House Selling - Money Saving Tips

DavidP_3

Estate agents have very little incentive to achieve the best price for your house. Say you are selling a £200,000 house and the agent gets 2%, i.e. he'll get £4000 if he gets the asking price. If an offer comes in for £180,000 he'll be pushing you to accept it - he won't mind dropping £400 to get it off his books, no more work, no more advertising. You, on the other hand, lose £19,600.
Try to get a deal where you pay a much higher rate of commission on what he gets above a certain amount. In this case try for 10% on everything he gets above £160,000. If he gets the asking price (as he suggested he would!) he still gets his £4000. However, he won't be so ready to push you into accepting £180,000 as he would only collect £2000.
He also has the incentive to get more. Find a buyer at £220,000 and you have to pay him £6000 - which doesn't hurt as much when you realise that you end up with £18,000 more than you expected.
Some agents will accept this sort of deal. I've tried it twice - the first time I got the asking price and the second time we failed to find a buyer!

David.

eglons

Disclaimer: I was involved in writing the site for https://www.housenetwork.co.uk so am a bit biased!

Disclaimer 2: I posted this in another thread but the top of the thread got deleted so I'm not sure it could be found?

Fact: Online home sales are the way the market is going, 60% of sales in the US are conducted this way (many without the services of a realtor (estate agent) at all) and it's a growing industry in the UK, and I'd, therefore recommend that anyone selling a house, at least, considers the online route.

There are essentially 3 ways to sell your home these days:

- Traditional Agent, they give you the personal touch and should be able to offer local knowledge and a waiting client list. They will also handle all of the viewings and buyer negotiations for you. They will normally have some relationship with the major portals (Rightmove, Look4AProperty, PropertyFinder, Fish4 etc) but tend to be quite bland in their use of the internet. No upfront fees but sale fees of 1-2% which can be a killer on a 6 figure sale.
- Online Agent, essentially a Tradional Agent but with no local office (House Network fits into this category), again you get the personal touch, an agent visits your home and takes the particulars, which are then whisked to the web creating your own online Property site (with full services like Virtual Tours and digital floorplans). These agents have property upload networks which tend to be all encompassing and the quality of the listing and comprehensive imagery and digital add ons really give them the edge. They also cover the handiling of booking viewings, chasing feedback and handling the sales chain (although you will need to be available for the viewings). You miss out on local knowledge, have to set your own price, and pay an upfront fee (£199 in the case of House Network) but the benefit is a professional web based marketing campaign (Housenetwork had well over a million viewers last year) and a very small sales fee when they sell your property (£199 max again for HN).
- Private Sales, this breaks into 2 areas, using a private sales web service or DIY (which really means that you do the whole thing yourself). The Private Sales web services are springing up all over the web, and whilst the pricing mirrors the online agent there tends to be a lot lower upfront fee and usually no fee on completion. Usually there is no visit by the private sales company, instead they give you a web interface to list your own property and tools to help get it listed on the major portals (although Rightmove specifically exclude private sellers as they are not members of the National Association of Estate Agents - NAEA - and hence are not bound by it's professional code of conduct and things like the property misdescriptions act). Usually there is no fee on completion so these services really are rock bottom pricing, but conversely they act only as a people broker, so you have to manage your own viewings and sales process.

Which have just done a report on selling your home online and Housenetwork were recommended in section 2 along with https://www.halfapercent.com (I've no links with this one!).

I wonder whether Martin might be tempted to delve into this world and give a less biased (although I've tried my best!) view on how you can get best bang for your buck in an increasingly complex marketplace.

cockshooters

We have just put our house on the market. The estate agents' deal is 1.75% (they are pretty desperate for properties to sell in this area - good for us!) but this includes all the selling conveyancing fees through their associated solicitor. My quick calculation is that the actual percentage our estate agent will get will be fractionally below 1%, and the solicitors should get about the average fee. Well we like it and will let you know how it pans out.

