness when a child is seeing a paediatrician. Hence, there is no distinction of who is a good REN/PEA/REA.<br />
<br />
Unless you have a real "problem" in real estate, you would prefer to see an expert - REA. Other than that, anyone who could talk to you and make you delighted is a good Real Estate Sales Person.<br />
<br />
There is no distinction on who can deliver that "entertainment" be it a broker, an agent or just an entertainer.<br />
<br />
Ref:<br />
Own account.<br />
<br />Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-33303134918379626532018-06-11T16:18:00.000+08:002018-06-25T10:37:15.291+08:00Buying Property is like looking for book in libraryQ.<br />
Similarity of buying property to looking for a book in a library. Discuss and illustrate.<br />
<br />
A.<br />
Many of us remember going to the school library. For most, you probably had some experience with even bigger libraries like University Library. UKM has one of the best libraries in the region, and mind you, I never really go there to look for (Red Spot) books.<br />
<br />
This article is about who is who in real estate as compared to library. This will make you understand what is real estate industry, in particular the estate agency practice.<br />
<br />
The four parties in library are:<br />
<br />
1. Book seeker (potential reader or student)<br />
2. Librarian<br />
3. Library software system (library system)<br />
4. Books<br />
<br />
These are quite similar to estate agency:<br />
<br />
1. Purchasers/Tenants (similar to book reader/student)<br />
2. Estate Agents (similar to librarian)<br />
3. Software or Listing (similar to library system)<br />
4. Properties (similar to books)<br />
<br />
When you go to the library to look for material, you can do a few things:<br />
<br />
1. Randomly search the shelves.<br />
2. Use the catalogues or library system.<br />
3. Ask the librarian.<br />
4. Check the Book Return Bin (for those books just returned)<br />
<br />
There are a few things that will determine your selection of which library and what system to use for your best selection of books.<br />
<br />
What type of book/material that you are interested. (Type of property)<br />
How specific is the information that you are looking for. (Specificity)<br />
How extensive is the search which you require. (Time urgency)<br />
<br />
Therefore, imagine you need to look for a very specific book by a title or author, you would not go to every bookshelf and try and search for it, right?<br />
<br />
This is the same as when you have a budget and specific type of property in your mind, you can go to the listing, type in the selection and let the system search for your best fit.<br />
<br />
However, in most cases, your dream book by that particular author might not be available in the catalogue! So, what do you do?<br />
<br />
You turn to the librarian, who will suggest a similar but not the exact book which you are looking for. Let us use an example, a book on "Parenting your child", you cannot find the exact book, but there are many 'Parenting' books around. There may be some popular topics on parenting which suit you! Hence, the librarian might be able to assist you to arrive at a good title.<br />
<br />
Similarly, in estate agency, many are looking for properties, but unable to arrive at the exact fit. Hence, the listing might be able to shortlist some, and the estate agent can help you arrive at the correct (but not exactly similar) property of your needs.<br />
<br />
Ref:<br />
Own account.<br />
<br />
<br />Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com1tag:blogger.com,1999:blog-7622035499636353964.post-88991321850856042362018-05-28T11:54:00.001+08:002018-07-06T15:21:49.778+08:00100 days as Probationary Estate AgentQ.<br />
What do you say about the profession after 100 days as PEA?<br />
<br />
A.<br />
30th Jan, 2018 I got serious about doing the training in Estate Agency. At that moment of time, it was an urgency that I have been sitting around jobless for a month!<br />
<br />
I started on the 16 Feb, 2018. Now, it has passed 3 months and more than 100 days so I am writing up this article as a report card. May be it would be useful for those who choose to pursue this career and join me in this industry!<br />
<br />
In the first month of the job, I took it very easy as I did not have any leads. Truly, I was not desperate for listings. In my mind, I just wanted to learn slowly, learning the rope to be a better 'landlord'. I am used to the usual posting in Mudah.my. For years we have organised letting of our properties all by ourselves. If there is phone call, I would attend to it. Some stories I heard was to call up those telephone numbers in the banners when you bump into them in housing estates. Try to persuade them to give you listing... Or, even do co-broking (co-agency).<br />
<br />
I told myself: if I were to do what others (years of experience) are doing, I will not do better than them! Why rush into it? I need to craft out my niche. So, I started to do short postings in FB. Now, I am still doing it - <a href="http://facebook.com/thomassimys/">http://facebook.com/thomassimys/</a>.<br />
<br />
Quite luckily, I got some Doctor friends who wanted to rent out their apartments/condos. In this, I learned a lot about the process of letting and how payment are collected into client's account of firm. Thanks to my Doctor friends! Hence, I learned the professional process of engaging a tenant and maintaining professionalism in the screening process.<br />
<br />
Towards middle of Feb, we got an appointment with Ibraco Berhad - a renowned developer in Kuching - to act as their agent in all their sales. So, I was lucky to get start with project marketing which is part of the requirement for my Test of Professional Competence (TPC) 2 years down the line. We started the agency work in End March, with the launching of NOVA72 @ NORTHBANK on the 31st Mar - 1st Apr, 2018.<br />
<br />
Some weeks later, the developer took up sales gallery at the newly opened shopping complex - Aeon Mall. We rotate with another agency to stand duty at this venue and attended to public to promote the projects.<br />
<br />
As of today, I have managed to sell 3 units of properties by this developer. Meantime, I rented out 4 units of properties. Below are summaries of what I learned.<br />
<br />
1. Sequence of events in engaging a prospective tenant is important. This is contract law.<br />
2. Using client's account as a service of estate agency.<br />
3. Do and Don't in tenancy. Stamping and taking meter readings, handling over of vacant possession.<br />
4. Engaging with bank officers for prompt communication between all stakeholders.<br />
5. Open house and launches as crowd handling is crucial, invitation and advertisement.<br />
<br />
As a conclusion, estate agency business is somewhat challenged by the below conditions:<br />
<br />
1. Cost - most people cannot afford premium properties. Hence, successful closing is hard.<br />
2. Ultra short interaction between agent and prospects. Prospect only buy one property in a lifetime. This means an old agent/negotiator or newbie doesn't differ much unless specific knowledge is asked by the prospect*.<br />
3. Confidentiality as prospects would not review income level to strangers. Thus, trust is scarce.<br />
4. Urgency is rare. Most people are not in urgent need of investing or owning a property.<br />
