Moraira Traveling south from Javea will take you to Moraira, a picturesque town, popular with tourists and which has a small community of expatriate foreigners. Moraira was, for a long...
Dawn at Malaga airport and the first bleary-eyed passengers struggle off the early charter flights from Britain. Some are holidaymakers heading for the beaches, golf courses and Robin Hood pubs of Spain’s Costa del Sol. But at this hour, most are homebuyers. Clutching brochures with jaunty “Live the dream!” slogans, they want to make the most of their weekend search for a place in the sun.
Waiting for them outside the terminal building are fleets of cars — blue minibuses for ordinary buyers and silver BMWs for well-heeled private investors. Grey-suited girls, sweating in the heat, smile and wave: “This way for Ocean Estates!” With cash in their back pockets and hope in their hearts, dozens of prospective buyers climb into the air-conditioned cars and head off into a brighter future.
One woman, however, is not smiling. Wearing jeans, sandals and a pink T-shirt, Haley Neaves watches the scene with a mixture of pity, contempt and shame. “They are lambs to the slaughter,” she says as the BMWs and minibuses head for the autopista to Marbella and beyond. “They think their lives are about to get a whole lot better. But the chances are they’ll end up worse off.”
Neaves should know. For two years, the 23-year-old from Hampshire lured planeloads of property investors out to southern Spain and helped sell them hundreds of holiday homes.
She worked for one of the biggest estate agents in the area, Ocean Estates, but quit this summer because she felt that her firm — like others in southern Spain, she says — was ripping off unsuspecting investors.
Neaves’s story should be read by anybody considering buying property on the Haley Neaves, from Hampshire, worked for Ocean for two years in the Costa del Sol or the Costa Blanca. She exposes the ruthless tactics that some of the biggest overseas property firms use to tempt British buyers into parting with hundreds of thousands of pounds. In an interview with
The Sunday Times, she reveals how estate agents lure purchasers by promising that investments are “risk-free”.
Neaves joined Ocean Estates after moving to Spain two years ago. The firm is run by Alasdair and Alice Macdonald, a British husband-and-wife team, and is based in Puerto Banus on the Costa del Sol but also operates in South Africa and Asia. Its slogan is: “Your investment is secured, your dream awaits.”
Neaves worked in the company’s Costa Blanca office in Alicante, starting as a receptionist before being promoted to join the sales team. Her job was to tempt potential British buyers to sign up over the phone for “inspection weekends”: three-day property viewing trips to the Costa del Sol and the Costa Blanca. Once they arrived, she had to persuade them to buy.
“It was ‘sell, sell, sell’ all the time,” she recalls. “The managers would tell us: ‘Don’t think of the punters as people. They are just money’. The whole atmosphere was intimidating. Managers screamed at us the whole time to work harder. It was ‘sell or get sacked’. I’m ashamed to say I decided to sell.”
Neaves used every trick in the book to identify potential buyers, to persuade them to come to view properties and to make them put down deposits on new homes, ringing potential clients relentlessly, at 8 o’clock on Sunday morning or even when they had asked her not to keep calling. “I was sneaky and underhand. I lied and scammed every time a buyer phoned up or signed up at one of our UK property exhibitions.”
She followed a set sales technique. Neaves started by weeding out buyers too poor to bother with. “When I started chatting on the phone to a buyer, I innocently took their postcode. While they were on the line I went to the internet site upmystreet.co.uk to check the average property band in their area. If the average house was worth less than £80,000, I hung up.”
Once she had identified potential buyers with money, Neaves targeted their children. “If I knew someone was wealthy and might want to invest, I telephoned them after school hours. If a child answered the phone, I asked whether they were happy at school in England and had lots of friends or whether they would rather go to school in Spain where it was ‘nice and sunny’. When their parents came on the line I would say something like ‘even your daughter wants to come over here’.”
One common sales technique was known as “hands-free”. If Neaves was struggling to persuade a buyer to come to Spain to view properties, she put the caller on hold. “While the buyer was waiting, I would go into the boardroom, pick up the call again and put it on speakerphone, so my manager could sit in with me and listen. Each time the buyer raised a problem, the manager would hold up a card with the answer I should give.
“If a woman said her husband had just died he would hold up a sign saying: ‘Chance for a fresh start!’. If someone said they were getting divorced, a sign would say: ‘Lots of attractive, outgoing single people here!’. At the end of every call a sign appeared saying: ‘Come and live your dream!’ It was cynical and manipulative but most of the time it worked, and people agreed to come out on viewing weekends.”
