No sale no fee estate agents: What's the catch?
We explore what 'no sale no fee estate agents' are and what the catch is behind this service that sounds too good to be true...
Selling your house can be an expensive process, with fees everywhere you turn. Solicitor fees, estate agent’s fees, removal costs just to name a few. And who wants to pay all these fees if your property doesn’t actually go on to sell?
Well, luckily, there is a solution – sell with a ‘no sale no fee estate agents’.
Never heard of this and have no clue what we’re talking about? Don’t panic, you’re in the right place! We’ll talk you through what a no sale no fee estate agent is, which estate agents offer this and what the catch is to this service (because there must be a catch, right?)
What is no sale no fee estate agents?
No sale no fee estate agents work exactly as they sound, if your property doesn’t sell then you don’t pay any fees. This will mean you only pay your estate agent a percentage of the sale price on completion, which you will often hear referred to as a commission fee.
According to ‘Movewise’, estate agents only sell approximately 50% of the properties on their books. By using a no sale no fee estate agents, you’re reducing the likelihood that you will be in the 50% that don’t sell, as the estate agent is incentivised to sell your property – after all, if they don’t sell, they won’t get paid!
No sale no fee is a more traditional way of paying your estate agents, but you may find that online estate agents offer a different payment method. Little spoiler – we’re going to cover different online estate agents and what they offer later on so make sure to keep an eye out…
What are estate agent fees?
Estate agent fees are a sum of money paid to the estate agent for advertising and selling your property for you. You will hear it referred to as a ‘commission fee’ and is a percentage of the sale price, which you will pay on completion of your property.
Our research showed the average commission fee paid to your estate agent is 1.23% of the sale price but some estate agents will charge up to 3%!
Can I refuse to pay estate agent fees?
Before you enter a contract with an estate agent to sell your property, you will need to be given the ‘pre-contract information’, which is the following:
Details of their charges, the circumstances when you’ll be liable to pay and the total fees (or at least how they will be calculated)
A breakdown of any other charges that you will be liable to pay, such as expenses
Details of any services that they’re offering, or intend to offer, to any prospect buyer (for example, house repayments, insurance, or selling the buyer’s property)
Details of any services that they’re offering, or intend to offer, which give a financial benefit to anyone connected with or known to the estate agent
If this information isn’t given to you before you enter into a contract, then you can refuse to pay the fees and the estate agent won’t be able to claim payment of these fees until they have got a court order against you.
If the estate agent does get a court order against you, the court can decide to grant the order for the full or reduced amount. Or they may even completely refuse to grant the order, meaning you don't have to pay anything!
The decision will depend upon what the court thinks about how much the estate agent is to blame for failing to comply with the law and the damage which has been caused to you as a result.
Do I have to pay estate agent if I pull out of sale?
If you withdraw from the sale, it is normal to expect to be charged to cover the costs the agent has incurred. Although this will not be commission (as the sale didn’t go through), there is still the costs of marketing, photography, floorplans, etc.
You may even be charged some or all of the estate agent’s commission depending on whether or not you signed a contract containing a ‘ready, willing and able purchaser’ clause, which means you still have to pay the estate agent commission for finding a buyer, despite you withdrawing from sale.
Another thing to note is the ‘sole selling rights’ clause, which you may want to avoid. This will mean you can’t sell your property with multiple estate agents and will mean even if you find a buyer yourself, you will still have to pay commission to the estate agent.
Do estate agents charge up front?
As you may have guessed from this whole article being on ‘no sale no fee estate agents’ the answer is no – not all estate agents charge up front. To get a more definite answer than ‘not always’, you will need to speak with your chosen estate agent about their policy.
Paying up front can be seen as a bit more of a gamble because, although you will pay a cheaper price compared to a commission fee on completion, you run the risk of your money ‘going down the drain’ if the estate agent fails to sell the property.
Which estate agents offer no sale no fee?
Most local, or ‘offline’, estate agents will offer a no sale no fee service, meaning they will take care of everything, from photos and floorplans to viewings and negotiations, without asking you to pay a penny until your house sale goes through.
Wanting to find the best local estate agent for you? This quick comparison tool will help you find an answer.
