Selling a property without CIREBA
My condo on Grand Cayman is listed with CIREBA. Can any CIREBA agent sell it or just the agent I listed it with? Can non-CIREBA real estate companies sell my property or am I now obligated to go through CIREBA? Can I sell it without using an agent and if so, how?
Auntie’s answer: I put your questions to local realtor Tony Catalanotto, who very patiently went through each one. First, as your property is listed with CIREBA that means that all member agents, since they subscribe to the MLS (Multiple Listing System), can access and sell it, even if the property wasn’t originally listed through them.
At the same time, once a property is listed through CIREBA, a non-member agent cannot sell it. However, if a non-CIREBA, registered real-estate company finds a buyer, they would be paid a referral fee if their offer results in a sale.
If you don’t want to use an agent, you are free to try to move the property but once it is listed through CIREBA, then all offers must go through a member until the terms and conditions of the listing agreement have expired. To sell it on your own, you would be responsible for advertising, marketing and showing the property yourself, as well as negotiating prices, which is probably why people use real-estate agents.
Mr Catalanotto also wanted to point out that CIREBA members get extensive training and have to sit an exam before being able to list or sell a property. “Much like any other professional, they are qualified experts in the field of real estate,” he said.
Category: Ask Auntie
In the USA it is highly illegal for brokers to collude together for a fixed commission, That is to say, one agreed between brokers or a brokers organization. It’s a violation of the Sherman Anti-Trust Act.
When taking my real estate brokers licensing in Florida this was drummed into every licensee. Likewise boycotting an agent who charged a lower commission.
Meanwhile it Cayman such “we all charge the same” commission rates are perfectly legal, so no competition on commissions.
Kayman realestate is a joke of an investment for 75% of all transactions
The other 25% are just lucky
I believe why CIREBA gets a bad name is because the majority of the agencies are now run by former expats who employ every Tom, Dick and Harry off the street and in particular other expats. I was in a restaurant on Seven Mile Beach the other day and the Bartender overheard me saying to my friend that I wanted to sell a property of mine. He jumped into the conversation and tried to get me to give it to him to sell it. I had never heard of this guy before and he tells me that he sells real estate for one of the top firms on the island on a part time basis when he isn’t working…Sure, just the guy I want to sell my property ..So he sells one property and makes as much as he would all year as a Bartender..and he is here on a work permit as a Bartender??? Really?
CIREBA is a brokers association. Cayman Islands Real Estate “Brokers” Association. The brokers get the lions share of the commission not the agents. I know I was an agent. Before you start they charge you $250 to take a test in order to work for them..You get a small percentage of the commission then they force you to sign a contract that says you are an independent agent. You have to pay for all your marketing and advertising even your own business cards, your own pension and health insurance and if they are a franchise you have to pay franchise and desk fees. So if you are going to beat up on anyone, beat up on the Brokers. They run a closed cartel and use the agents as their whores to get the bulk of all of the commissions.
Savills Cayman is an independent compnay non CIREBA.
It is also a global company with 700 offices worldwide to advertise your property for you and get the most exposure for you.
Are fees are below CIREBA.
Please contact Ann Baxter 640 6400 abaxter@savills.ky
compnay?? (company?)
Are fees?? (Our fees?)
Now I know at least ONE of the people responsible for the horrendous spelling and grammar in many real estate ads I’ve read recently! Professional (profeshunal?) Yep, saw that in a recent ad as well!
