When it comes to how to compare estate agent fees, you might have a lot of questions. How much do estate agents normally cost? And how much should they cost? Why are online estate agents different — and how can they be so much cheaper?
Don’t worry, there’s actually a lot of variation when talking about how to compare estate agent fees. But we’ll take it one step at a time.
How much are estate agent fees typically?
In short? A lot. Traditional estate agents fees range from 0.75% to 3%, but normally they hover at around the 1.5% mark. So on a £250,000 house that’s a whopping £3,750.
And not everyone works in percentages. Some estate agents have started offering flat-rate fees. And some agents say they’re free, but the fine print says otherwise — that’s why we think it’s so important to be upfront.
We can’t speak for everyone, because every estate agent is different. Some estate agents make you pay at the start, some wait until completion. Some even want you to pay regardless of whether or not they sell your home — just an FYI, at Property Deck we don’t deal with those estate agents. You can be assured that all of our agents are vetted even before they are granted access to our platform.
What should you watch out for?
Be careful of inflated appraisals
Almost all agents will offer a free market appraisal of your property, and it’s a critical part of the package with which they hope to win your listing. But that’s just it: they want your business – so how can you trust their opinion of your property? Of course, you need to be aware that there are some untrustworthy agents who will quote inflated prices in an attempt to win your listing; but if an appraisal seems unrealistic or doesn’t match up with what other agents are saying , all you have to do is ask how they arrived at their figures. You’ll be able to spot the decent estate agents because they won’t just pull a figure out of thin air. They should give you a price range, not an exact amount, based on their professional market knowledge, an understanding of current conditions like recent sales in and around your local area, and the unique selling points of your particular property.
If, after all this, an estate agent’s appraisal still seems high you can always protect yourself from the over-quoting trap by asking the agent to sign a quotation guarantee. This involves getting a signed copy of the quotation with a written agreement stating that the agent won’t receive payment unless a minimum sale price is reached.
Why Use Property Deck?
Let the estate agents compete over you. Choose your favourite agents based on their fee, valuation, availability, ratings, reviews, sale time, personality and overall proposal. Best of all, Property Deck is completely FREE.
Are cheaper estate agents really cheaper?
You’re selling your home, obviously, you want to get the highest possible return overall from the sale. A classic mistake when thinking this through is to assume that lower commission equals higher return. When focusing only on commission you miss the crucial consideration of how much you actually end up with in your pocket at the end of the day. Because agents differ in quality and style, choosing one on the sole basis their commission can very easily leave you feeling short-changed.
Let’s crunch the numbers on a £300,000 property:
Consider a situation in which your house has just been valued at £300,000. After doing some basic research on Property Deck, you find out that agents in your area typically charge a 1.5% commission on sales. If your home sells for £300,000 and you pay the average fee of 1.5%, you’d be forking out £4,500 for the agents and taking home £295,500 of your own, before other costs such as solicitor fees and removal costs.
Consider a second scenario in which you decide to go with an agent who quotes a lower commission of 1.0%. There are many valid reasons they might charge lower commission:
- They might only be newly qualified, and eager to get as much experience selling homes in your area as possible.
- They might be desperate for listings.
- Lastly, they might be relatively similar to all the other agents, but offering a lower price because they will spend less time on you and your property.
Such an agent, cheaper for whatever reason, might then end up selling your property for only £285,000 – not a significant amount less than the average priced agents. The 1.0% commission on that £285,000 is only £2,850 (much cheaper than £4,500). But you’re only left with £282,150 at the end of the deal – that’s £13,350 less! Plus you have the added headache of working with an inexperienced or unmotivated agent.
From this basic exercise you can see that you’d be better off going with the more expensive agent. In most cases a higher commission is justified by a proven track record and good customer feedback, which are indicative of greater overall return at the end of the day.
Negotiating fees with your agent
Remember they won’t want you to compare estate agent fees. The average commission that real estate agents charge varies between counties and between city vs. rural areas – the lowest is about 0.75% and the highest about 3%. Across the country, the average charge is around 1.3% to 1.6% of the sale price of your home.
But agents don’t all structure their fees in the same way: some include the cost of advertising in the commission and quote a higher rate; others will use a ‘sliding scale’ commission, e.g. 2% on the first £200,000, and 3% on anything above that, which acts as an incentive to work harder for a higher sale price (a practice quite common on more expensive properties).
What’s important to remember from all this is that commission structures are flexible. In fact it is common to negotiate.
Here are Property Deck’s tips on negotiating a commission that will give you the best of both worlds, value for money and a great price for your home.
- Shortlist your agents
After you’ve whittled down to a shortlist of a few agents and their proposals, ask them each what their commission is. And don’t be shy – let them know you’ll be comparing them against one another. This way you might be able to get an agent you like more to “price match” against a competitor. Don’t worry the Property Deck platform will give you all of this information upfront.
- You get what you pay for
If you want a record price for your house, don’t expect an agent to drop their fee. Record prices require much more work, and you’ll obviously have to pay a premium on it.
- Incentivise your estate agent
Consider asking for a sliding scale rate structure (like the one illustrated above). The idea is to incentivise the agent to secure you a better selling price.
- Don’t just rollover and settle
Don’t just settle for the agent with the cheapest commission. As already discussed, more often than not you get what you pay for.
- Make sure it’s all included
To make sure you’re comparing apples with apples, include the advertising fees in your cost estimates since they may or may not be included in an agent’s quoted commission.
- Got a valuable house? Negotiate the commission rate
Don’t forget that if your house is worth more than average, you can probably negotiate with the agent on a lower commission rate.
- Don’t be afraid to haggle
When it comes to negotiations don’t be shy – haggle on all the fees and costs. Of course, the agents won’t tell you this, but everything is negotiable.
- Write it down
Lastly, make sure you get all fees and costs in writing from the word go. That way you won’t be left high and dry when it comes to selling time.
Paying an agent
When do you pay your estate agent? With traditional agents, you won’t pay until you’ve closed on the property. Technically the fees are often due upon exchange of contract, but most estate agents will have a “no sale, no fee” rule — which basically means you don’t have to pay them until there’s money in the bank.
If you see withdrawal fees or a “ready, willing and able purchaser” contract, you should probably keep looking for an estate agent with better terms.
Remember Property Deck is FREE for home owners and always will be, We don’t take a dime! Remember we give you all the information you need, including fees in an upfront and transparent manner meaning you don’t have to waste time and effort manually compare estate agent fees. TRY IT NOW
Did You Know?
Less than half of all home sellers achieve a sale with the first agent they choose. We solve that problem!
We understand that every person’s circumstances and selling journey is different. That’s why our platform allows you to choose the agent that is the best fit to sell your home. Whether your driven by saving money or getting a first-class service, you can be assured that Property Deck will allow your selling journey to be less stressful.