On the subject of Stamp Duty, previously mentioned by another poster, one negotiating tactic would be to offer to reduce the price by the amount of Duty. If you have added a bit to your ideal asking price in the first place then there should be no problem as the price therefore effectively remains the same. The actual problem is that if people are only looking for properties below £250,000 (the current 3% threshold) and you are priced at £280,000, then they will not even consider your property. That said, it might weed out the less serious viewings and offers but it may make the property more difficult to shift. It rather depends on how quickly you want to move.

Regards

Cockshooters

Nenen

This is a brilliant thread which I am gaining so much from! Thank you all so much. :beer: :grouphug:

I wonder if Marcus (or anyone else with knowledge of selling houses) might give us the benefit of his advice… sorry if this is long-winded but I’m trying to be accurate and just feel so naïve and easily taken in by estate agents, all of whom told me they were totally trustworthy, sounded sooooooo plausible while they were here etc etc etc but now I just don’t know what to believe!

We live in a very small town (think large village) in Suffolk which is seen as ‘desirable’ as it has historic connections and many twee period properties (although our house is a 3 bed 1970s semi in need of a bit of ‘updating’ inside and out, quite rare here). It is structurally sound (as far as we know) and has a new kitchen and fairly new bathroom (although the cream suite is apparently unpopular and should be white, a tip for anyone installing a new bathroom) but needs redecorating throughout, new carpets/flooring, new windows/doors and repairs to the rendering which is cracked. I told all the EAs to be honest with me about what would need to be done in order to optimise our chances of getting a good sale. However, we are very limited in the amount of available cash and time we have to spend! :sad:

I did as Marcus suggested and got in 3 estate agents for valuations today. There are two estate agents in the town whom I suspect ‘peg’ their commission, as both told us independently when they came for valuations today that they charged 1.85% but as a special ‘favour’ to us they would drop to 1.75%. The first EA valued our property at £185,000 but I think that one look at our shocked and despondent faces (we had expected in excess of £200,000) told him we were not happy with this and he gradually ‘talked himself up’ finally suggesting (with no explicit suggestions from us but I’m sure he read our body language) that we put it on for 2 weeks at £199,995 and see what interest we got. He said that to get that amount we would have to get the outside rendering repaired and some other fairly expensive repairs etc. My OH was convinced that he deliberately undervalued in order to get a quick sale (as someone on this thread posted recently the difference in commission between these prices is relatively little). This agent valued our next door neighbour’s house (completely different to ours as a tiny two bed period cottage) a few weeks ago and after our neighbour insisted that he put it on his books at £10,000 more than his initial valuation of £170,000, they got £180,000 within 4 days!!!

The 2nd EA valued our property at £175,000 (until she found out later that the other one had valued at more than this when she swiftly upped her suggested guide price to between £185-190,000) and again said we’d need to get some of the work done first to achieve this price.

Of course both the EAs in our town told us all sorts of reasons why they were best, specialist local knowledge, etc. One advertises online with Primelocation (said Rightmove wasn’t classy enough) and the other with Rightmove (said Primelocation wasn’t right for properties under half million)! :wall:

The 3rd EA came from a bigger town a few miles away (who haven’t currently got any properties in our town on their books (but told me they have had in the past) was thrilled by the location, views etc and immediately said we shouldn’t do any of the work on it as we’d probably only get a return of about 8 tenths of what we spent anyway and that it would be a good property to market for someone who wants a ‘project’ (like the man who she said had been in their office only that morning looking for a property between £200-225,00 that needed a bit of time and money spent on it)! She tried very hard to get me to tell her what we wanted for it and when I avoided the question (thanks to Marcus) she cleverly got me to tell her that we wanted to move to Cambridge (about 25 miles away and a notoriously expensive city compared to here) and in retrospect I’m sure she worked out that we would need to get a high price for our house in order to begin to afford to live in Cambridge! Surprise, surprise she then valued it at £225,000! Her commission is 1.25% which she assured me could be negotiated down if we had to take a cut in the asking price! She said we could have any tie in we liked, none at all if we wanted although she recommended 12 weeks! She seemed too good to be true compared to the others and I must admit we are tempted to go with her but wonder:

