David Robinson advertised his four-bedroom semi-detached house in Greenford, west London, in the Independent with an asking price of £116,000. He received a phone call from ATTA each time the ad appeared. ATTA told Mr Robinson that investors from the Far East were looking for properties like his. If he paid Atta £800 plus VAT up-front, that would cover the costs of marketing his home in Hong Kong. If the property sold it would charge a 2 per cent agency fee.
Mr Robinson was surprised to hear that his property was suitable for the Hong Kong market. Most estate agents dealing with Far Eastern investors find they are interested in central London only, where they can buy good quality new properties for renting out. Greenford is in suburban outer London and Mr Robinson's home was not new. But he was keen to sell his house, so he asked ATTA for more details.
He was sent a brochure explaining the background to the company. Mr Robinson offered to pay on a commission-only basis: 3 per cent of the purchase price if ATTA sold his house. This would have given the company more than the 2 per cent plus the £800 up-front fee it had asked for. "When it came to a commission-only deal they lost interest," he said. "I was being asked for nearly £1,000 with no guarantees. I received no satisfactory explanation of why it was necessary to pay so much in advance." Mr Robinson sold his house privately to the Church of England.
Elkan Allan had a similar experience. He was selling his four-bedroom house in Ipswich for £175,000 and was contacted by ATTA Associates. In his case the up-front fee was £1,200, to pay for the publication of a bilingual brochure, and there was also a 2 per cent commission fee. He was asked to provide extra details and pictures of his property so that its potential could be assessed by ATTA's marketing department.
Mark Peckham of ATTA Associates wrote to Mr Allan explaining that the firm was part of the ATTA group of companies based in Hong Kong. "The Chinese group is recognised as the leading international property investment and relocation consultants (sic) in the Far East," Mr Peckham wrote. "Hong Kong, as the gateway to mainland China, has always been a focus for corporations, investment syndicates and HNW (high net wealth) individuals who are especially keen to take advantage of the attractive rental income and huge capital growth potential currently being enjoyed by institutional investors in today's depressed Western markets."
Mr Allan was not willing to pay ATTA £1,200 up-front but, like Mr Robinson, he offered to increase its commission: to 2.75 per cent. He heard no more.
Mr Allan had received a glossy red brochure in English and Chinese plus a number of cuttings from British and Hong Kong newspapers, all of which described accurately the Far Eastern interest in the British property market. The brochure talks of the "ever-increasing demand for high-calibre residential and commercial investment opportunities". It emphasises that the UK market is believed to have bottomed out, that the rental market is buoyant and that investing in UK property is therefore a good business move.
All this applied more to new-build blocks in central London, than four- bedroom houses in Greenford or Ipswich. However, there is a market among Chinese buyers for such houses, as Joseph Chan of ATTA International in Hong Kong explained. Every UK town has a Chinese restaurant, whose owners or their relatives may be interested in buying a house nearby.
ATTA's London office is in Chinatown and employs Chinese staff. It is possible that Chinese people would prefer to go to ATTA rather than an English estate agent to buy property. ATTA International in Hong Kong deals with similar small-time clients. Big investors tend to use firms such as First Pacific Davies in Hong Kong, an associate of Savills.
First Pacific Davies said it would produce glossy brochures only for exceptional properties, as Savills and its counterparts do in the UK. Joseph Chan of ATTA said such a brochure was optional. "The up-front costs are not compulsory," he said. "They are just for people who want to sell their properties quickly and want to advertise."
When asked why ATTA had lost interest in customers who had refused to pay this money up-front, Mr Chan said I would have to ask the London office.
Mark Reynolds, ATTA's senior consultant in London, said it was the company's policy to ask for marketing expenses to be paid in advance to show the client was serious about selling. "If they are not willing to invest any money you have to question their sincerity," he said. "We don't make excuses for the fees that we charge."
He said it was a myth that Far Eastern investors were only interested in buying properties in central London: about 15 per cent of his business came from ex-pats. He could not say exactly how many properties ATTA had sold in the two years since they opened in London. "We get inquiries up and down the country," Mr Reynolds said. "We are selling properties all the time."
I spoke to other readers who had been contacted by ATTA. Aggie Mackenzie was rung when she advertised her three-bed terrace in Stoke Newington, north London, for £122,000."The man said he was representing companies which wanted to place employees in rented houses," she said. "They wanted to buy up places while the market was bad and sell them on when things improved." Ms Mackenzie was asked whether her area was good for public transport. She told them there was no tube line and one bus service. "I said it was not really the place to suit high-flying bankers," she said. "He asked me to send more details, but I didn't."
Ms Mackenzie's advertisement appeared in the Independent on Sunday on 19 March, when the paper carried advertisements for two houses in the Cotswolds. The owners were also contacted by ATTA. George Milnes was asked if he would sell his property and lease it back. "It was enticing," he said, "but I had a lot of queries about their fees which they didn't answer satisfactorily."
David Hillman was asked if he would go to London to meet a marketing executive from ATTA to agree a budget for the sale of his Cotswold property. "They wanted videos and floor plans, " said Mr Hillman, who is a solicitor experienced in the property business. Mr Hillman has since sold his property through the advert.
It is possible that any one of these buyers could have sold their home to Chinese investor.But it is a slim chance compared with the number of potential purchasers who buy through the normal estate agency or private sales channels. And those estate agents rarely ask for money up-front; if they do, it is normally a goodwill payment which is deducted from the final fee. With the current competition for business, that final fee will be a maximum 2 per cent.
For private advertisers the costs are minimal; £1,000 seems a lot to pay for that extra bit of market exposure.Reuse content