General Meeting

04 April 2006

MINUTES

 

Chair:              Connie Larson

Steering Group: Peter Davis, June Hall, David  James, Pat James, Diane Peek

           Marian Stokes, Nigel Watson

Minutes            Sheila Vango

Guest Speaker:  Shaun Watson, ex-Estate Agent

 

The meeting was opened at 7.30 pm by Connie Larson, who welcomed all members and guests in attendance.  He started by saying that events had moved along nicely in his absence (two months) with some movement in Permissions To Buy being granted, deeds issued and monies returned to some members. On the legal front the HBPG are confident of some news surrounding the lodgement of all deeds with the Land Registry Office to be announced by the government shortly, thereby securing land and property purchase for all foreign buyers. The HBPG are also confident of some news regarding the Aga project to be publicised shortly – sadly neither of these events could be expanded upon at tonight’s meeting as until they are published it would be wrong to raise hopes and expectations, but that the main aims of the group were being met by continued pressure and the highlighting of where the system let foreign investors down. He then passed to June Hall.

 

June explained to the meeting that our guest speaker, Kate Smith from Iain Smiths Estate Agency, had spent a lot of time in discussion with herself and Diane to ascertain what sort of information would be of help to our members and was looking forward to sharing that with us.  Earlier this week Kate received an anonymous phone call telling her not to attend, adding that she should think of her family (she has a young daughter). She discussed this turn of events with her family and after much heart searching, she sadly decided that she could not go ahead. The committee are in full support of her decision and thank her for being honest with us. She has no idea from what quarter the threat comes – a lawyer, a builder, another estate agent or if the source was from the North or South of the island. June pointed out that this is not the first time that those involved with the HBPG and their members have been threatened and it is sad to think that those seeking a new life in this ‘Corner of Heaven’ keep such items as baseball bats, pepper spray and people alarms in their homes. Are people in the TRNC so afraid of the HBPG and what do the ordinary people of the TRNC think of this sort of behaviour? She concluded that they would be as disgusted as we all are.

 

Fortunately, we found another speaker and she would like to introduce and thank Shaun Watson for stepping in to fill the breach. Shaun has worked as an estate agent and is currently working for a local developer since moving here 3 years ago.

 

Shaun Watson ex Estate Agent

Shaun started by saying he was sorry Kate was unable to be with us tonight as she was very professional and knowledgeable about the Estate Agency business within the TRNC, but that he would do his best to fill her shoes.

 

He quickly outlined his own history, he moved here three years ago with his wife and daughter after spending 25 years in the police force, with time spent in the army prior to that. He, like many of us, had visited North Cyprus before deciding on coming to live here. He had also spent time here in 1974, following the separation of the island and fell in love with it then.

 

He therefore knew nothing about the Estate Agency business, but took a position with a local Estate Agency back in 2003 as the boom started. He now knows lots and would speak to us tonight about what clients should be asking and what they can do to minimise any future problems.

 

He firmly believes that the problems start at government level as events have overtaken the practices that were adequate 3-4 years ago. (a view shared by Talat Kürşat at last months meeting) and nothing has been done to redress the problems quickly enough. Pressure has to be brought to bear to change these practices and he was glad to report that many procedures are in the process of being overhauled, but progress is slow.

 

For instance, anyone can open up an Estate Agency – all they need is an office and some houses to sell – they do not require a licence to operate. Some of the Estate Agents on the island are very good, some are not so good. There are approximately 400 Estate Agents offices on the island at the present time compared to a handful 3 years ago. In the past most of the Estate Agents dealt with the same 90% of the properties offered for sale and therefore they competed with each other for a sale. As the building boom took hold, some Estate Agents marketed their own projects and they were joined by builders who set up their own Estate Agents offices to promote their own builds. Now you can look in many Estate Agents windows and see different properties in each – so you must shop wisely as the choice is seemingly endless –as are prices and quality. Most Estate Agents are not chains and as a newcomer looking to buy, you have no knowledge of who has been in business for a long time and has a proven record or who opened last week. Therefore he would give us some guidelines of what to look for and questions to ask as well as giving some background information applicable to Estate Agents practices.

 

What does an Estate Agent in the TRNC do?