Inspection weekends take place every weekend throughout the year. They are the main tool overseas property firms use to sell new homes. Buyers pay about £200 a head to come on a subsidised three-day property viewing trip. Neaves describes the Ocean Estates viewing weekends she organised as “controlled, concentrated, hard sell”. She never told buyers where they would be staying until they arrived because she did not want them making arrangements to meet other agents. To be doubly safe, she always chose a hotel “in the middle of nowhere, so that they could not walk anywhere on their own and see other agents”.
Few of those who went on inspection tours had viewed property in Spain before and Neaves exploited their ignorance. “I bombarded them with positive propaganda all day every day. I told them I had ‘cherry-picked’ the best new developments where they could buy off-plan and ‘get in early’ before prices started rising. In fact, I just chose to show them the new developments ecause they are easiest to sell and because I made a tidy commission.”
Neaves assured buyers that any money they invested would be risk-free. They could expect capital growth of 25%-40% a year, she had a 95% success rate at selling on homes before completion, and rental values would cover any mortgage. These figures are widely repeated by Ocean staff, and the capital growth claim is printed on company literature. In fact, Neaves’s experience was that the financial predictions were vastly overoptimistic. She says the real rate of return was about 10% per annum, the correct resale rate was a meagre 20% because there was an oversupply of new property with huge new developments coming on the market each year, and the rental market was so weak buyers would be lucky to get tenants at all, let alone cover their mortgage repayments. However, with no way of independently checking the facts and figures, many buyers put down £2,000-£4,000 deposits during inspection weekends.
Unknowingly, Ocean’s customers were also paying Neaves a hefty commission. Unlike in Britain, where the vendor typically pays the estate agent 1%-2% of the sales price after completion, Ocean Estates sales people, like many other agents in Spain, earn between 8%-12% commission on an off-plan property sale — hidden in the sales price.
If buyers asked tricky financial questions, in particular about capital-gains tax — a hefty 35% in Spain — Neaves tried to change the subject. If she couldn’t distract the buyer, she assured them that they could register the sale at a lower price than they had agreed and accept the balance from the buyer in cash, thereby minimising capital-gains tax. The practice is illegal — but commonplace — in Spain.
Once a buyer had reserved or bought a property, Neaves admits her breezy, helpful attitude was replaced by a “do next-to-nothing” approach. Despite assuring buyers that she and Ocean Estates’ “dedicated after-sales team” would take care of all their needs, including marketing properties for sale, she reneged on her commitments because she was too busy selling fresh off-plan developments to new buyers.
“Once punters had bought, they were on their own as far as we were concerned,” she says. “It was always easier to sell new property off-plan to new buyers than flog existing stock.”
Neaves insists all Ocean Estates sales executives used the same sales techniques as her and that such methods were sanctioned and enforced by company bosses. “I know that I sound like a real sod. I was. But the truth is that was what the company wanted me and all their staff to be. They trained us to act like that.”
To most observers, Neaves’s story sounds implausible. Surely buyers would not fall for sales patter that promised staggering capital growth of up to 40%? She says it worked because “I was trained to be good at misleading people — but also when people come out here to buy, they tend to leave their brains behind. They really want to believe in something that is too good to be true”.
But if she was so disgusted by what she was doing, why did she work for them for two years before quitting? “Ocean are very good at keeping staff hooked in by paying commission three to six months after a sale. I was always owed lots of money, so I carried on until I couldn’t take it any more.”
The last straw was when she was told “to do a hands-free” on an 80-year-old woman who couldn’t afford to invest and had asked her not to call her again. “My manager simply said: ‘Put her on hands-free and let’s close her.’ I felt like I was robbing her of her life savings. I felt physically sick.”
Standing outside Malaga airport on a muggy Saturday morning, Neaves says she still feels sick when she sees so many innocent investors heading off with Ocean Estates’ representatives “to live your dream!” “I’m ashamed at what I did and I don’t want any other buyers to suffer. That is why I am talking to The Sunday Times. I worked for Ocean but there are plenty of other firms who pull the same tricks. If anyone is thinking of investing in property in southern Spain, my advice is: be very cautious, don’t go on inspection weekends, go and explore the area on your own first, talk to a number of agents but don’t sign anything until you are 100% happy with your purchase, and get independent legal and financial advice.” That way, she smiles, “you might just find your place in the sun.
Please note – Ocean Estates no longer operate in Spain.