Estate Agent Fees

How to deal with an Estate Agent.

An ever- increasing number of people are now buying properties over the internet although they are definitely in the minority. Most buyers still purchase their properties through an Estate Agent.

Most Estate Agents give free valuations to sellers

The Estate Agents job is to match buyers with properties that are for sale. He will market the property on behalf of the seller and he can show prospective buyers around the property .He will pass any offers onto the seller and help the buyer and seller come to an agreement on the price.

The further South you go the more it will cost to sell your property When the property market is moving quickly the agent is more likely to agree a lower fee and obviously in a slow market fees will be higher.

The Estate Agent works for the seller because the seller pays the agents fees. He must pass all offers for the property on to the seller .If your offer is accepted by the seller and another higher offer is later made the Estate Agent must pass the higher offer onto the seller .If the seller accepts the new offer this is called Gazumping which is perfectly legal .To avoid this you should ask the Estate Agent to approach the seller and confirm that no other offers will be accepted and that the property will be taken off the market. Your solicitor can help with this. The Agent is however legally obliged to treat the buyer fairly

Try to ask the right questions-
How well do you know the area?
How many homes have you sold in the area recently?
How did you arrive at the price that you recommend we market our property for?
Will you contact us on a weekly basis to report progress?

If a buyer has been unable to find a property in a desired area he can ask the Estate Agent for a list of suitable properties in the area according to price .The agent will usually have something to suit your requirements If not he will be able to put you on his mailing list and he will contact you as soon as something suitable comes along. He can then show you around the property and he may also advise you about what sort of offer to make.
If you are short of time an Agent will do a home search to find you a property. He will also negotiate a price on your behalf. You will pay one to three percent for this service.
If as a seller you need a quick sale you could use several Agents but this will cost you more.

Other Services
Many Estate Agents will offer mortgages or they could refer you to a lender with whom they have an agreement. It would not be to your advantage to take a mortgage or loan through your Estate Agent. They will only have a small selection of lenders and you will not get a very favourable rate.
Mortgage Fox will be pleased to offer you a competitive quote- click here
The Agent may recommend a Solicitor to you .If you don’t already have one this may be a good idea. Ask for a quotation but do not feel under any pressure.

When choosing an Estate Agent the seller or buyer should make sure that the Agent is a member of the Ombudsman for Estate Agents (OEA) Scheme. If anything does go wrong they will help you to fight for compensation. Membership is voluntary.
Members of the National Association of Estate Agents or Agents who are registered with the Royal Institute of Chartered Surveyors also follow a strict code of practice.
Most complaints made against Estate Agents are against agents who are not members of the above Organisations.
Commission and Contract
Anyone selling their property through an Estate Agent has to pay a fee, which is the Agents commission. . Always haggle over the fee.
The commission is usually between one and three percent of the sale price. Check to see if VAT is included.
Always read the small print and ask what services are included in the fee ie:-
Valuation of the property
Sale boards
Property brochures
Advertising
Arranging and conducting viewings
Negotiating offers.
If any of the above are not included in the commission ask how much you will have to pay and check that this is shown on the contract.

The contract should give details of the cost of any services not included Ask how long the contract is for and if you have the right to cancel You may wish to change Agents if the property has not been sold but you will have incurred some costs such as brochures and viewings. There may be a penalty for changing.
Agents. If you take your home off the market you do not usually have to pay any commission but you will have to pay for any expenses incurred.
There are different types of contract, which can affect how much you pay. Always discuss the details with the Agent.
Look to see if the contract states ‘sole agency’ or ‘sole selling rights’

Sole Selling Rights
This means that only the Estate Agent has the right to sell your home. If you sell the property yourself you will still be liable for the agents fees.

Sole Agency
This means you will not have to pay any commission if you find your own buyer although you may have to pay marketing costs.

Ready Willing and Able
It is important that you never agree to this. You will have to pay the agency commission wether or not the property is sold.

Complaints

If you feel that you have been unfairly treated always talk to the Agent first. If nothing is resolved try contacting the Head Office.
If you need to take things further contact the Ombudsman for Estate Agents (OEA) - www.oea.co.uk
Other contacts are National Association for estate Agents – www.naea.co.uk
Citizens Advise Bureau – www.citizensadvice.org.uk
The Office of Fair Trading – www.oft.gov.uk