5. Technical data - most people do not know about interpreting data/past trends or future trends.<br />
6. Differentiation is rare. One agent does NOT differ from another. So, all the same la!<br />
<br />
In the 3 months I have been in the field, I see the good demand for property in Kuching and that is a piece of good news at least. Young population is really taking the housing supply to the next level. The cost of property is also alarmingly high. Most local salaried man in Kuching cannot afford a house more than RM400,000. Average income per household is RM5k, so annual income of RM60k. This times 3 is RM180k - affordable home by Bank Negara Malaysia standard.<br />
<br />
On the other hand, there are some very well to do people in Kuching who could buy property beyond millions. Despite being rare, this segment of the market is served by senior RENs and agency bosses, including the developer themselves.<br />
<br />
As a whole, this industry is a growing industry and it is now more professionally run than years before. People do appreciate the knowledge and significance of property investment thus, a career in estate agency practice has a bright future in Kuching.<br />
<br />
*This ultra short interaction posts another topic of discussion which I will write later.<br />
<br />Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-27801756406722785712018-03-21T10:36:00.001+08:002018-07-06T16:16:38.686+08:00New VAEP Act for Property ManagersQ. (Also posted in EstateAgentExam.com)<br />
<br />
What is new about the VAEP Act 1981 on Property Management?<br />
<br />
A.<br />
Some areas of changes have been made to estate agency practice. Please see my earlier post <a href="http://justletak.blogspot.my/2018/03/amendment-to-vaea-act-1981.html" target="_blank">here for VAEP Act amended 2017</a>.<br />
<br />
There is a totally new part called Part VB for Property Managers.<br />
<br />
Actually, the original law had only Part V for Valuers and Appraisers. Then, as the estate agents were incorporated, it was inserted Part VA. Now, Property Managers is inserted as Part VB.<br />
<br />
On a whole Part VB spells out the definition of Property Manager, registration of property managers under the Act, the qualification and registration of the probationers and practice by firm, etc pretty much similar in standard of requirement like that of Valuers and Estate Agents.<br />
<br />
As there is critical needs of the profession* hence, the Board is introducing the liberalization exercise so that more property managers can be registered and regulated under the Act. There is a 12 month period where any practicing PM can get themselves registered without having to sit for examinations. Details of the conditions please refer to the Amended VAEP 1981 or LPPEH website.<br />
<br />
Here, what is important is the scope of Property Management.<br />
<br />
In the new Part VB, there is a S.22I which has this spelled out:<br />
<br />
S.22I (2) The property management practice referred to in subsection (1) includes the following:<br />
<br />
(a) enforcing the terms of leases and other agreements pertaining to the property;<br />
<br />
(b) preparing budgets and maintaining the financial records for the property;<br />
<br />
(c) monitoring outgoings for the property and making payments out of the income from the property;<br />
<br />
(d) advising on sale, purchase and letting decisions;<br />
<br />
(e) advising on insurance matters;<br />
<br />
(f) advising on the opportunities for the realization of development or investment potentials of the property;<br />
<br />
(g) advising on the necessity for upgrading the property or for the merging of interests;<br />
<br />
(h) managing and maintaining the building and facilities attached to the building; and<br />
<br />
(i) making or checking of inventories of furniture, fixtures, trade stocks, plant or machinery, or other effects.<br />
<br />
Similar to S.22C on Restriction on Estate Agency Practice, S.22J is specific on Restriction on Property Mangement Practice.<br />
<br />
S.22J (2) Paragraph (1)(b)# shall not apply to owner of any land, building and any interest therein who manages such land, building and interest.<br />
<br />
#(1)(b) act as property manager;<br />
<br />
Which means the profession of property manager is regulated to the below conditions:<br />
<br />
Unless registered as a Property Manager,<br />
<br />
(a) one cannot call himself a "Property Manager", "Managing Agent" or the equivalent thereto...<br />
<br />
(b) act as a property manager<br />
<br />
(c) carry on business or take up appointment or engagement as a property manager<br />
<br />
(d) display any signboard or poster, or use, distribute or circulate any card, letter, pamphlet, leaflet, notice or any form of advertisement, implying...<br />
<br />
(e) undertake for a fee or other consideration any of the work enumerated in S.22I (2) above,<br />
<br />
(f) be entitled to recover in any court any fee, ...<br />
<br />
The Register for Property Manager is created to be Part IV whereby Part I (Valuers), Part II (Appraisers), Part III (Estate Agents) and Part IV (Property Managers).<br />
<br />
As it is to preserve the influence and positions of the Valuers and Appraiser, the new amended VAEP allows Valuers and Appraisers who were already in the Part I and II of the register be entered into Part IV. This simply means Valuers and Appraiser who are existing as of the new amendment are automatically property managers as well.<br />
<br />
This is covered in S.22F of the VAEP Act 1981.<br />
<br />
S.22F Registration of property managers<br />
<br />
(3) Any registered valuer or registered appraiser who, immediately before the coming into force of this Part, had his name entered under Part I or II of the Register shall, upon the coming into force of this Part, be entitled to have his name entered under Part IV of the Register without payment of any fee.<br />
<br />
However, it is not so easy for Estate Agents. In Subsection (1A) of Section 22B, no registered estate agent shall carry on property management. Nevertheless, subsection (2) has some allowance that a registered estate agent, if approved by the Board, can practice property management under certain conditions.<br />
<br />
Now, in the amended Act 2017, the subsection (6) under S.22F (Registration of PM) is included as below:<br />
<br />
(6) Any registered estate agent shall be entitled to have his name entered under Part IV of the Register if before the date of the coming into force of this Part he was permitted to undertake property management as specified in S.22B (2).<br />
<br />
Which means, if a registered estate agent was previously allowed to practice Property Management by certain condition, he is now allowed to be a fully Registered Property Manager in Part IV.<br />
<br />
As for the liberalization exercise, anyone who has been practising prior 12 months from the date of the coming into force this Part for registration (S.22F), shall be entitled to have his name so registered if conditions are fulfilled.<br />
<br />
How to qualify?<br />
<br />
S.22H which is a mirror of S.22D (EA) and S.18 (V), spells out the qualification to be registered as PM. Similarly, there are two ways, one is by having a degree recognized and another by passing the board Property Manager Examination.<br />
<br />