1) Given that there are quite a few things that need doing to the house to get it to ‘immaculate’ and quite honestly we couldn’t possibly afford to do them all, is she right about doing nothing and marketing it as ‘in need of some modernisation’ to interest those keen on doing up a property etc?
2) How much of a negative thing is it to ‘test the market’ by putting it on at a high price and then dropping substantially after a couple of weeks if no interest is shown?
3) Would it lessen our chances of selling at all to put it on with the third EA (cheapest commission best price) for 2-4 weeks and then if she doesn’t sell to change agents?
4) How important is ‘specialist local knowledge’ and use of Rightmove or Primelocation?

If you've read all this... many thanks! All answers gratefully received and Happy Easter to you all!!! :EasterBun

danidp

I signed up with a local estate agent at a fixed fee of £2,350 inc VAT, which represented less than 1% of the value of my house. Great deal - or so I thought! The agent had no incentive to get the best possible price for my house as he would get his £2,350 regardless. So he put loads of pressure on me to accept low offers even though he and I knew that my house was worth more. Once I had finally accepted an offer, he then proceeded to lie to and manipulate both myself and the buyer for 4 months until I had had enough, so I backed out of the sale and took my house off the market. Since then, whilst still under contract with the same agent*, I have sold my house privately by advertising on houseladder.co.uk. It cost me £119 to advertise and I accepted an offer at the asking price within a week of advertising. I sold my house for £267,500 which was £12,500 more than with the agent - plus I saved £2,350 on agents fees too!

*The contract was for a sole agency agreement, but that doesn't stop you selling your house privately through advertising on the web. I was locked into the contract for 16 weeks which I thought wasn't too bad, but I then discovered on reading the small print that the 16 week period started on the date of signature and was SUSPENDED when solictiors were instructed on a sale. The 16 weeks would only resume if a sale fell through. So when my sale fell through after 4 months, I thought I was free of the agent, but in fact I was only 10 days into the 16 weeks. Read the small print.

All estate agents will tell you that you can't possibly sell a property without them. They are liars! Granted, if your property is unusual or not in great condition or might be difficult to sell for whatever reason, then maybe an estate agent might be a good bet. BUT even if you sign up with an agent, you can still continue to advertise it yourself. Don't be taken in by their lies. If you've got a digital camera and some savvy - advertise it yourself. Look at the agents details for other houses in your area and get an idea of what to put on your advert.

This is now the second time I've sold a property without an agent. It can be done! :beer:

aniram

Marcus wrote:

Greetings all. I’ve been using this site for a while now and have managed to save us a small fortune. Years ago I was an estate agent so I thought I’d see is I could write some bits and bobs in relation to my experiences in the hope that it might save people some cash.

Selling Your House

Methods to Save Money

1) Agents Fees
a. All Estate Agent Fees are negotiable. First, check through the local property paper. See which agents get the most business. Are any members of the NAEA. Busy agents who are members of the NAEA would be my first choices. Select the best 3 or 4 agents and phone them up as potential buyers. See what service you get over a week or so as a buyer - that way you’ll get an idea of how they will market and present your property. A good proactive, busy and well managed agent will still have time and resources to post/email you details and phone you with new properties.

Then get them all to Value your property. Tell each valuer that you have other valuations (BUT NEVER TELL THEM WHAT VALUATIONS OTHER AGENTS HAVE GIVEN YOU - AS THEY’LL MANIPULATE THEIR OWN VALUATIONS) and that you are looking for a fee of 1% with no lock-ins. Most agents will try to lock you in - so that if you instruct them to take your property off the market you will not contractually be able to re-market with another agent for up to 8 weeks (especially with corporates). Make sure you get this down to 1 week after written notice. If you are locked in and you then sell your property through another agent you will get sued for the fees.

