President of the Association of Real Estate Agents (AREA), Mark Edghill, is signalling that commissions on property transactions may be heading higher.
Speaking at AREA’s annual public seminar last Wednesday titled Towards a Brighter Future, Edghill said the viability of many real estate agencies had been sorely tested over the past three years, especially with the COVID-19 restrictions.
He said the board of AREA believes that now is the time to bring relief to this situation and its members “by recommending the adjustment and increase of the levels of commission charged in every transaction.”
“This increase will work towards a brighter future for the industry as a whole, by actually restoring commission rates to the levels set by AREA in the 1980s and which are presently seen across the region and in most international markets.
“It is our position that there is no justification for real estate professionals in Trinidad and Tobago to be working at a 50 per cent disadvantage compared to regional and international rates.”
Providing clarity to the AREA president’s comments, a member of the association told Sunday Business that real estate commissions throughout the region and in North America are in the six per cent range, while commissions locally are about three per cent.
“We will be launching a sensitisation campaign in June to promote the new commission structures and we would need the support of all real estate professionals nationwide to support this initiative to restore the fair market income for our agents,” Edghill told the annual seminar, which was virtual this year.
The AREA president also addressed the issue of the legislation governing the sector.
He said after decades of work, AREA at last succeeded in 2017 to forge a partnership with the Ministry of Legal Affairs to draft a bill that passed through Parliament on June 1, 2020.
Describing the bill as half a step forward, Edghill said since the legislation now awaits proclamation by the President, AREA has been afforded the time to do some serious work on its shortcomings.
He said an analysis and compilation of some 90 board-recommended amendments were submitted to the office of the Attorney General earlier this year.
“Our intention is to lobby for these amendments to be incorporated into the act prior to the proclamation. They are amendments we lobbied hard for in 2020, as well as new operational issues and structural disconnects created by the act that without question need to be resolved,” said the AREA president.
He said the association has a second chance now to persuade the AG of the importance of these changes to the entire operation of the real estate sector and its individual practitioners.
Addressing the local real estate market, Edghill said that over the past year, there has been an increase in the market activity in residential sales mostly below $2.5 million and rentals below $9,000.
“We continue to see the supply of middle-income housing developments to satisfy this demand with several projects underway and nearing completion,” said Edghill.