The Act mentions about the probationer called Probationary Property Manager, who is required to obtain the practical experience and to pass the Test of Professional Competence prescribed by the Board or any equivalent (RISM). There is however, no mention of the length of practical experience like the case of PV S.18 (3) and PEA (S.22D (3) as this is specified in the VAEA Rules, 1981.<br />
<br />
At the time of writing, I have not read the new VAEP Rules, 1986 so I do not know how many years is the requirement of practical experience for PPM. I would assume it is 2 years like that of PEA.<br />
<div>
<br />
<div>
<div style="text-align: center;">
***********************************************************************</div>
<div>
<br />
*Critical need of property managers. Refer to the article "Property managers given a year to register with BOVAEP" published in Malaysian Reserve on 12 January, 2018, extracted below.<br />
<br />
She (Deputy DG Dr Zailan Mohd Isa - Valuation and Service Department) said currently 5,000 professionals in the business are still not registered.<br />
<br />
“We want to ensure that after the timeframe given, all of them would conform to the Act,” Zailan said, adding that only 1,200 practitioners are already registered.<br />
<br />
BOVAEP board member Kamaruzaman Jamil said that unregistered practitioners who fail to comply within the stipulated timeframe can be fined up to RM25,000 and barred from practising within the industry.<br />
<br />
“The process to be part of the Act over the 12-month period would also be significantly flexible compared to the normal procedures, which are more stringent.<br />
<br />
“I’d like to urge practitioners to come forward and be part of the Act to avoid any unwanted circumstance,” he said.<br />
<br />
Last year, only 10 claims on mismanagement and malpractice by registered property managers were directed to BOVAEP, while 116 cases involved illegal practitioners.<br />
<br />
To date, at least 19,000 strata schemes are available throughout Malaysia, benefitting 7.5 million people, or 30% of the total urban population.<br />
<br />
<br />
Ref:<br />
Valuers, Appraisers, Estate Agents (Amendment) Act, 2017.</div>
</div>
</div>
<div>
https://themalaysianreserve.com/2018/01/12/property-managers-given-year-register-bovaep/</div>
<div>
<br /></div>
Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-51578157024312741242018-03-19T21:18:00.002+08:002018-07-06T15:24:22.323+08:00Real Estate Agency Service and GST Q. (Also posted in EstateAgentExam.com)<br />
<br />
Why do I have to pay for GST to the Agency which I appointed to sell/rent my house?<br />
<br />
A.<br />
Little known fact about GST in Estate Agency Practice.<br />
<div>
<br /></div>
<div>
Some people try to save on commission when dealing with agents and brokers. Apparently, some discounts are given being “illegal”. </div>
<div>
<br /></div>
<div>
The fact that if he is illegal, there is no GST. You save the 6% GST. </div>
<div>
<br /></div>
<div>
How I wish this could be true in real life! </div>
<div>
<br /></div>
<div>
Who pays for GST? </div>
<div>
<br /></div>
<div>
He who appoints the representative, because he receives the service of estate agency. </div>
<br />
That is most of the time the owner. And, the fact that the representative who does not collect GST is nothing to do with its legality in its profession. Simply, it means the collection of GST has nothing to do with whether he is illegal or a legal agent. This is little known.<br />
<div>
<br /></div>
<div>
Let me give the example of “prostitution” as a service. It is illegal. However, a “prostitute” still need to pay tax! So, irrespective of who this representative is (being a illegal broker or registered agent), the duty to pay GST is not about his legality, but that a service had been rendered. </div>
<div>
<br /></div>
<div>
Indeed, if you are an owner, and you don’t pay GST to an agent, the agent has to pay it out from his commission received. That is “GST inclusive”. So, engaging an illegal broker, it is “GST inclusive”, that is all. If he ever be caught, he is himself in deep trouble. And, if that is the choice, you can mention it to the registered agent, he might just waive it for you as well!</div>
<div>
<br /></div>
<div>
Ref:</div>
<div>
Own account.</div>
<div>
<br /></div>
Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-83744198989473721262018-03-19T21:14:00.000+08:002018-07-06T15:24:39.791+08:00Real Estate and GSTQ. (Also posted in EstateAgentExam.com)<br />
<br />
How is GST imposed on properties, especially Commercial Property in Malaysia?<br />
<br />
A.<br />
There are two parts to this. <br />
<ol>
<li>One is the GST on the service. </li>
<li>Another is the GST on the Goods Sold. </li>
</ol>
<div>
<br />
One is service and the other is the goods - the property. They are two separate things. </div>
<br />
First, GST on services rendered. It has been discussed in a separate post <a href="http://justletak.blogspot.my/2018/03/real-estate-agency-service-and-gst.html" target="_blank">here</a>. <br />
<br />
Today is about GST on the Real Estate as "Goods", not "Services".<br />
<br />
There are two categories, one is residential and another is commercial/land. Residential property sale and lease is exempted. Commercial/land above RM2 mio would require the payment of GST.<br />
<br />
The other criteria are:<br />
<br />
Based on the previous DG’s Decision, any individual person is considered as carrying out business if make a supply of more than two commercial properties or commercial land exceeding 1 acre and is liable to register with GST if his total annual taxable supply exceeds RM500,000.<br />
<br />
So long as you supply less than three commercial properties or commercial land not exceeding 1 acre, it would be treated as not carrying out business even if the sale is more than RM500,000 in a 12 months period.<br />
<br />
However, the above mentioned amendments added one more criteria (i.e.commercial property or commercial land worth more than RM 2 million ringgit at market price) to determine when a person is considered as carrying out business of supply of commercial property.<br />
<br />
Any individual that supplies commercial property or commercial land worth more than 2 million ringgit at market price after 28 October 2015 shall liable to register for GST. Any late registration will be subject to penalty based on number of days late which capped at RM20,000.<br />
<br />
However, the seller has to collect, not the agent or the lawyer or the purchaser. Next is the issue of input and output GST. Output tax is the RM6 of RM100 paid by purchaser. Input tax is the part you can claim back from Director General if you have paid for GST when acquiring the goods earlier on. If you had paid RM4 as GST for this property, you just need to pay the remaining RM2 for GST on this sale.<br />
<div>
<br /></div>
<div>
According to the latest “GST General Guide” (amended on 25 January 2017), the registered person may be allowed to claim input tax on the goods he holds at the time of registration based on the approved amount by the Director General.<br />
<br />
<b>NEXT is about Commercial RENTAL.</b><br />
<br />
Yes, GST is imposed on rental collection for commercial properties. GST is charged if</div>
<div>
<ul>
<li>he is supplying any lease, tenancy, easement, licence to occupy or rent ; AND</li>
<li>his annual turnover for such supply has exceeded the prescribed threshold in the period of 12 months.</li>
