The typical estate agent fees are NOT as low as you'd think - we put 15 local agents to the test...
Estate agent fees aren't cheap - face it. If anything they're the type of fee that has to be justified in order to make any sort of logical sense. You see, there's a reason agents will hit you with a ream of questions as soon as you mention the phrase 'estate agent selling fees'.
They're assessing you. Trying to work out how much commission they'll be able to eeek out of you, before that smile on your face starts warping into a frown. That's right - unfortunately for Joe Public in the eyes of estate agents, commission is what makes the world go round. House sales are merely a way of producing this golden commodity. Hence why they'll do anything in their power to sway their chances.
And by anything, we mean anything. This could be steering you on to the subject of typical estate agent fees in hope that you'll reveal the hand of competitor agents. Or simply battling to be the last agent through the door. Whatever their tactics though, they're all there for one reason - to get you on their side and influence the size of the fee. So, how much do estate agents charge in 2021? Well, that's something we decided to find out by going undercover and quizzing 15 local agents on certain aspects of their service, namely their fees. Read on to see our findings.
Here to track down something specific about estate agent selling fees? Or, to delve deeper into estate agent costs? Use the menu below to find the information you need fast...
- How has the Stamp Duty Holiday affected estate agent selling fees?
- What to look out for when negotiating estate agent commission
- How much do estate agents charge in 2021?
- Are estate agent fees something you can avoid in 2021?
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The Stamp Duty Holiday - it's one of those ripples that the housing market isn't going to forget in a hurry. With buyers being able to save as much as £15k in SDLT, the amount of property sales since June 2020 has skyrocketed. And now in 2021, there's even fears that there's going to be a shortage of homes coming to the market. A potential drought, perhaps?
Nevertheless, the Holiday has not only had a significant impact on the habits of buyers, but also the average estate agent fees as well as the overall value they provide too. So, to help you understand how the Stamp Duty Holiday has impacted both buyers and agents alike, we've listed just a couple of the impacts...
Estate agent fees have dipped, slightly - You'd assume that what with the sheer demand caused by The Stamp Duty Holiday, that the typical estate agent commission would plummet - but no. While it may have reduced slightly, from what we found, it's not exactly what you'd call plummeted. Which if you ask us, is surprising.
You see a large selling feature of any agent is their reputation; things like their star rating on Google, the amount of testimonials on their website and crucially, how many properties they have on their books. So, naturally you'd assume that as a way to capture more business at this highly competitive time, agent fees for selling a house would reduce, especially amongst independents. Besides, if a few low-fee deals entice a chunk of sellers to side with that agent, they've practically paid for themselves.
FYI: Put an agent on the spot about their barren stock list and they may throw you a curveball, claiming that the reason behind their low stock is because they've sold it all. Now whether that's the case or not entirely depends on the agent, but in most cases, we'd be suspicious. Ask them for a list of their recently sold properties and you may find out that the truth is otherwise.
- Agents have less time for you - Now, while houses are selling reasonably fast (for open market standards anyway), this isn't necessarily great news for sellers. You see, while it may be fast for an agent to mark your property as Sold STC, it doesn't mean that getting your sale through to completion is any quicker. Fact is, like the rest of us, an agent only has 24 hours in the day. And if more of that is taken up with instructing new properties and negotiating offers, then pushing sales through is a task that gets consigned to the backburner. A aspect of service that you do not pay for in your estate agent fees.
You're liable for viewings - As you'd expect, with less time being on their hands and of course Covid to fall back on, in 2021 agents will be very keen for you to host your own viewings. And while you can understand it will save them time, it's hardly fair on you, especially if you're not in job where you can work from home, or if you're selling an inherited property and live far away. And then of course you've got to ask yourself, has the lack of viewing support been factored into estate agent fees?
Simple answer - nope. Not only does this make no difference to the rate you'll be charged, but it also means you'll be advised to foot an extra cost and get yourself a virtual tour. Charming!
