MSE News: Guest comment: Buyers and sellers are being ripped off by agents

ESexpat

eddddy wrote: »

This is ridiculous.

All that's needed is clear transparent pricing. For example, Agents' contracts should just say:

Estate Agent 1
We charge sellers 1.5% and we charge buyers 0%

Estate Agent 2
We charge sellers £200 and we charge buyers 2%

Estate agent 3
We charge sellers 0.5% and we charge buyers 0.5%

The government shouldn't be 'micro-managing' / 'micro-legislating' like this - they should be addressing this type of consumer issue at a much higher level.

They should be legislating to make sure that all businesses (including Estate Agents) display prices clearly and fairly, and much more importantly, helping to educate people to be 'savvy consumers' who can make their own optimal decisions.

These are rates that we can only dream about in Spain. The average EA charges sellers 5% commission, plus 21% Vat, many also charge buyers a fee/premium.

Mikeeuropa

googler wrote: »

If the only source of income is the successful sales, where's the income going to come from to pay for all the time spent with viewers and buyers who don't buy?

Errr... from the sellers fee just like it always has done.

Mikeeuropa

Credit-Crunched wrote: »

car0line123 wrote: »

Does someone know where this "charging a buyer fees" come from? (England). I've never heard of it until today.

I think it is in reference to Buy To Let purchases, where they charge an introducers fee to find the tenants?

However, the usual sloppy, ill researched article that beleaguers this site, makes it hard to tell.

If you actually read the article you see it says...

"In estate agencies a new form of contract is becoming more and more popular. The 'sale by informal tender' contract, which involves using sealed bids to make offers on properties.

Increasingly, agents are then charging the successful bidder an 'introductory' fee – in some cases of 2%-2.5% of the property price, plus VAT....."

Also...
"Such costly conflicts of interest don't just occur in the sale of property. Tenants and landlords both pay their letting agent for arranging their tenancy contracts.....

These problems reflect how the only beneficiary when an agent is able to charge both the buyer and the seller, or the tenant and the landlord, is the agent's bank balance. We believe such conflicts of interests are bad for consumers and bad for the housing market."

Why is that "sloppy, ill researched"?

Mikeeuropa

Naf wrote: »

Wouldn't help very much. The market isn't like a supermarket where the same product is sold at the next one down the road so you can easily go there; the property you're looking at is at just one agent, so you're forced to deal with whatever hoops they decide to make you jump through.You can't just go to another agent and expect to find what you need there instead - you have to get it where you see it, and quick!

Agree entirely, the seller has free choice of agent but the buyer doesn't. And the seller isn't going to know if people are voting with their feet because they're not going to be told by the agent that buyers are interested but walking away because of the fee.

Mikeeuropa

Pincher wrote: »

If the principle of building in the time waster overhead into the successful deals is correct, then it make every sense to charge buyers who actually buys for all the time wasting buyers too.

So if you go and buy a car you'd be happy to pay extra for the time wasted by all the tyre kickers before you?

googler

Mikeeuropa wrote: »

So if you go and buy a car you'd be happy to pay extra for the time wasted by all the tyre kickers before you?

You do already, whether you're happy about it or not. You pay for the dealer's 'overheads' or 'outlays'.

googler

Mikeeuropa wrote: »

If you actually read the article you see it says...

"In estate agencies a new form of contract is becoming more and more popular. The 'sale by informal tender' contract, which involves using sealed bids to make offers on properties.

But as you can see from some of the replies above, the occurrence of this is declining as the 'property hotspot' effect is waning from the districts the posters above mentioned. They don't agree it's 'becoming more popular'

Mikeeuropa

googler wrote: »

You do already, whether you're happy about it or not. You pay for the dealer's 'overheads' or 'outlays'.

Exactly, it's in the price already, just as the estate agents fees are in the selling price already too.

Mikeeuropa

googler wrote: »

But as you can see from some of the replies above, the occurrence of this is declining as the 'property hotspot' effect is waning from the districts the posters above mentioned. They don't agree it's 'becoming more popular'

Just because it's waning currently doesn't mean it won't come back. I agree with TrixA who said...
"What has happened since is that the market has quietened down dramatically, and the practice has all but disappeared. However, I would still like to see it regulated against for much the same reason I favour regulation of other practices that exploit desperate people with limited options (payday lenders spring to mind). I would not want it to become an accepted practice in the way letting agent fees charged to tenants have."

Thrugelmir

cepheus wrote: »

I see the Estate agency crowd have cornered this board, what a surprise.

It's long past time we stopped using traditional Estate agents altogether for standard properties. Fees exceeding £1,000 in total, can rarely be justified, sometimes only a fraction of that for what they do.

There's nothing inconsistent with Stella Creasy writing for MSE who has supported consumer rights across various campaigns. However allowing David Cameron on MSE whose party is mainly bankrolled from companies who rip off consumers was an outrage.

This is a housing board. Not a political one.