</ul>
<br />
The threshold is RM500,000.<br />
<br />
Ref:<br />
<div>
https://www.3ecpa.com.my/taxation-and-gst/gst-and-commercial-property-in-malaysia/<br />
<br /></div>
</div>
Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-34316589047958559722018-03-17T14:02:00.003+08:002022-10-25T15:02:20.945+08:00Amendment to VAEA Act 1981 that affected EAPQ. (Also posted in EstateAgentExam.com)<br />
<br />
What are the main CHANGES in Valuers, Appraisers, Estate Agents and Property Managers Act 1981 (amended 2017) that affect Estate Agency Practice?<br />
<br />
A.<div><br /></div><div>Refer to updated write up on major changes to VAEP Act, 1981 at the link below:</div><div><br /></div><div><a href="https://estateagentexam.com/2018/06/amendment-veap-act-1981-tpc-law-q1.html/">https://estateagentexam.com/2018/06/amendment-veap-act-1981-tpc-law-q1.html/</a></div><div><br />
The piece of legislature VAEA Act 1981 was amended and passed in Dewan Negara on 21 August, 2017 to be called VAEP 1981. The Bill that enabled it was VAEA (Amendment) Act 2017, and come to force on 2nd Jan, 2018.<br />
<br />
*The Act — now known as the Valuers, Appraisers, Estate Agents and Property Managers Act 1981 — was passed last October and gazetted on Jan 2, 2018. It was previously known as the Valuers, Appraisers and Estate Agents Act 1981. The main change is the inclusion of Property Managers as a NEW REGULATED PROFESSION under this ACT. Read <a href="http://estateagentexam.com/2017/05/what-is-property-management.html/">more on Property Manager here</a>.<br />
<br />
According to the report, there are currently 5,000 professionals in the business are still not registered.<br />
<br />
“We want to ensure that after the timeframe given, all of them would conform to the Act,” Zailan said, adding that only 1,200 practitioners are already registered.<br />
<br />
BOVAEP board member Kamaruzaman Jamil said that unregistered practitioners who fail to comply within the stipulated timeframe can be fined up to RM25,000 and barred from practising within the industry."<br />
<br />
However, this article is about the changes that affects the Estate Agency Practice. The key points in the amendment which affects the Estate Agents are below:<br />
<b><br /></b>
<b>1. Better Definition </b><br />
<br />
S.2 Interpretation<br />
<br />
"Estate agency practice" has been deleted and inserted this definition in the key Section 22B Estate agency practice.<br />
<br />
S.22B Estate agency practice<br />
<br />
(1) ... no change<br />
<br />
(1A) A person undertakes estate agency practice if he acts as an agent, or holds himself out to the public or to any individual or firm as ready to act as an agent, for a commission, fee, reward or other consideration -<br />
<br />
(a) in respect of any sale or other disposal of land and buildings and of any interest therein;<br />
<br />
(b) in respect of any purchase or other acquisition of land and buildings and of any interest therein;<br />
<br />
(c) in respect of any leasing or letting of land and buildings and of any interest therein;<br />
<br />
(d) in making know of the availability of land, building, or any interest therein for such sale or disposal, purchase or acquisition, or leasing or letting referred to in paragraph (a), (b) or (c), as the case may be; and<br />
<b><br /><br />2. Included tenancy administration as NEW area</b><br />
<br />
[NEW TO THE ACT]<br />
<br />
(e) in respect of any tenancy administration including rental collection, payment of outgoings, arrangement for minor repairs and handing over and taking over the possession of a property of any land and buildings and of any interest therein.<br />
<br />
<br />
<b>3. The word "Consultant" is now included</b><br />
<br />
In S.22C - Restrictions on estate agency practice, a new term is added to the restricted list of terms used to the profession.<br />
<br />
This is particularly crucial as in the industry, many unlicensed brokers or sales personnel disguise themselves under various investor groups who call themselves "Real Estate Consultants" or "Real Estate Agency Consultants".<br />
<br />
(1) No person shall unless he is a registered estate agent and has been issued with an authority to practise under section 16 -<br />
<br />
(a) practise or carry on business or take up employment under any name, style or title containing the words "Estate Agent", "House Agent", "Property Agent", "Land Agent", "House Broker"...<br />
<br />
"Real Estate Agency Consultant" <br />
<br />
or the equivalent thereto, in any language or bearing any ...<br />
<br />
<br />
<b>4. Position of NEGOTIATOR</b><br />
<br />
This has been much delay. The role of REN has never mentioned in the Legislation before and I have written article on this issue - see <a href="http://estateagentexam.com/2014/09/agents-agent-2.html/">Agent's agent here</a>. So, this new inclusion has put the foothold of NEGOTIATOR as a part of the LAW! Therefore, it would be something permanent in the future!<br />
<br />
**My earlier prediction that the role of NEGOTIATOR will be replaced with increased PEAs - is now debunked.<br />
<br />
Now, let us see how it is added to the ACT.<br />
<br />
S.22C Restrictions on estate agency practice<br />
<br />
(2) Notwithstanding subsection (1) -<br />
<br />
[NEW SUBSECTION]<br />
<br />
(2) (d) a negotiator may assist the registered estate agent in the estate agency practice.<br />
<br />
Which means, despite saying that Section 22C (1) the restrictions, there are some exceptions to this estate agency practice, see <a href="http://estateagentexam.com/2015/04/exceptions-to-estate-agency-practice-s-22c.html/">Exceptions to Estate Agency Practice here</a>.<br />
<br />
This includes:<br />
<br />
(2)(a) Owner himself<br />
<br />
(b) licensed auctioneer,<br />
<br />
(c) holder of Power of Attorney, and<br />
<br />
now (d) Negotiators (newly added).<br />
<br />
However, the wording used exactly is:<br />
<br />
"assist the REA in Estate Agency Practice" which means it is NOT that a Negotiator can practice on his own.<br />
<br />
This subsection (2)(d) is further given definition of "Negotiator" as in a new subsection of (2A) below.<br />
<br />
(2A) For the purpose of paragraph (2)(d), "negotiator" means a person who is employed by a registered estate agent to assist him in the estate agency practice.<br />
<br />
Lastly,<br />
<br />
<br />
<b>5. FOREIGNER can practice if qualified</b><br />
<br />
S.22D Qualifications for registration of estate agents and probationary estate agents.<br />
<br />
(1) to (5) defined what are qualification for registration, and (5) has been removed.<br />
<br />
<strike>(5) A person who is not a citizen or permanent resident of Malaysia shall not qualify for registration as an estate agent or as a probationary estate agent ...</strike><br />
<br />
Other less important amendments are:<br />
<br />
The use of "Registered Probationers" to include "Registered PV, PEA and PPM".<br />
<br />
Ref:<br />
Valuers, Appraisers, Estate Agents (Amendment) Act 2017<br />
<div>
https://themalaysianreserve.com/2018/01/12/property-managers-given-year-register-bovaep/</div>
<div>
<br /></div>
</div>Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-69288632934509813752018-03-10T16:30:00.002+08:002018-07-06T15:25:15.252+08:00What if everyone is fighting over listing?Q.<br />
Imagine that the number of PEA in your area increase 2 folds! What would you think will happen?<br />