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When it comes to negoitating estate agent commission, there's various signs that you should be on the lookout for. You see, in the end negotiating commission with an agent is nothing more than a petty little sales game, where you have to be prepared - there's no maybe about it.
Agents are polished professionals at this game and hold all the trump cards, so to not go in with a strategy, or at least an awareness of what to expect, is downright foolish. Do so and you'll have already sown the seeds of your own defeat before Mr Estate agent has even walked in the door. So to help you prepare to negotiate the fees for selling a house and not fall into the agent's trap, here are just five ways that you can ensure you get a somewhat reasonable deal...
- Say nothing about their competitors - You may think that telling an agent about a fee from another agent is a good idea, especially if they're a close competitor. It'll add tension into the mix and encourage them to give you their best price, right? Wrong. Reveal the cards of a competitor and all you're doing is giving the agent something to aim for. For instance, if you tell them that Agent X has offered 1.25%, they'll most likely base their figure on that. For all you know they could have been thinking of offering 1%, but because you've proudly stated that Agent X has offered more, they know they'll likely be able to get away with matching it. In some instances, disclosing someone else's fee may even tell an agent what the house is worth. If they know Agent X only goes as low as 1% on anything over £500k, then yet again, you've given them more intel which = a tactical advantage.
- The classic 'do you have any idea what the house is worth?' - NO! NO! NO! That should always be your answer to this question. If you do, play the dumb card and let the agent work it out for themselves. You've hired them to value your property, so where's the sense in answering the question for them? Even if it's just a figure you want to achieve, not necessarily the value, it still gives them an idea of what you expect as a seller. So if they know for a fact that they can get at least £300k for your house and you're there saying you'd like £250k, they know they can easily market it for £275k and get some fast commission. Meanwhile, you're clueless to the fact you've actually lost out, so when they drop their fee, you snap their hand off and move on, unaware that instead of saving a couple of hundred pounds, you could have been up another £20k.
- Ask about the VAT - Estate agent fees can be complex. You see, on paper an agent is legally required to state their price inclusive of VAT, but that doesn't stop them negotiating their fees verbally on a plus VAT basis. So before you launch yourself into negotiations, stand back and properly take time to assess the initial fee posed to you by an agent. Is it inclusive of VAT? Is it not? In fact, if you've had multiple valuations then it'd be wise to translate all your prices into either + VAT or VAT inclusive, to make them easier to compare. Remember, VAT is 20% of estate agent fees, so forgetting about it can cause quite the financial dent. For instance, 2.5% + VAT is actually the equivalent of 3% including VAT.
- Don't accept the initial figure - As a general rule of thumb when it comes to estate agent commission, never accept the first figure. Why? Because the agent is praying that you just accept it a necessary cost of selling. But just like a car salesman, it not the lowest they'll go - it's merely a starting point. They'll likely have a whole negotiation plan mapped out in their head. Scenarios and everything. But, if you don't tap into it, then you don't stand a chance of bagging yourself the best deal. Even if money's no object, saving yourself a couple of hundred pounds for simply frowning and repeating the sound 'UMMM' a few times, seems like a pretty good deal to us.
Agent being cheeky with their fees? (newsflash) we don't charge them...
Unsure of how to grill an estate agent or after some guidance? Take a read of our top 30 questions to ask estate agents when selling.
So, what with all the predictions of housing market spiking (and crashing), we gathered that the average estate agent fees in 2021, would be question that a lot of you would be eager to know. Only if you search around online, there isn't really much to be found, merely a ream of claims (cough - predictions) about what the housing market will look like in X amount of years. So we decided to do our own research and went undercover to quiz 15 agents on their selling fees.
The area we chose to target was Leeds, in West Yorkshire. Why? Because it's a vibrant city with a real mix of land use, property and therefore house prices. Those looking for a property in LS1 will likely need a deep pocket, whereas if you go further out towards LS10/11, you're more likely find something that's more affordable. Even out the outskirts prices vary, with areas to the North like Wetherby demanding more of a premium than those to the south like Morley. Plus, neither is Leeds stuck in a price bubble like London. We should know - we have offices in both cities.
