7 mins read
Once you’ve decided that you want to sell your property, the next step is to think about the right estate agent. Understandably, many homeowners pick the cheapest estate agent on the market to save them a pretty penny, whilst others take the sale of their property into their own hands and list with an online estate agent, with some promising to help sell your home for less than £1,000. Understanding agent fees before you make a decision is important.
The truth is, estate agent fees can vary enormously from city to city, and there can be huge discrepancies between high street estate agents operating in the same region. Therefore, it’s important to understand exactly what your agent fees cover, to ensure you’re getting good value for money and sell your home without having to hand over a fortune to your agent.
To help you understand estate agent fees, we’ve put together everything you need to know in this handy guide, and rounded up some of the factors that may influence your final bill…
Choosing commission or fixed fee
The UK estate agent sector has never been more competitive, with consumers able to choose from a growing number of high street and online providers. Because of this, many sellers are becoming savvier when listing their homes, which is understandable, especially when you take into consideration the rising cost of living. To combat this, some estate agents now offer a fixed-fee service, so that you know what you’ll pay up-front, with no hidden fees.
Other agents charge a commission for their time and services - in other words, a percentage of the final sale price, and this can range anywhere from one to five per cent, which can turn out to be pretty expensive (for a £400,000 property, a 3% commission would cost £12,000).
Opting for a fixed-fee service, on the other hand, means you’ll pay a specific price and you’ll get a ‘bare minimum’ service. Remember: estate agents on commission are likely to be more incentivised and motivated to sell your property and help you achieve its maximum possible value. If you’re paying £800 up front, then agents will charge extra for additional services like floor plans, viewings, and sales negotiation, so bear that in mind before making a decision.
Both online and high street estate agents should offer a minimum of the following:
● A property valuation based on sales data, trends, and local market performance
● Professional photography showing off the interior and exterior of your property
● A ‘for sale’ board to encourage house-hunters to inquire about making a viewing
● Online marketing of your property on sites like Zoopla and Rightmove
● Floor plans and measurements of your home (maybe an extra on fixed-fee packages)
● Assisted viewings (might be extra on fixed-fee - Purplebricks charges £300)
What’s attractive about fixed-fee packages is that agents often allow homeowners to pay at a later date, although you should read into the terms and conditions and ensure you won’t be charged any interest. And remember: with a fixed-fee agent, you pay even if you don’t sell your property, whereas commission-based agents only charge when a sale is agreed
Paying your estate agent
Most estate agents send an invoice upon the completion of a property sale, although some will require you to pay upfront. Make sure you check the agreement of your agency and ask for their advice if you don’t understand the legal jargon; getting everything written down on paper or in an email will give you power should you run into an issue and need to dispute it.
Typically, though, estate agents will send their invoice to your solicitor, and they will settle the bill out of the proceeds of your property sale, before transferring the remaining balance to your account. And a word of advice: some estate agencies only give you a few days before they start to charge interest, so read into your contract and pay as soon as you possibly can.
Don’t forget the extras
Just as in any industry, some estate agents offer additional extras to increase the likelihood of selling your home or make the process more convenient for you. These extras are often charged at an additional fee, so make sure you understand what is included in a standard package and what else you’ll be liable to pay. Some extras are payable upon completion, whereas others require sellers to pay within ten working days before interest is compounded.
Extras such as EPC assessments are commonly charged at an additional fee, but it’s worth looking into private companies who can offer such services at a cheaper price. In fact, many estate agents resell “extras” from third-party companies, so do your research and, if there’s a big difference between the estate agent fee and going private, consider arranging it yourself.
Other extras like premium listings on Rightmove and Zoopla can help you get more eyeballs on your property listing, but you should weigh up the pros and cons and decide how much value you think you’ll get before going ahead. If an agent is pushy, ask them for some time and go away to have a chat with your partner - don’t pay for services you simply don’t need.
Understanding the contract
A common stumbling block amongst homeowners is the estate agent contract, which is often many pages long and full of jargon. If there’s something you don’t understand, speak with your solicitor or the estate agent for clarification, and remember that the internet and forums like Money Saving Expert are full of free advice from homeowners in a similar boat to you.
Your contract will probably include a minimum term period, which prevents you from working with other estate agents for a specified period. This is usually between one and three months but can vary - and if you terminate or breach the contract early, you could be charged a fee.
You should note that some estate agents charge withdrawal fees if you decide to take your property off the market, so don’t instruct an agent before you’re certain you want to sell.
What to ask your agent
It would be impossible for us to list every possible fee your estate agent may charge as each estate agency is different. However, we thought we’d round out this article by arming you with a list of questions to ask you estate agent before instructing an agent to choose the right one for your budget and circumstances and to prevent the likelihood of you getting ripped off.
● Are professional photographs and floor plans included?
● Are there any additional charges for marketing my property?
● Is VAT payable on top of your standard fee?
● What if I decide I want to work with another estate agent?
● What if I decide to take my property down from sale?
● What is and is not included in your standard fee?
● What is your policy on interest if my payment to you is delayed?
● Where will my property be advertised? Will I be on major online property sites?
● Will you charge me for arranging property viewings?
● Will you install a “for sale” sign at my home, and will I be charged?
When listing your property for sale, it’s natural to want to choose the cheapest agent, but the cheapest doesn’t always represent the best value for money. Start your search on GetAgent, our FREE online estate agent comparison tool that provides historical sales data on agents in your local area help you make the right decision, and sell your home at break-neck speed.
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