<br />
A.<br />
The Board won't simply pass you out as a REA! This is a fact, as the yearly passing of REA in Malaysia over the last few years had been around 50-70 per year.<br />
<br />
Every year there will be many PEA passing out from the examinations. Firstly, there are internal route from UCSI, INSPEN, IMPERIAL, TAR COLLEGE, etc. Next, there are those from UiTM, UTM, UM and UTHM not mentioning those from Overseas. Other than the formal classroom style studies, there are also many who qualify through the tough Board Examination - like you and me.<br />
<br />
Base on the number of today (08 Mar, 2018) and that of 06 Mar, 2015 from LPPEP Website:<br />
<br />
--------Today 2018----------2015<br />
PEA ------ 984---------------505<br />
REA ----- 2074--------------1862<br />
<br />
Let us look back at earlier readings (06 Mar 2015 - exactly three years ago).<br />
<br />
PEA - increase of 984-505 = 479<br />
REA - increase of 2074-1862 = 212<br />
<br />
Increase of PEA per year is 479/3 = 159 (round up 160)<br />
Increase of REA per year is 212/3 = 70<br />
<br />
If such trend were to continue, every year there will be 160 coming out as PEA, despite only 70 made to become REA. The net growth per year of PEA is 160-70 = 90!<br />
<br />
Every year 70 new REA, in ten years 700, which is added to the current 2074 = 2774.<br />
<br />
* In fact, if you use 70 new REA per year, you will arrive at around this number of REA from 1985.<br />
<br />
2018 - 1985 = 33 years.<br />
70 REA per year x 33 years = 2,310. Minus some who has passed away or ceased business, the number is quite near.<br />
<br />
Below is a table showing the likelihood of the scenario in 2028.<br />
<br />
--------Today 2018----------2028<br />
PEA -----984----------------1884 (up 90%)<br />
REA ----2074----------------2774 (up 34%)<br />
<br />
What would happen in 10 year's time? Would it be the same as today?<br />
<br />
IN SUMMARY:<br />
PEA will double to around 2,000 from the 1,000 now.<br />
REA will probably stay quite the same taking into consideration that most senior REA will be retired by then.<br />
<br />
This is because 1980's REA by then will be 60 plus years old and most of them will no more be actively around. This will easily take away some 50% of the numbers in the earlier years. Let us assume in the 1985 - 1995, there were around 700 REAs, that means half (350) will no more be around by year 2028.<br />
<br />
2,774 less 350 = 2,424.<br />
<br />
One agency average has 10 active RENs. That would see that market having 24,240 RENs at any time.<br />
<br />
Currently 27,017 is the Registered REN No on 09 Mar, 2018. We know that many RENs are just temporary and their continual presence in the industry is very sensitive to market ups and downs. Taking out 10% who are inactive RENs (27,000 less 10% - 2,700 = 24,300), our estimated number of 24,240 is quite near to the number now.<br />
<br />
Which means the future landscape of estate agency practice in Malaysia would most likely be similar as like today. The number of active RENs will probably stay around 25,000. However, the PEA will take higher number at 2,000. As there is no huge increase in REA, the number of approved REN per firm would be kept around there. Hence, there will be continual demand for license and the trade will still sustain the profession. However, the playing field might be different by then!<br />
<br />
The increase of PEAs will mean most RENs will be replaced. Like comparing REN to illegal brokers, the illegal brokers are not concerned about knowledge as compared to RENs. Similarly, comparing REN to PEA, the gap is about knowledge as well. Despite good and knowledgeable REN around, they are not so keen in higher standard of passing examination.<br />
<br />
Although knowledge may not be the essential item in daily transaction, a specialist in any field should have the competence more than required in its daily job. Take for example, a doctor should have the competent knowledge of delivering a baby despite the fact that he does not operate a labour practice in his clinic. A doctor in General Practice (GP) might have not been delivering baby for 20 years, but he MUST be competent when it is required of him!<br />
<br />
Thus, the higher number of PEA means most won't survive in the future if the profession is just about competing for listing. Future is cutting out the unnecessary fees. So, practitioners not adding value will have no place in this profession. But value of property won't come down. So, the future agent will earn good money by transforming property value into real profit for clients.<br />
<br />
Taking a step backward. The profession of Estate Agency is matching the principal to the client. In today's technology, the agent is the internet. Hence, buyers and sellers can interact directly without going through an agent. This is for sure and will be here to stay! Thus, if listing is the rice bowl, then fighting for listing will be the make or break decision for the agency. Do you want to be an agent cannibalizing on other's listing?<br />
<br />
The answer is YES and NO! Although there is regulation that forbids agents undercutting each other, and such bad faith may be lodged with the Board, in reality, enforcement is difficult. On the other hand, unless it is exclusive appointment, there is no regulation that another estate agent cannot represent the same principal.<br />
<br />
Rule 96 of the VAEP Rules, 1986 extracted below:<br />
<b><i>Seeking unfair advantage over other registered estate agents.</i></b><br />
<i><br /></i>
<i>(1) A registered estate agent shall not seek unfair advantage over other registered estate agents and shall conduct his business so as to avoid controversies with other registered estate agents.</i><br />
<i><br /></i>
<i>(2) A registered estate agent shall not make or participate in any promotional offers or give or participate in the giving of any incentives to secure business.</i><br />
<i><br /></i>
<i>(3) No registered estate agent shall claim that his services are better than that of other registered estate agents, whether in those words or in words of like effect, through any form of advertisement.</i><br />
<i><br /></i>
<i>(4) A registered estate agent shall not erect any signboard or other form of advertisement on the client's property if there is already such a signboard or advertisement on the property unless he has written authorisation from the client to do so.</i><br />
<br />
(No. 4 illustrates that principal can always appoint agents in <i>ad hoc</i> basis, and thus competing for listing is a natural process of business)<br />
<br />
Therefore, when a listing is being covered by more than one estate agent (<i>ad hoc</i> appointment), it is just natural market forces that would render who is a better agent. Or else, the working condition could very much be exclusive and other agents would work with listing agent in a co-agency. However, the trend is towards <i>ad hoc</i> agency appointment as nobody is confident enough to secure a buyer or tenant! Inevitably, the owner or landlord would want his property leased out or sold for a better price and quicker by more people promoting it (demand is higher when more people get interested in the property).<br />
<br />
So, the key word here is "DEMAND".<br />
<br />
Hence, the future agency would have to work on the Demand Side of the equation.<br />
