3 mins read
Knowing whether you’re getting the best deal with your estate agent is always difficult. You don’t want to pay too little - you need a high quality service from the person handling one of your largest financial assets. But you also don’t want to end up paying a high price if your agent isn’t up to scratch. Being aware of how much an estate agent usually costs, and what to expect performance-wise, will help you figure out whether you’re paying the right price.
It’s unusual for an estate agent to have a set fee on their website, because each home sale is unique. However, you can expect an estate agent’s fee to usually be around 1% to 3.5% of the final sales price of the property.
Are they worth the fee?
It may seem like common sense that you should expect a lower quality service from a cheaper agent. But, when most of the agents in your area are charging a similar fee, how do you know which one is the best?
A good place to start is to have a look at their track record. How well has the estate agent valued homes like yours in the past? You can find this out by looking at how many of their recently sold properties were reduced in price before a buyer was found. Agents who know the local market well, and have the best selling skills, won’t have to reduce the asking price as often. And, when they do reduce the price, the decreases will be small.
Once you know how often an estate agent reduces asking prices, take a look at how long they usually take to sell a property. Is it in line with the average for your area? If an agent is taking longer than average to sell homes, it’s a sign that they don’t have strong connections with local interested buyers. Or, that their marketing isn’t as good as other local agencies.
For an easy way to see how your agent stacks up, take a look at our area analysis tools. Here you’ll find information about the average sales price of homes in your area, along with how long it’s likely to take to sell, and what sort of price reduction is normal. We analyse huge amounts of historic sales data, so that you can get an accurate understanding of the property market in your area.
If your agent ticks all these boxes you can have confidence that you’re paying the right fee. The best agents are worth the fee because they’re able to sell quickly and at asking price.
Other things you should take into account
The local property market
When thinking about your estate agent fee, it’s also important to take into account the wider context of the local property market. In areas where there are lots of interested buyers, estate agents are likely to charge a lower rate of commission, because properties are easier to sell. Moreover, in some areas certain types of property are easier to sell. For example, in cities with lots of young professionals there’s going to be greater interest in flats. In suburbs and commuter towns it’s easier to sell homes designed for families. Estate agents are likely to consider this when setting their commission fee.
Commission fees vs. upfront fees
Some agents now charge a fixed fee upfront. Although this is usually a cheaper option, this fee is payable even if the estate agent does not end up selling your home. A commission fee provides a much greater incentive to an agent to sell your home quickly and at the best price - because they’ll only get paid once they do.
Anything that’s required to help the sale of your property is included in your agent’s fee. Things like marketing, lead management and valuation guidance are standard and shouldn’t cost more.
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