Just like in the UK they sell houses, but often end up supplying much more. For example, in the UK they mainly put buyers in touch with sellers, they are rarely asked to provide local knowledge. Here they tend to be the font of all sorts of miscellaneous information, such as where can I bank, how do I get my stage payments here, where do I buy my furniture, what goods can I import, how do I import my goods, etc etc – the list is endless. Many help with accommodation, pick you up from the airport, send you progress reports and pictures of your build, arrange your car hire and help out if you fall ill here. Many of the relationships last months from pre-build to completion which may be a year or so ahead. Those are the good ones – the bad ones get paid from your deposit and shrug off their clients. 

 

So who are the good ones – ah the million dollar question…you must do your research and make your own mind up! Visit as many as you can – ask the questions (to follow) and if you don’t get the right answers – move on – there are plenty to choose from.

 

Do Estate Agents vet builders?

To a degree yes – again that is easier with an established builder who has been operating on the island for some time as you can see the quality of his work and how he keeps to project timescales and treats his customers, but again the boom has changed that scenario. Anybody here can ‘become’ a builder, again the building industry is not completely regulated, anyone with a plot of land and some money can set themselves up as a builder and employ contractors to fulfil the build - some are good and take pride in their projects, others not so good and Estate Agents have had there fingers burnt as well as the public. A bad builder who reneges on his promises causes more work for the Estate Agents in the long run and damages his reputation as well. On the other hand some builders, who may have had a successful businesses for many years can over extend themselves and run into financial trouble and the Estate Agents has to meet the needs of all involved and find a solution – maybe by juggling stage payments.

 

What steps should future buyers follow when selecting an Estate Agent?

1.      Look at lots of Estate Agents, listen to what they tell you about the process of buying in North Cyprus and take notes. Move to the next Estate Agents and ask the same questions; listen and learn – the more you learn the more questions you will think to ask. Sadly, you may get several answers to the same question, but eventually you will ascertain which answer is correct as you question the answers you are given. Do not be afraid to tell an Estate Agent you are speaking with several agencies!

 

2.      Ask people you meet in bars and restaurants about some of the Estate Agents you have visited, listen to what they have to say BUT make your own mind up.

 

3.      Don’t go and look at property with the bloke from the bar, restaurant or hotel – he may be genuine – but do you want to take the risk. Introductory fees are common place here and that will be his overriding motive.

 

4.      Keep your ears open when you are socialising, if it sounds as if folk live here, ask them for their experiences – good and bad – do they know a good builder, lawyer, if they were to do it again what would they do different?

 

5.      Ask hard questions – when you find a property you like – ask how long the builder has been in business, have they dealt with him before, has he applied for and received all the permissions he needs before starting the project, has he satisfied clients you can meet, where are his completed builds (then go there and speak to anyone you can find who is living there – and ask them). You should not be embarrassed to ask the Estate Agent anything that you feel is relevant.

 

6.      Ask what the best deal is on a particular build, what extras are included in the price, is the price negotiable? Remember many builders put their properties with more than one agent – so ask all the Estate Agents dealing with that build the same question!

 

7.      Ask what the extras are and their likely cost, but bear in mind that many extras – such as marble – comes in many qualities and therefore the price differs, do not assume that because one Estate Agent states marble costs £XX a metre and another that it costs £XY a metre that the first guy is ripping you off – check the quality first. A classics example is pools – the same size pool may vary by as much as £6000, but some pools leak and others don’t.

 

8.      Find the payment schedule that works for you and the builder. Builds are financed almost 100% by your stage payments. It is unreasonable to expect to pay the bulk of the purchase price at the end of the build, likewise why should you pay the bulk up front. The usual deposit is between 10-20% of build price, with equal payments after that. Usually there are five payment stages – deposit, foundations, roof, doors and windows in, completion. Find the payment schedule that suits your pocket and timescale. Ask what happens if you do not have the money for one of the stages, ask how you will know when each stage is complete.

 

9.      Because Estate Agents get their fee from your first payment, instead of throughout the build, you may find that communication regarding progress slow. See if you can find someone living here who would be happy to take some photos – once a month – or at your request when money is asked for so that you have independent verification of progress. It has not been unknown for people to be sent progress shots of the wrong property. Most people living here are retired and would not mind helping you out, you can always return the favour by bringing in goodies from the UK when you visit, or treating them to a meal out.

 

10.  When the time comes that you go with the builder or the Estate Agent to select furnishings – tiles, shower units, kitchen units, window and doors etc – ask the manufacturer for a copy of the materials you selected – keep this handy to remind the Estate Agent that what you agreed would be installed in the next stage of the build – so much easier than coming here and finding your kitchen tiles in the bathroom!