Things that make you say hmmmm…
CIREBA’s rates are too high, its that simple…everyone knows it…and having them fixed is tantamount to cartel (seems to be a word frequently used in this story thread)….more big brand realtors are now on Island that are not members…that’s going to continue…CIREBA should wake up, halve their commissions..there’s nothing objectionable to paying people to work, there’s everything objectionable in having to overpay for relatively little work and be stuck in a long term contract….there’s good and bad brokers everywhere…CIREBA doubles down on the bad by locking people in to overly lengthy commitments and also having high commissions in the first place which attracts the ‘professionals’ to CIREBA in the first place…property used to sell just fine before CIREBA, and it sells just fine independently of CIREBA….you can see a tide turning, i wonder if they see it soon enough…..the government should also step in and open up the Lands & Survey database to everyone, there is no reason that this is a private file of updated sales/leases/etc…it should be on the internet, open to anyone wanting to buy or rent or sell a property, residential or commercial….simple, and enabling everyone to set their values based on real, public information
why the diatribe ? If you don’t like them don’t use them ? Everyone has a choice
There is no choice because CIREBA has imposed greedy cartel profits on consumers.
No they don’t. That’s why anti-competitive behaviour like CIREBA’s is criminalised in almost every other country. It unfairly limits choice and competition, and when there is limited choice or competition the cartel owners can charge 5x what they would be able to charge anywhere else. Which is what they are doing.
I wrote on this topic in Viewpoint in January 2011. This is a shortened version:
When we left Cayman in 2010, I approached several real estate brokers. Every one of them quoted 7% as their commission. Not one of them would negotiate on this rate. “Will you sell it for 4%?” I asked them. They all said “No” to 6.5%. This is price fixing at its most blatant.
In 2013, when we moved house in the UK, the average rate being charged by estate agents at that time was 2.0%, but after shopping around, we found a reputable company who charged us 1.5%.
Cayman has a population of around 55,000. The town in the UK that I live in now has a population of 67,000. This town has 8 estate agents with just one office each. Cayman appears to have more than 40 realtors with around 90 offices.
After two months, as a result of the ad on CNS, we accepted an offer of $280,000.
If we had sold our Cayman condo for $280,000 through a realtor, that realtor would have got nearly $20,000 in commission and for doing what? Putting a couple of ads in the paper and making a few phone calls, that’s all. They told us that they do a lot more than that but none of them could ever tell me what, exactly. “It will go on our web site,” was the best they could come up with.
In the UK, such a ‘ring’ of realtors would be illegal. An island the size of Cayman can’t possibly support so many realtors. If there were fair competition, the only businesses to suffer would be the incompetent and the inefficient. The vendor would always benefit.
You didn’t say for how much your house was listed? The agent I used to sell mine was great and I had mine on ecay for months with nothing but tire kickers and low ball offers. As it turns out, I was pricing my property wrong and my real estate agent was able to get me more than I was asking. He marketed and promoted through various media at his own expense, did an open house and sold it within two weeks of me listing it and I got $15K more in my pocket. For me it was worth every dime and I would do it again. I don’t speak for all of them but I was quite happy with my experience and I know he worked hard and spent a lot of his own money to ensure I got the best deal for my home.
I bought it for $255,000 in 2006 and sold for $279,000 in 2010 and I was more than happy.
“Various media”? His website and the Compass but what else?
What money did he (or could he) have spent and of course any spent was his. He could hardly charge you a commission as well as advertising costs and how does a realtor ever possibly work hard?
I asked agents what they would be doing to sell my property and all I ever heard was that it would be on the website – nothing else. Things must have changed dramatically in 5 years.
I suspect that you are an agent or someone with close connections to an agent.
For the record, I am not an agent and my only experience was with this one but looks like you didn’t make much of a return on your investment. If you paid $255k plus 7.5% stamp duty. in total you would have paid $274,125 plus your legal fees. If you sold it 4 years later for $279K, it would seem like you just broke even..Glad you were happy breaking even but seems to me like you didn’t get as good a deal as you thought..
I didn’t buy the property to make money. It was not an investment. I bought it to have somewhere to live.
When I arrived on Cayman, I was paying £1600 a month in rent. As I “broke even” as you put it, I lived the equivalent of rent free and I SAVED (made) $96,000 over the 5 years.
Yes, I was happy.
Okay I see why then you didn’t need an agent as you were just try to recuperate what you had in it, so our scenarios were totally different. I was looking to maximise my investment and turn a profit..My agent showed me comparables and helped me stage my home properly for a sale and got my property on the MLS system.