<br />
How to determine where is demand, and how to create demand will be the make or break decision in the future!<br />
<br />
Ref:<br />
VAEP Rules, 1986.<br />
<br />Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-54901509947386096392018-02-28T19:51:00.002+08:002018-07-06T15:25:43.191+08:00DATA - GAP - VALUE INFORMATIONQ.<br />
Jack Ma said the future money is DATA. What do you think?<br />
<br />
A.<br />
Read further on:<br />
<br />
<a href="http://justletak.blogspot.my/2016/03/agency-positioning.html" target="_blank">Agent Positioning</a><br />
<a href="http://justletak.blogspot.my/2018/02/agent-positioning-2.html" target="_blank">Agent Positioning 2</a><br />
<a href="http://justletak.blogspot.my/2018/02/gap-barrier-or-opportunity.html" target="_blank">GAP - Barrier or Opportunity?</a><br />
<br />
In property business of estate agency, agent positioning is very important.<br />
<br />
Currently, almost all agents position themselves as "AGENT of SELLER". Simple, they want to be paid. No buyer is paying commission for a service.<br />
<br />
It is just like you buy a hand phone from a Brand Manufacturer, say Samsung, you pay a profit to the hand phone store.<br />
<br />
The hand phone storekeeper (agent) takes money from Samsung for a NEW GALAXY phone sold!<br />
<br />
Imagine you are a buyer of hand phone. Would you pay for a fee, asking a storekeeper to recommend you a phone? Then, you pay him a commission, and he sells you the phone at no mark up?<br />
<br />
No, right?<br />
<br />
Let us say a very ridiculous situation - you don't know a thing about hand phone. Yet, you need to buy one. So you appoint him to source for a phone within a budget. In this case, how much would it take for him to show you so that it is worth your fee?<br />
<br />
Hard to define right?<br />
<br />
That is about DATA.<br />
<br />
The big talk about DATA is that it can be used to sell things to the right audience, spot on and reduce error and quicken time channeling big revenue in sales. That is exactly what is described above. You pay him a fee for showing you the best phone for your fit. And, you buy that phone and don't waste your time anymore. The phone manufacturer will manufacture the very type of phone and don't waste the resources on other phones.<br />
<br />
In Real Estate, this is not so simple.<br />
<br />
Property DATA is hard to collect. The variables are many. If you include FengShui, it is even more daunting to imagine.<br />
<br />
However, with this DATA, a buyer will be attracted to select the right fit for his property. That is all that is needed, right?<br />
<br />
Then, it takes two hands to clap! You have the DATA, but what type of audience needs DATA?<br />
<br />
Simply put, not everyone reads the tech-magazine to buy a hand phone right?<br />
<br />
Therefore, you need to study your market segment. The more sophisticated investors, the business people who use property to make profit, operator of businesses, offices, plantation land, etc.<br />
<br />
It is less of the First Time Home Buyer group. So, know your segment!<br />
<br />
Therefore, the three things a successful estate agent should master are:<br />
<br />
1. Right mix of DATA.<br />
2. Right fit for the GAP.<br />
3. Right system (strategy) for long term sustainability.<br />
<br />
These are never easy things to achieve. It ranges from networking to computer skill, inputting of raw data, analytical mind to research and presentation of the right DATA to the right audience resulting in a perceived VALUE INFORMATION.<br />
<br />Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-47781181992432866632018-02-28T07:29:00.000+08:002018-07-06T15:26:37.879+08:00GAP - Barrier or Opportunity?Q.<br />
GAP between a buyer and a seller remains as challenges in closing a deal. Is it a barrier or an opportunity?<br />
<br />
A.<br />
In a normal relationship, GAP is not something that we long for. Generation GAP for example, is an obstacle in a parent-children relationship.<br />
<br />
Similarly, when GAP exists between two persons, business is hard to conclude and usually, it ends up as a fell out. Worse case scenario, they could become enemies.<br />
<br />
So, in normal circumstances, GAP is a barrier. NOT an opportunity. When there is GAP, there is bad news.<br />
<br />
In market place, when a GAP is apparent between a product and its market, it means the marketing unit has a lot more to do. BUT, isn't it the way we face everyday?<br />
<br />
Of course, your boss wants to achieve a higher sales target this year. There is a big GAP of expectation! Yet, it is a job which employs you! Without this GAP, you got no job!<br />
<br />
So, GAP exists everyday and everywhere, and it is because there is different level of expectations. Hence, there are big GAPs and small GAPs. This GAP exists, and therefore, effort in marketing and sales are to meet this expectations. It thus generates opportunity for employment.<br />
<br />
<b>Business Strategy</b><br />
<br />
Business environment never stay still. There are always changes. For example, the dynamics of pricing, competitors and economic conditions. GAPs are everywhere. So, organizations rise and fall, and yet time and tide wait for no man! So, organizations with better tactics and implementation will thrive.<br />
<b><br /></b>
<b>Strength and Weaknesses</b><br />
<b><br /></b>
Because of these GAPs and the limitation of one person to close all these GAPs, organization develop strategy to cater for the best fit as a TEAM. Therefore, organization studies its strengths and weaknesses They try to combat the GAP expectations by choosing a better battle to fight, saving resources and money. You just cannot win all!<br />
<br />
<b>Long term CORE COMPETENCE</b><br />
<br />
In so doing, the organization looks into its core competence. This may be one or two areas where there is better chance to close the GAP. The ability to close the GAPs (into the future) makes the system of the organization successful. This system is in time becomes "Culture" of the organization. The culture can include "Innovation" or "Resilience to failures".<br />
<br />
<b>Develop the technique to narrow the GAP</b><br />
<br />
Human cannot keep on battling the odds. That is why we develop machines. As GAPs keep on appearing, we develop computers. Hence, in the game of closing the GAP, better computerization should enhance the ability of human to sustain the winning strategy into the future.<br />
<br />
This system, is what is called "strategy" in business or "applications" in information technology or "set of working rules" in the backyard factory. It could deliver the core competence of the organization and takes it into the future. So, that comes with the analysis of competitors and other reasons why the business is not sustainable.<br />
<br />
Due to competitors, for example, VCD business.is replaced by internet. It has become a thing of the past as people move on to subscribing Internet TV through UNIFI.<br />
<br />
So, in Estate Agency, agents survive because of the GAP. Agents sell expertise in bridging the GAP. Yet, to sustain this strategy of "middle man", you need to ensure you can offer the value over a longer period of time versus your competitors.<br />
<br />
<b>Scenario</b><br />
<br />
Seller's agent - Increase value of seller's property. Buyers would be willing to part with their money to buy property of Seller because you show Value of the property to the Buyer. You closed the GAP.<br />
