Estate agent fees are a contentious issue for many. And that was before COVID-19 accelerated already-growing online trends.
RightMove, Zoopla, PrimeLocation and other online portals are now the first port of call for many looking to kick-start the moving process.
Estate agent fees are increasingly controversial because (quite rightly) most people feel that RightMove (and their online counterparts) now do most of the legwork in terms of finding a buyer.
Plus it’s not even a level playing field when it comes to fees — a recent study by Which? Money revealed that when selling a home through a traditional high street estate agent costs can vary by 261% dependent on postcode.
The national average is 1.8% + VAT. So on a property worth £250,000 that works out at £5,400 inclusive of VAT.
So are their (changeable) fees worth it?
It all depends on your priorities and whether you know what you’re doing.
- Estate Agents: There’s no doubt that estate agents charge high fees. But the good ones can be worth it. Exceptional local knowledge, great customer service and fair fees are hard to find, but if you do, then they can secure a better price than you’d get on your own (especially if you’re new to the process). So, if you’re not pressed for time or money, and are lucky to have good local estate agents nearby, then it’s an option to consider.
- Online Agents: The same can’t be said for online agents, and they should be ruled out for most people. They charge upfront fees — that means that as soon as you have signed up then their job is done, whether you sell your home or not. You’re completely on your own and left to manage the process from start to finish, which can be stressful, frustrating and often long. If you do need support, then you can call and speak to someone (usually) but you’ll constantly be speaking to different people and usually to someone that doesn’t know anything about you or your local area.
- Auction: This is often a last resort for many who need to sell their home quickly (divorce, debts, probate are usually top factors). The problem is that it’s a gamble on the night, so you have absolutely no control over the price. So you might get considerably less than you need (or hoped for). Equally, auctions charge high fees. These are payable by the buyer but will be reflective in the price they offer, so it’s still money out of your pocket.
- Property Cash Buying Companies: Focused on speed, they are a great option if you need to move quickly. There is no middleman and no fees, so once you agree to a price then it’s more or less a guaranteed sale. Local companies are always better than national companies though as they tend to operate much more transparently and fairly: they have a reputation to protect so won’t change their offer at the 11th hour; they have local knowledge so will offer a fair price; and the same person will hold your hand every step of the way. Cash buying companies do tend to offer slightly less than market value but it’s a price worth paying for a secure sale, certainty and speed.