Like you, I had a number fixed in my head that I wanted and he was able to convince me to go higher and I made a profit and he got his commission so everyone was happy. I’m sure not all situations would turn out like mine but I stand by his professionalism and knowledge and have nothing bad to say. Once he took over it was just smooth sailing and a great experience and I didn’t have to be hassled with unqualified people knocking on my door at all hours of the day wanting to see my house. In fact, he did all the showings which were not that many. once he listed it. In any case I have nothing bad to say about my realtor experience.
In the interests of comparing apples to apples, what was your property bought and sold for, and what year? What media was it publicised in?
Seems very strange to me that you had your housed so low that the realtor jacked up the price 15K PLUS 7% and it sold right away. Sounds hinky
I guarantee you it’s “hinky”. The 7% fixed fee is an outrageous rip-off and they know it which is why you see so much effort put into PR and spin about their “professionalism” and how they’ll get you more for your property etc. They’re sales people remember. I know for a fact that the CIREBA team keeps a close eye on articles like this one and inserts comments to get their 2 cents in. Don’t fall for it. Like Terry Wilton said all CIREBA does is put your house on the CIREBA website and in their database, and since everyone uses Ecay anyway there’s no value in it. I sold my condo recently for around CI$200k. CIREBA wanted CI$15,000 to do it! Instead we put it on ecay and I offered a friend (not an estate agent, just someone who seems to know everyone) 2% commission if she could show the house and find a buyer. CIREBA was all over her trying to get her to sign things and let their agents through, and actually trying to warn buyers off etc but they couldn’t hold back the tide and it sold within three weeks for more than I was expecting. I saved enough to cover the stamp duty on my new place.
CIREBA is an evil cartel.
Realtors earn their keep YOU cannot do it yourself and extract the most value out of your property.. THAT said The CIREBA members are running a con on the island They keep the listings in their own office, they do as they choose and don’t answer to anyone they suck big time totally unprofessional unethical and just plain wrong But that’s normal for KAYMAN
I KNOW I AM A REALTOR
Err newsflash……I have bought and sold all my properties myself and profited in all four sales, no realtor, no commissions, no problem.
You sound like a real professional..Can’t wait to throw all my business your way ..lol..
Good Lord man, you can’t even spell Cayman right!
No wonder you remain anonymous!
In the USA is it CRIMINAL for realtors to set fixed fees among themselves. It’s a violation of the Sherman Act.
Fees are by law freely negotiable.
In Cayman they are fixed by agreement and no once can charge less and remain a member of CIREBA.
bottom line…..realtors are just parasites living of peoples need for property ownership…..
they will sell anything as long as there is commission in it for them…….
don’t get me started on the nonsense ‘market updates’ published in local publications….
how come with ‘market updates’…its always a good time to buy??????
what have the realtors got to say to around 75% of homeowners who have are now in negative equity…..
For other than really low-ticket properties, I will suggest that you find a seasoned agent working for a broker with a good tradk record for the type and pice-point of your property.
Let’s balance some of the CIREBA-bashing and agent hating here with some reality:
Commission rates: As some have pointed out, the commission rates are higher here than in the US. Why single out CIREBA commission rates in comparison to fees charged in the US or UK? We typically pay about twice US prices (or more) for just about everything here. The steep cost of living and the high cost of operating a business here is a significant reason that broker commissions are higher here than in the US. Add to that economies of scale and the picture becomes clearer. A large broker in the US may have many hundreds of listings as compared to maybe dozens here. In addition, if you look at the stats regarding time-on-market, you will see that the Cayman broker has to keep a property in inventory significantly longer, entailing more time devoted to showings, greater advertising costs and generally much greater overall marketing costs than his US counterpart.
