There are a number of reasons why Filipino real estate agents are so bad. First I should clarify that not all agents are in fact licensed agents. This is of course asserted as reason why you should use a 'licensed' agent.The reasons why agents, brokers, referrer are so bad can be traced back to the following:
1. Culture is a generalised set of values that define a nation's values. Of course it must be appreciated that 30% of Filipinos are close to the poverty line, so its fair to say that desperation is never far from most
Filipino minds, and the allure of material possessions and comforts. This country defines people as victims and perpetrators based on money, influence and education. Justice is given very little attention, though I understand the government is starting to clamp down on bad agents. It will take some time before a cynical Filipino people start reporting incidents of malpractice, so that is more reason for the government to be more vigilant. Are there any signs of that? No, corruption remains ever-present at the top.2. Lack of training: I know someone who has done the required or approved training to obtain a real estate license. The course is just 20 hours of seminar and of course the study to pass the exam. Just 58% of attendees pass the exam. In the course they claim that real estate is 90% law and 10% all else. Based on my assessment (right) law should only be about 32% of the course content, and I am allocating 40 hours to it, more than twice the amount required for the Filipino license. I am in fact suggesting that a half-decent course in real estate would need to be about 123 hours of course work (compared to 20 hours present). This of course no guarantee of service, but it would greatly lift the standards because I can assure you, it would discourage the plethora of 'weekend warriors' who are currently doing the course. They include retirees, socialites, Congressmen's silly daughters.
3. Lack of breadth: The biggest problem with agents is their lack of breadth. The above bar chart shows the lack of subject diversity in the course. These agents should be making this a profession. The problem is they are treating it like a sideline. This can only result in a deterioration in standards. As a foreigner I am constantly annoyed by people selling me property. I am of course the gold mine that is going to generate a signature which is going to buy them a car. They are hoping for a P1 million commission. The problem is - even the best of them don't know much about the market, they don't know how to analyse the market. Why? They know they only have to rot learn 20 hours of course material to get a licence. I dare say those that don't pass still practice the 'art', as no one expects a license to mean much anyway. Apparently the industry is calling for higher standards, but then there are politics there too, because their vested interest is increasing the market share of their members.
4. Ethics and ambition: The problem with the Philippines is that anyone good enough to be conceptual, has a running chance of scamming you. They see an opportunity to make money from a foreigner, or even expat Filipino. I just don't deal with them. They don't realise how they show their hand when they make such propositions. They neglect to see the conflict of interest, the deceit. They live in a subjective reality because there is an almost total absence of accountability. If you get caught there is a good chance you can pay your way out of trouble, particularly for the larger enterprises.
5. Lack of enforcement: The only way the industry can lift standards is by lifting the level of enforcement, and raise the standards for compliance.
You might think that I am against the idea of buying property in the Philippines because the agents are so poorly prepared for their job. But actually no. I am a great believer in managing risk rather than avoiding it. I also believe that you don't need a real estate agent in the Philippines. The best approach is to deal direct with buyers if you can. Avoid all agents wherever possible. I think you do need the assistance of a Filipino if you are not one, otherwise you will not be able to communicate in the local language, and that would help you a great deal. Its easy enough to find someone to help you. There are ample Filipinos out of work. Even a call centre agent gets just P1000/week net ($US22), so you shouldn't have much trouble finding someone willing to help since they are amongst the better paid. They might even take time off for you if you doubled that. Its better to have an older person with an education. You might just teach them something about real estate besides.
Andrew Sheldon www.sheldonthinks.com
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