 

11.  Get yourself an independent solicitor. You must remember that it is not against the law here for one solicitor to represent both parties – but it is not a wise position to put yourself in! Ask the Estate Agent which solicitor the builder will use and then select another one. Again pump all these ex-pats that you are now talking to, for their opinions.

 

12.  Ask about the local building projects in your area – it is common to find you are one of six and have wonderful views to come back to find phase 2 of 12 houses has commenced. You cannot stop progress, but can ascertain your current position. Look at the for sale boards surrounding your chosen plot and then go ask those agents what they are building!

 

13.  Ask about the location of military installations in your chosen area – the army can prevent you from ever getting the deeds to your property as they will not allow foreigners to purchase with set distances of their establishments.

 

14.  Ask about the provision of tarmac access roads, telephone connection, electricity and water – mains and well supplies. Look at where you hope to live – will there be access for rubbish trucks, water tankers or gas tankers – your furniture deliveries?

 

15.  Last, but not least – get the answers to all these questions in writing, if they will not commit to paper what they assure you about verbally – walk away. It is up to them to earn your trust – not for you to give it!

 

What does the future hold for EA in the TRNC?

Shaun did not think that we have seen the property boom here yet – first half of 2004 was a mini boom. Due to groups like the HBPG and a number of foreigners’ getting involved in the Estate Agents side of things, some building, some developing and others investing - a lot of the loopholes have come to the fore. Discussions have been taking place, not only about the need to regulate the whole industry, but what level of service should be adhered to gain a licence to sell, build or develop in the TRNC. This may not help those of us in the room who are already caught in many of these traps – but would assist those coming behind us to make informed decisions and to be able to rely on the groups they are dealing with – with a recourse to a official regulating body if things do go wrong.

 

Shaun did comment however, that the group needs to grow larger and that it would be strength of numbers that eventually bring about these changes. Everyone who has bought, or is buying should join to even if they never attend a meeting or report a problem.

 

Estate Agents would have lots more information about builders if they were regulated also. At present there is a grading system, but he estimates that only about 40% of the builders here are registered with and regulated by the Construction Association. There are a handful of builders in the top level, which are basically the self sufficient ones who are eligible to apply for government contracts. (hospitals, the airport project, schools etc).  By self sufficient he means they have their own plant, access to building materials, employ regular teams of skilled workers and have financial back up – these are Korman Construction, Emek, Sercem. At the unrated end – there may be good builders, but many of them import cheap labour from Turkey who do not necessarily have the skills required to produce high quality work.

 

Open Questions

 Q.    Are any of the Estate Agents here affiliated to a recognised professional body?

A.      No not that I know of, except maybe Hillcrest.

 

Q.    Are there any government provisions for fining the rogue Estate Agents, builders or solicitors?

A.     …..No not to my knowledge

 

At this point Shaun closed his presentation and the meeting recessed.

 

Official Meetings

Marian has been away for much of March, so is only just getting back into the round of trying to get answers to our collective problems. Marian and Nigel are attending a meeting with the President of the Construction Association this week. At this moment in time there is nothing in her diary with the government working party which was first promised some 4 months ago.

 

 

Administration

See piece on Choosing an Estate Agent above.

 

Request for Case Studies for the website.

In light of the threat to Kate Smith and the reaction of the law society earlier this year whilst the group was ‘naming and shaming’ it has been mooted that many of these case studies could be published using A Purchaser, A Builder, A Estate Agent and A Solicitor – after all if one of these people recognise themselves form your ‘story’ they are hardly going to shout about it!  It is sad that the public cannot know the names of those involved, but we can assure the public that these experiences are no less true and it is up to new buyers to be vigilant and be aware of what may happen. If anyone is happy to have their experience published under this complete anonymity, please let the Marian or Sheila know.

 

Other business

The new website can be found at www.homebuyerspressuregroup.net  Please have a look and tell us what you think. In the past month the site had 1800 hits from 22 different countries around the world. Membership is slowly increasing, but more are needed to make an impact, it was reiterated that your information is treated as Strictly Confidential, so please do not be afraid of being perceived as a trouble maker or that you may come from under threat from those you are complaining about. It is easy to intimidate a handful – not so easy with a few thousand.

 

The meeting drew to an end at 9pm after the public forum.

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