Negotiating the sale: The experience of the agent and track record of the broker are key. But it is the agent who needs to come through for you in the clinch. It is during the showing and negotiating the offer that a seasoned agent can shine and make you money. Almost all owners make blunders during the showing, some serious, shooting themselves in the foot along the way and costing themselves $$$ in the end. A seasoned agent knows how to ethically portray your property to a buyer in the best light possible. Moreover, most owners usually have no idea how to negotiate with a buyer come time to parry over the offer. Most inexperienced sellers fold under the pressure of the offer process and do not perform as well as a seasoned negotiator. that = money lost. Additionally, CIREBA agents are familiar with the basics of real estate contracts and real estate law. They can be you first line of defence against committing a blunder involving the offer and contract for sale that could see you ending up in court or being defrauded.
Who do ya trust? For the buyer, the peace of mind that comes from knowing their money is being handled by the broker as trust money in what amounts to an “escrow” account makes them more apt to be in a position of ease, which can amount to a better offer. Many owners commingle deposit money in their personal account. That can be a big mistake.
The value of having an agent on your side is revealed that over 80% of US buyers purchased their home through a real estate agent or broker—a share that has steadily increased from 69 percent in 2001.
How much?…The first thing a seller must do to is set the asking price. But how? CIREBA agents have access to the LIS CaymanLandInfo database and research the sales history of comparable properties to determine selling prices and market trends; moreover, a seasoned agent will have experience analysing the properties on-market to see how current listing prices relate to your property. Ok, I am going to give away a secret here, just to illustrate that there are tricks in the trade that a novice might not know: Set the asking price too high and you may actually be setting yourself up for getting less money in the long run. (Set your price too low and you will certainly be losing–but you already know that.) I could go on, but I think smart people get the picture: a good agent working for a reputable broker will add value to the sale of their property.
Firstly your argument about prices in Cayman being high justifying higher commission is clearly wrong. The price of the property reflects the underlying economy (including relative prices etc). You take a higher percentage which means you are taking relatively more of the economics of the transaction.
Next the lack of properties on an agents books is only so becaue there are so many agents (because they can make so much money from a single sale).
Next we know that the ‘time on market’ stats for Cayman are wildly distorted because of the high number of properties that are ‘on the market’ only if the price is right (ie stupid!).
To be clear some of the brokers on Island are terrific and I feel they earn their commission (much as it hurts to part with a hefty chunk of sales price).Others are totally useless and ti is a matter of human nature that a body will be judged by its weakest 5- 10% – just as we have some excellent police officers on island the force gets a universal bad name because the bottom 5% are a disgrace.
Unfortunately with MLS you can’t avoid being on the end of dealing with one of the useless agents. Having a good agent as your selling agent can cushion that but it can’t remove it – the negotiation with the end buyer is by the other agent for example and they have no relationship whatsoever with the seller. They know that if they don’t get their buyer’s offer accepted another agent will probably get the sale so they will not push for a higher price.
Similarly I personally recall selling a property with the ‘2nd’ agent misrepresenting to the buyer what was included (we had drawn up a chattel list and they ignored it). It caused no end of issues and grief.
The smartest thing I ever saw was someone who had decided to sell up sitting the CIREBA exam first (she found it very easy) and then putting her property on the market with her as listing agent. Halved the effective commission!!!!!
cayman realtor commisions…..never has so much been paid for so little in return
cireba deserves all the criticism it gets….but in some ways you are correct…we live in a free world where no-one is forcing anybody to use cireba…..but yet they exist and thrive….
I’m guessing this is a ‘seasoned’ broker..
I don’t trust anyone who is so insecure they have to paste pictures of themselves on ‘For Sale’ signs. I mean really what is that about?