<b><br /></b>
<b>Sustaining the Value Proposition</b><br />
<b><br /></b>
Estate agent delivers comparison of properties so that Buyer has knowledge of the benefit in acquiring the property. Estate Agent explains about capital gain and rental yield. This knowledge must be able to sustain into the future. Thus, the competitor will not match the knowledge (Value) perceived to benefit the Buyer. When another platform is able to offer that value to the buyer directly (e.g. Internet database like Brickz), then the GAP is narrowed. There is no point a Buyer were to look for an Estate Agent to meet up with the Seller. The buyer can narrow the GAP himself. In this case, by Googling in the Internet!<br />
<br />
However, amidst all these, selling a property is much much better than say, selling a hand phone.<br />
<br />
People could learn about almost anything and everything about a brand of hand phone by Google. The buyer can just go online to buy the cheapest hand phone of that particular brand and model. The information is not a barrier in this case. It is a perfect competition - you get information about hand phone to almost 100% accuracy by Googling. In fact, you would know more in learning via Google than speaking to the salesperson of the hand phone store!<br />
<br />
However, real estate market is not in perfect competition. Nobody can be certain about value of a property and its potentials, or worse, its pitfalls. There is no two property exactly the same. So, there is always a GAP between a Seller and a Buyer. The Seller would want his property best you can think of. And, the Buyer would be worried that if it is over priced or worse, is it even a scam???<br />
<br />
To be able to offer VALUE INFORMATION, you will be better of than the another agent in the market. In this way, you will then be able to protect your business over a longer period of time.<br />
<br />
It is indeed, the ART of showing off your VALUE INFORMATION.<br />
<br />
Then, what is VALUE INFORMATION??? Read further here on <a href="http://justletak.blogspot.my/2018/02/data-gap-value-information.html?m=1" target="_blank">Data - Gap - Value Information</a>.<br />
<br />
<br />Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-77509159919534793532018-02-26T21:04:00.002+08:002018-07-06T15:26:59.582+08:00Agent Positioning 2Q.<br />
When everyone is doing the same, what can you do different from others?<br />
<br />
A.<br />
Read earlier post on <a href="http://justletak.blogspot.my/2016/03/agency-positioning.html" target="_blank">Agent Positioning here</a>.<br />
<br />
In a nutshell, an estate agent can offer his service in three main fronts.<br />
<br />
1. Represent the seller (that is what most agents would be and be paid);<br />
2. Represent the buyers (that is what most agents won't do);<br />
3. Academic and desk job in the research and publications.<br />
<br />
It is like when you take the example of a hand phone business. You become the seller of hand phone. It is your job to do the promotion because it pays you the income.<br />
<br />
You cannot (usually) charge the buyer a commission for recommending the brand of hand phone. You charge the supplier with the profit you earn in selling the brand. Of course, the profit is from the <u>buyer who paid for the phone.</u><br />
<br />
In between, there is the work of hand phone nerds who write review of hand phone in some tech-magazines. They are independent third party, who do not represent the buyer or seller. They are experts of their fields - however, due to their eagerness to be popular, they usually represent the voices of the readers (generally the buyers).<br />
<br />
Now, seeing it clearer in the example of hand phone, what can a hand phone businessman do to be different from others?<br />
<br />
There are generally three things he could do:<br />
<br />
1. Different segment for the handphone (user);<br />
2. Different intensity of the handphone (usage);<br />
3. Different ways that handphone can be used (uses)<br />
<br />
1. Example for different segment would be handphone for the senior citizens who require big wordings.<br />
<br />
2. Example for different intensity of usage would be for purpose of gaming where usage will be very demanding for power and capacity.<br />
<br />
3. Example for different uses would be biz use, social media, camera, music, movie and conversation.<br />
<br />
<b>Selling Hand Phone vs Estate Agency Practice</b><br />
<br />
So, in the common front of estate agency, most agents go for the seller in conventional selling, renting and leasing. This means estate agents concentrate on securing listing from owners. The main purpose is to be paid for the uses "To Let" and "For Sale". Full definition of "Estate Agency Practice" you can refer to MEAS 2014 Definition.<br />
<br />
From here, there spring out another three variables.<br />
<br />
1. Agents who tag with Developer (Owner) for intensity of "To Let" for shoplots and shopping malls.<br />
2. Agents who tag with Developer (Owner) for intensity of "For Sale" onto residential houses, strata livings - subsale and primary market.<br />
3. Agents who tag with BUYER (of LAND), and dig out the owners of land.<br />
<br />
NOBODY IS INTERESTED IN THE BUYERS!!! ONLY THOSE DEALING WITH LAND!!!<br />
<br />
Why?<br />
<br />
IT IS LIKE WHEN YOU ARE WHOLESALER OF HAND PHONE!<br />
<br />
When you are sourcing of which brand of hand phone to carry as a sole distributor, you look for the brand which buyers go for. You won't not want to represent a brand which nobody wants, right???<br />
<br />
Hence, you study why buyers want this brand of hand phone. Is it trendy? Or its battery lasts longer? Or it is thinner? Etc.<br />
<br />
Similarly, an agent of land would study the type of land the BUYER wants. In which case, is it a buyer or many buyers? Of course, many buyers! This means demand for the land is high, the price will be high too. As a result, the commission pay out will also be high.<br />
<br />
Now, what stands in between the Land Owner and the Land Buyer? The gap of knowledge between the land owner and the ready buyer is miles apart!!!<br />
<br />
Take for example, Land Owner who is a farmer, illiterate and never know of a land deal. The Land Buyer who is a shrewd businessman!<br />
<br />
Only when there is this GAP, that the role of Estate Agent comes in! (Don't get me wrong, An Agent should NOT conspire with the Land Buyer to cheat the Land Owner). When any element of fraud, undue influence, misrepresentation and coercion is found in a contract, the contract is voidable.<br />
<br />
Thus, to develop a position in the field, one must MASTER this knowledge of GAP! Target a segment of market where there is BIG GAP between Seller and Buyer. Try to bring this GAP closer and close the DEAL!<br />
<br />
The argument of closing the GAP is further discussed <a href="http://justletak.blogspot.com/2018/02/gap-barrier-or-opportunity.html" target="_blank">here</a>.<br />
<br />
Usually, a ready buyer is just about price. However, a ready buyer might not have the energy and precision of a foresight to see the GAP being near to close. The ART of closing this GAP is indeed a psychological one!<br />
<br />
The GAP can also manifest in the other two segments -<br />
<br />
