0% Commission?

Dave369

Now mortgage-free on our East London home, we have decided to sell-up and move out of town. Of the various agents who have valued the property, one is offering to market the house at 0% commission!
I realise that, at long last, Waltham Forest is now a desirable area, but how is it possible for them to do this? One of the other agents suggested it may be because they have eager buyers on their books who are willing to cover the seller's fee in order to get first refusal on the property and that, consequently, they may not market as aggressively as agents who are actually getting paid by the seller...or maybe that was just sour grapes.
Has anyone come across this arrangement before, or the agent offering such a deal, EAEO?
They say there's no such thing as a free lunch, so any assistance or helpful advice would be much appreciated.

ellie27

How much is their upfront marketing fees?

davidmcn

Almost certainly by charging the purchasers rather more than 0%.

Surrey_EA

I've only heard of 0% commission being offered when a new office has opened and they're trying to build market share.

Certainly need to explore where they intend to get a fee from, because as the other agent points out, if they're receiving a fee from the buyer that may well change where their focus and obligations lie.

Dave369

Thanks for all your replies so far,

@ellie27 - Nothing! They are asking no fee from us at all!

@Surrey_EA - They seem to have operated for a few years in the high-end rental market in Docklands but are now looking to expand into the East London market and told us that to build up their portfolio in the area they have decided to offer the 0% commission deal. They have also just opened a shop within the area, so they seem to be genuine...

ellie27

So they want to sell your house quickly to add to their sales book.

It may be they recommend you market your property at a low price to sell quick? Just make sure you get several agents round to see what they think you could sell for. Do you have an idea of how much you should be able to get for your place?

G_M

wish I could persuade Sainsburys to do the same....

Surrey_EA

Dave369 wrote: »

@Surrey_EA - They seem to have operated for a few years in the high-end rental market in Docklands but are now looking to expand into the East London market and told us that to build up their portfolio in the area they have decided to offer the 0% commission deal. They have also just opened a shop within the area, so they seem to be genuine...

It's a tactic Foxtons often employ when they open a new office for a limited period to gain new instructions/market share.

Might just be one of those times in life when you're in the right place at the right time!
ETA: But, make sure you go through the ts & cs carefully, in case there's something hidden in there that means you end up paying something. Sometimes a time limit for completion to take place in exists, and if you fall outside that a fee is due.

eddddy

Over the years I've seen a few EAs offer 0% deals when they move into new markets or new areas.

It seems like a legitimate way to get established. No seller is keen to instruct an EA with no (or very few) other properties on their books, so the EA has to take 'drastic' measures to persuade the first few sellers to get on board.

Dave369

Thank you all! If it's a known marketing ploy by a new EA trying to establish itself, my fears are allayed somewhat. I will tread carefully though...

DRP

I would definitely find out whether a buyer would be charged any fees as this will put your place at a disadvantage!

Also what are your time tie-ins etc?