CIREBA are an old boys, self governing cartel who’s sole purpose is to protect their own interests, not those of the consumer. Simple as. There are definitely some good realtors on this island who are professional and provide considered advice but there are a lot of absolute shockers, some of whom work for the biggest firms. These guys have very questionable morals / ethics and are quite content to lie in order to achieve a fee. Some of them also tend to have an inflated opinion of their own self-importance but I attribute that to realtors being held in unusually high regard here and given plenty of opportunities to discuss the market, whether it be in the business section of a newspaper or on the radio. This cannot be considered impartial advice as they stand to make money off the back of telling you to ‘buy or sell now because the market is hot.’ Yes – maybe in some areas but definitely not in others. I won’t even begin to go into realtors buying and flipping foreclosed properties. As for qualifications – behave! Some of them were diving instructors or pulling pints up until a few years ago. Sadly, if you want your property to get the greatest exposure, you don’t really have a choice but I just hope you have one of the good, realistic agents.
awesome!…you sound like a qualified independent property professional. thank you for your comments.
Not very complimentary to dive instructors or bar tenders ..let me guess you work in the financial service industry ?
CIREBA is a cartel in all but name. Amazing how they get away with it…more fool everyone else for listing with them and accepting their charges….that market is ripe for a total revamp as to how real estate is sold on these islands….MLS? that was necessary about 15 years ago….now you just google it
List with an agent who is not in CIREBA. There are several. You can negotiate the commission. If they have a decent website and reputation, the buyers will find them.
realtors are nothing more than used car sales people blinding by their own greed for sales and commision…..
Call me Brian Bodden 916-5453 a Caymanian Realtor with over 30 years selling > NON CIREBA.
“extensive training” “much like any other professional, they are qualified experts in the field of real estate”…come on Tony, you must be having a laugh! Please enlighten us as to what this extensive training is and what professional qualifications the CIREBA realtors actually have?
Professional what a laugh!!!!!ask them questions that more than half of them can answer!!!!
When was this built? they will give you the wrong date guaranteed why because they don’t care and don’t research the history of the listing. Some CIREBA agents are rude, And before I forget total lack of knowledge of the three Cayman Islands.
And yes they need to stop giving permits out, they all work on commission but the
work permit forms are filled out as if they get a salary!!!!
Getting ‘extensive’ training and sitting an exam doesn’t make you an ideal real estate agent. I’ve been jerked around by 3 separate agents. Tread carefully. Being the most well known or well advertised doesn’t make you the most reputable
Condolences. You are now firmly in the clutches of a large cartel, from which there is no escape.
Cancel the listing in a letter.
Best you sell it yourself…. Or i can sell it for you ? and only take 2% of the profits compared to what the agent will demand 7- 10%
I am sure you will make an excellent agent! Nobody knows who you are or how to contact you! That is bound to get loads of people looking !!!
CIREBA is just another monopoly, you are better off selling it yourself. I have never used a realtor to buy or sell a property. Realtors are just vultures making a lot of money for doing very little. I had to laugh at the ‘have to sit an exam’ remark. As if that makes them better. Stay away from exclusive agreements, that is just so they can lock you in and do even less.
If a non-CIREBA agent finds a buyer CIREBA still keeps most of the sale commission even though the industry standard is to share it equally. They do this to ensure that most agents will join CIREBA. And guess what one of the most important terms of joining is? Not to compete on commission with other CIREBA agents. They all have to charge the same. Which is why you will pay your Cayman estate agent double or triple what you’d pay them in the US or U.K. It is an anti-competitive monopoly that has been ripping Cayman people off for decades. If they tried it in the real world they would be called criminals. If you have any sense you’d list your house privately on Ecay before you sign anything with a CIREBA agent.
Like all commission driven “professionals”, what Due Diligence/KYC do Real Estate agents conduct on potential purchasers to ensure that there is no possibility that the transaction represents the laundering of the proceeds of Criminal Conduct. The promise of a fat commission, especially in a lean period, can be a great incentive to turn a blind eye to proper procedures.
The Due Diligence required of a real estate agent is very similar to that of any of the financial industries in Cayman. Plus each agent is required to go thru training at least every two years. Each company is required to have a trained compliance officer and each year a spot check is done of each agency to assure that they are meeting all required compliance as required by law.
Tell that to Remax ……and the debunked East End Hotel Condo Refunds.
And they also take a huge chink of commissions