If you’re looking for no sale no fee estate agents that operate online, then there are multiple options – 99 Home, eSale, Yopa and Strike just to name a few. Never heard of these estate agents and want to know a bit more? Well…
Yopa is an online estate agent offering a complete service, just like what your local estate agent will cover. They will visit your property to give you a valuation then, if you’re happy, they will take photos, draw up floorplans and get you listed up onto most property portals.
Yopa also allow you to choose how you would like to pay, whether it’s pay now, pay later or ‘no sale no fee’.
However, at Yopa you’re tied into a minimum of 10 months advertising with them, and you will still be forced to pay the fees if you change your mind within this time, even when choosing the no sale, no fee option. You will also have to pay extra if you don’t want to do the viewings yourself and instead want a Yopa agent to handle the potential buyers.
99 Home are another online estate agency offering you support from the start to end of the process. They offer various different packages, at ranging prices, allowing you to pick the one which works the best for you.
With their most basic package, 99 Home will advertise your property for you on Rightmove, Zoopla and Prime Location and you will do the rest. This means you will have to pay extra for professional photos and a ‘for sale’ sign and if you want help with the sales progression, negotiations and floor planning, then you will need to pay for an upgraded package.
Also, even with the most expensive package, you will only get 10 accompanied viewings. You will also have to pay extra for any virtual tours, an EPC and a premium display on Rightmove and/or Zoopla.
eSale are another online estate agent offering you a customisable service for selling. The website allows you to pick features that you would like as part of the process and ‘add them to basket’.
The standard price will cover the valuations, photos, floorplans and property description. If you want extras such as accompanied viewings, an EPC, videos on Rightmove or virtual tours, you will need to pay extra fees.
eSale also don’t offer a strictly no sale no fee service, with the closest being pay £99 upfront and then a larger sum on completion.
Strike is the final online estate agency we will cover, who offer a free service. The free service covers an in-person valuation, photos, floorplans, ‘for sale’ sign, adverts on Rightmove and Zoopla and support on negotiation through to completion.
Whilst this completely free service looks appealing, you will have to host viewings yourself, unless you’re willing to pay for the hosted viewings service. You will also need to pay fees if you’re wanting to upgrade your ad on Rightmove with some video trailers.
Strike also don’t currently cover all areas of England, with the locations listed on their website limited to Newcastle, Leeds, Liverpool, Manchester and Sheffield.
Whilst all these online ‘no sale no fee estate agents’ will have some aspects that are appealing and some that will make you say, ‘no no no’, it’s important to remember that these services are just to try help you sell your house and, just like your local estate agent, can’t guarantee you a sale.
What’s the catch?
So, no sale no fee all sounds too good to be true, there has to be a catch, right?
Exactly – there is!
Online no sale no fee estate agents charge a premium for the ‘luxury’ of paying on completion. Some online estate agents actually charge double when you use the ‘no sale no fee’ option, compared to if you paid an upfront fee.
Don’t believe us? Just have a look at the examples below:
|Online estate agent||Basic pay upfront fee||No sale no fee pricing|
|99 Home||£99||From £799|
Figures taken from HomeOwners Alliance
As you can clearly see, there’s a big premium from paying a basic fee upfront to taking the ‘no sale no fee’ option and paying on completion.
It’s also important to keep in mind that although no sale no fee means you won’t have to pay if your property doesn’t sell, there may be a minimum number of months you’re tied into, which leaves you wasting time sat on the open market with no guarantee your property will sell.
Is there a way around this, where you can sell your property for free quickly, with the guarantee your property will sell? Yes! And that brings us nicely onto…
Is there an alternative?
As we’ve just hinted at, yes there is an alternative and yes, we’re going to tell you all about it...
If you’re looking at a way to sell your property fast, without paying a single penny and guaranteeing yourself a buyer then look no further, the answer is right underneath your nose – sell to us!
We’re not an estate agent and instead we give you a cash offer to buy your property ourselves. You won’t have to pay a single fee for this service, as we will cover all the legal fees for you.
You don’t need to think about any ‘no sale no fee’ option, as we’re a guaranteed buyer – you accept our offer, we make it happen. Our average completion time is 3 weeks, but we have been known the complete in as little as 7 days!
We only require one quick viewing, to make sure our valuation is as accurate as possible, and whilst our offer may be slightly below market value, it’s a completely cash offer and you won’t pay a single fee!
Think this sounds better than the no sale no fee option you’ve been given? Great - get started by giving us a call or filling in our online form for a no-obligation cash offer, which we could have in your bank by next week!