For a developer who has many shop houses "To Let", the Tenants do not see the benefit of renting the Shops. There exist a BIG GAP!<br />
<br />
For a property owner who wants to sell his house, the Buyer do not see the benefit of buying that house. He might think that the house is too highly priced. This is also BIG GAP!<br />
<br />
As an estate agent, one MUST learn how to close that GAP! The ART to CLOSE the GAP is key to success in this game.<br />
<br />
YET, you don't want to use a method which everyone is using. That means you are no better than any others. You also won't want to always change your method, for you will one day run out of the idea. Hence, you need to work on a STRATEGY!!!<br />
<br />
So, when everyone is doing the same, what can you do different from others?<br />
<br />Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-19674062994668415962018-02-05T14:09:00.003+08:002018-07-06T15:27:31.770+08:002017 Part 2 Result!!!<div class="separator" style="clear: both; text-align: center;">
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<br />Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-6592057025864509672018-02-03T09:17:00.000+08:002018-07-06T15:28:09.645+08:00System and Control分蛋糕不如做蛋糕(佚名)摘录<br />
<br />
经济学家约翰•李斯特做过一个著名的实验:甲和乙各自被给予100元现金,甲拥有决定权,他可以把乙的钱全部拿走,如果甲愿意,他可以从自己的钱中分任何j数目给乙。那么,甲会无私地把自己的钱给乙吗?实验结果令人大跌眼镜,只有10%的局中人愿意给乙一些钱,超过60%的局中人从乙处拿钱,超过40%的人拿走了乙所有的钱。这项实验颠覆了人们對 “利他主义是人的本性“的认知。其实,在没有监督的情况下,人是倾向于给自己多分一些钱的。这一发现对现代管理制度的影响意义深远,纯粹依靠 “自律“是不可能管理好团队的,最终还是要靠制度和流程监督。<br />
<br />
在如何避免独吞、建立好制度方面,盗墓贼最有发言权。最早的盗墓贼都是两个人搭档,一个人在上面接宝,一个人在下面挖宝。上面的人一看抛上来的都是金银珠宝,禁不住诱惑,就会把绳子扔掉,拿了东西就跑,不管同伙死活。即使是亲兄弟也难以经受得住考验。后来,盗墓搭档就改为父子。儿子在上面拽绳子,父亲在下面挖宝,但是儿子也会有经不住考验的时候。最后,只好改为父亲在上面拽绳子,儿子在下面挖宝。正因为虎毒不食子,所以上下之间达到了制衡效果,再也没有出现过上面的人跑路的现象。<br />
<br />
好的制度把鬼变成人,不好的制度把人变成鬼。人都会有自私的一面,但是制度的力量可以避免这一现象的发生。<br />
<br />
历史经验告诉我们,完美的分配制度是不存在的,成天想着分蛋糕还不如一起把蛋糕做大。<br />
<br />
Verbatim from Tan Sri Dr Ting Chew-Peh's FB:<br />
<br />
https://m.facebook.com/story.php?story_fbid=10214893198820566&id=1145314801Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-19012322399918361192018-01-29T13:55:00.001+08:002018-01-29T13:57:14.621+08:00Moving from Blogger to WordPress!Dear all,<br />
<br />
Thank you for following me all this while!<br />
<br />
It has been half a year that my blog - my-realproperty1.blogspot.com can no longer allow increase in readership! On this issue, I consulted some IT people, and most of them suggested me to move over to own hosting.<br />
<br />
So, finally, I decided to host it myself. Paying for the domain and hosting server annual fees.<br />
<br />
Anyway, for scalability and future development to a Full E-Learning Support Portal, I need to step out and do it!<br />
<br />
Of all the troubles, the most teething issue is the links. This means when I move from Blogger to WordPress the links in my articles are still routing back to blogger sub-domain. Although I have done most of the customization, the links still cannot be changed.<br />
<br />
Therefore, I will manually make changes, and at the same time try to start making concise E-Book of my Blog. This will essentially take more than 6 months, if not longer. All that will depend on the result which is going to be announced soon.<br />
<br />
At this juncture, please try out my <a href="http://www.estateagentexam.com/" target="_blank">new website</a> which is incorporated with Member Restriction features. Those who are keen to pursue the examination can consider signing up for the Paid Membership.<br />
<br />
Thank you.<br />
<br />
Yours truly,<br />
<br />
Thomas Sim<br />
<br />Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-43413749252821642542018-01-19T09:52:00.000+08:002018-07-06T15:29:47.369+08:00Have you found your key?每个人都有自己的那把钥匙(刘同)<br />
(节录)<br />
有些人在世界上活得很辛苦,尤其是想靠才华养活自己的人。<br />
<br />
怕没有人喜欢自己,怕自己才华不够,怕坚持下去有没有未来也不确定,还总要看周围人的脸色行事。不喜欢夜场,却又不愿意放过认识人的机会。想得到别人的帮助,却分辨不出谁真正愿意帮助自己。看不到未来,也看不清自己。这样的人容易一直在黑暗里头破血流,最后心如死灰。<br />
<br />
假装成一个人,其实心里知道真实的自己是另一个人。<br />
<br />
每个人都有自己的一把钥匙,我们的使命就是不停地去寻找。当你找到自己的那把钥匙,很多事情的发展就顺理成章、势如破竹了。唱歌的就会有自己的样子和风格,写作的也会有自己的样子和风格。<br />
<br />
找钥匙是个很难的过程,需要耐心,需要时间,不能和别人比较,不能给自己压力。把双手双脚放在水里,一点一点摸索,直到靠记忆都能背出整片水域的地形。<br />
<br />
诚然,有些人一出生就自带钥匙,可绝大多数人的钥匙是需要靠自己寻找的。<br />
<br />
不要把时间花在“怕没有人喜欢自己”上,也不要把时间花在“怕自己没有才华”上;不要把时间花在“坚持下去有没有未来也不确定”上,也不要把时间花在“总要看周围人的脸色行事”上;不要把时间花在“不喜欢夜场,却又不愿意放过认识人的机会”上,也不要把时间花在“想得到别人的帮助,却分辨不出谁真正愿意帮助自己”上。<br />
<br />
不要急着去看未来,也不要急着想看清自己。安静下来找钥匙,找到属于自己的那把钥匙,一切就会顺利了。<br />
<br />
Verbatim from Tan Sri Dr Ting Chew-Peh's FB:<br />
<br />
https://m.facebook.com/story.php?story_fbid=10214753029356417&id=1145314801<br />
<br />Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-54108040755346826232018-01-18T08:38:00.000+08:002018-07-06T15:30:20.889+08:00Real academics is lonely学问贵孤往(范一直) <br />
<br />
第一流的工作,往往是一个人做出来的。<br />
<br />
陈省身晚年回南开大学定居,经常被邀参加学术活动。他说:“大家都鼓吹交流,讲科学需要合作,需要相互帮忙,这有一定道理,但不全对。真正好的工作,第一流的工作,是一个人做出来的。一个人的创见是自己努力和灵感的结晶,很少是一群人讨论的结果。” 钱穆曾说:“学问之事,贵能孤往。” 钱钟书也说过:“学问是荒江野老屋中,二三素心人商量培养之事,朝市之显学,必成俗学。” 一个是国际顶尖数学家,一个是“中国最后的国学大师”,一个是“学者中的学者”,他们做的工作都是“第一流”的。其“第一流”的业绩和“一个人” 的 “孤往”,大有关系存焉。<br />
<br />
如今人们重交际、讲公关,就是所谓的教授或学者,都喜欢往名人堆里扎,往热闹场合凑,以便混个脸熟。至于所做的“工作”是不是“第一流”的,则无心问之。办实业的,团队合作很重要;做学问的,相互交流也有必要,但别把交流搞成交际——毕竟做学问和办企业是两回事。学问贵孤往,至少我信。<br />
<br />
Verbatim from Tan Sri Dr Ting Chew-Peh's FB linked below:<br />
<br />
https://m.facebook.com/story.php?story_fbid=10214744785790333&id=1145314801<br />
<br />
<br />Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0tag:blogger.com,1999:blog-7622035499636353964.post-13372356422053048602017-11-29T09:13:00.001+08:002018-07-06T14:21:45.841+08:00Customer Relationship Management Q3Q. (Also posted in My-RealProperty1)<br />
<br />
a) Explain briefly the term "customer relationship management". (5 marks)<br />
<br />
b) Discuss the strategies for creating value for customers and capturing value from customers in return. (15 marks)<br />
<br />
(20 marks, 2012 Q3)<br />
<br />
A.<br />
<b>Customer relationship management</b> or <b>CRM</b> “is the process of managing detailed information about individual customers and carefully managing all customer ‘touch points’ to maximise customer loyalty”<br />
<div style="text-align: right;">
Kotler & Keller (2006) p 252.</div>
<br />
A customer touch point refers to an occasion when a customer interacts with the organisation, e.g., an inquiry, a sale, receiving a piece of mail.<br />
<br />
Other meaning of CRM can be:<br />
<br />
“CRM is a term for methodologies, technologies and e-commerce capabilities used by companies to manage customer relationships.<br />
<div style="text-align: right;">
Stone and Woodcock, 2001.</div>
<br />
The best and easiest to remember is this definition of Customer Relationship Management:<br />
<br />
"The overall process of building and maintaining profitable customer relationships by delivering superior customer value and satisfaction."<br />
<br />
Ref:<br />
All the above definitions of CRM were among many given in http://www.iuc-edu.eu/group/sem1_L2/2012%20MBR/9061%20Lecture%2013.pdf<br />
http://www1.uprh.edu/drgarced/merc3115/powerpoint14th/pom_14_inppt_cap01.pdf<br />
<br />
b) Strategies for creating value for customer and capturing value from them in return.<br />
<br />
Refer to<br />
<br />
"<a href="http://my-realproperty1.blogspot.com/2014/08/strategy-for-customer-satisfaction.html">strategy for customer satisfaction</a>"<br />
<br />
Ref:<br />
Earlier posts.Thomas Sim Yan Sunhttp://www.blogger.com/profile/12207452192647011959noreply@blogger.com0