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The 15 agents we contacted to discuss commission were:
- Linley & Simpson (Chapel Allerton)
- Hunters (Pudsey)
- Bridgefords (Leeds City Centre)
- Martins & Co (Horseforth)
- Preston Baker (Roundhay)
- Your Move (Crossgates)
- Cornerstone (Meanwood)
- Sanderson Weatherall (Leeds City Centre)
- Dacre Son & Hartley (Morley)
- Maxwell Hodgson (Wetherby)
- Beadnall Copley (Wetherby)
- Rent & Parr (Wetherby)
- Manning Stainton (Garforth)
- William H Brown (Yeadon)
- Haart (Leeds City Centre)
Average estate agent commission in 2021
So what did we discover? Well, we found that some estate agent commission is common knowledge, whereas with other agents, it's a far more 'specific' affair. By that we mean they won't divulge a number unless you tell them a rough estimate as to what your house is worth. In other words, you tell them the value, before they come to value it. Tactics aside, we also discovered that independent agents tended to be more friendly in the way they dealt with us, opposed to those that are part of a larger group. But anyway, what percentage do estate agents take in 2021? Here's your answer...
Overall the average fee we were quoted = 1.23% (£3690)
FYI: The typical estate agent fees don't stop there. Sell through an agent and you'll also have to cover photography and marketing costs, an EPC and even a virtual viewing thanks to Covid.
*The estate agent fees quoted were based on a house that 'we believed' (in other words, told the agent) was in their patch and worth £300k. Eight of the agents quoted us 1% with the highest fee touching on 2%. We won't reveal what agent quoted what price - think it's safe to say this blog has probably ruffled enough feathers as it is.
Agents ruffling your feathers? We'll be your buyer
Thankfully, yes - the estate agents fees for selling a house can be avoided altogether.
While estate agencies may be the traditional route of selling your home, don't be fooled into thinking that they're your only option. In fact, there's plenty ways to sell your house, be it through the open market or by going off-market altogether. So to limit yourself to agents makes no sense, especially when their fees can wrack up into the thousands. Contrast that to some of the fee-free options below and you could be in for a healthy saving.So with that in mind, here's just a few alternative ways to sell your house that could help you avoid estate agent fees full stop...
- Go to auction to avoid estate agent fees - One of the simplest ways to cut out an agent is to auction your property instead. Basically the same as what the agent would do, only this takes a matter of weeks, opposed to months. It also takes the need for negotiation out of the equation too, which avoids any of the agent's personal motives getting in your way. However, auctions don't come without their risks. Auction your property and there's always the risk it won't even sell, be that because there's low demand or your pricy strategy wasn't the best.
- Leave behind estate agent costs with a private sale - Fed up with the how much estate agents charge? If you know a friend or family member who'd want to buy your property, then a private sale may be the best way to go. And even if you don't, a private sale can still be a viable route, only it'll take lot more time and marketing nous, as you'll be left to source your own buyer. However, there are a good number of websites out there that will allow you to market your property for FREE! But, you'll have to vet each buyer and conduct the viewings too. Tasks you'd usually assign to an agent. So if you're looking to sell your house fast, then a private sale may be more hassle than it's worth, depending on your situation of course.
- Sell to a property buying company (us, perhaps) - It's ironic, but the quickest way to avoid agent fees for selling a house would be to go through a cash homebuyer like us. We've been under your nose this entire time.
You see, our team of property pros have over 50 years' experience in buying homes for CASH, across both England and Wales. What's more, unlike agents we don't charge fees - in fact, we do the complete reverse. We cover them all for you, so you have to pay NO solicitor costs and NO survey costs either. We even help you negotiate on your ownward purchase if we think we can get you a better deal.
All of which means that selling your house through us is about as complex as 1-2-3 and neither is it a lucky dip either. The CASH offer you recieve, is the amount that will be transferred directly into your bank account upon completion. So just to be clear, that can be in as little as 7-days (jaw drop)!
Want to wave the open market behind? Then, what are you waiting for?