Agents are sales persons - they will give you great reasons to lock you in and charge you more... but they also need your business - thus you have the power to ask for and get these things.

b. Once your property is up for sale keep an eye on your agent - mystery shop them ie call them up, give a false name etc. and tell them you are looking for a property that matches your own property’s description - see if they push for you to view your property - are they positive and energetic?

The Duel/Multi-Agency myth.
If you become unhappy with your agent’s efforts it may be time to sack them or go multi agency. Tell an agent that you wish more than one agent to market your property and they’ll try and push up the fees to staggering amounts (2.5%+!!).
Tactics - tell your current agent that you wish for other agents to market your property. Tell them that you’ll keep them as an agent only if they will keep your fees at 1%. If they will not, then sack them (you should only be locked in for a week). I’ve never known an agent not to back down in this situation - they’d lose potential business if they let you go.
Now go to some other agents - probably the other agents on your original list - and tell them that “my agent has agreed to let me go multi-agency and my current fees are 1% - would you like to also market my property at 1% multi-agency?” You can guess what the answer will be...

A 1 % saving on the average cost of a property in the UK (currently £150000) will save you £1500 before VAT.

Duel Agency means you’re marketing with 2 agents - multi agency means you’re with more than two. Agents will try and charge you more for either of these - especially in the case of multi.



2) Solicitor Fees
During you initial enquiries with estate agents, ask them for several recommendations each of good conveyancers or solicitors. You don’t just want the name of the firm, but also the name of the specific solicitor/conveyancer. Remember, some agents will have ‘arrangements’ with some solicitors and some will even have their own - so be warned. A good rule of thumb would be to approach solicitors (by name) who have been recommended by different agents - although some solicitors will have arrangements with more than one agent.

Phone the best solicitors and ask for written confirmation of their charges. Take note of how they treat you - do they speak in plain English, are they friendly and do you get their details as promised the next day. And once again - their fees are negotiable - there’s no reason not to ask your favourite contender to shave £xxx off of their fees if you have evidence of more competitive quotes from other solicitors... they may say “no chance” - in which case you need to make a decision as to whether or not the extra charges are really worth it.

A solicitor can make or break deals for you so shop around. It’s very hard to change solicitors once they start the conveyancing process for you... and it will cost you!

And finally - avoid fee busting corporate conveyancing firms - they will most likely slow down the conveyancing process - these are normally call centre and internet based firms. They can save you as much as £500... but as stingy as I am I would never use them.



I hope this is of use to you and I hope that my info is still correct.
I’ll see if I can write something for buyers when dealing with agents and the like.

Regards
Marcus

Hi..
Very helpfull...
Would 1% fee still apply for estate agents? I'm in the process of finding an Estate agent, the one I had round would not come lower than 1.25%..

aniram

Hi...
Very helpfull.. :T
I'm in the early process of selling my house. Would 1% still apply now for Estate agent fees? Because the one I had round to value my property would not go lower that 1.25%.. I did try :rolleyes:

:wave:

aniram

Jorgan_2

Aniram, it all depends on what the market is doing in your area at the moment. When this thread was started, the market in many areas was moving quickly, agents could reduce fees as they had less advertising costs etc to pay out. In many areas the market has tighened up, things are taking longer to sell, more expenditure for agents so reluctance to reduce fees. This may be why you can't get the agents down on fees.

cheapskate101

One trick estate agents use is to say that they have a 'lovely young couple' on their books - looking for a home just like yours.

You sign up, they come round - and a lovely couple they are - and go away again. Of course they do..... they've been employed by estate agent to do just that.

Be careful of this ruse because any estate agent using it may not exactly have your best interests at heart.

ps it might be a lovely older couple etc nowdays.

kitaj

Can anyone explain to me why I shouldn't do my own conveyancing? I have just spent a year in court in a family proceedings issue against a barrister and a solicitor. I was LIP for that time and managed to handle all the case myself. It was a bit hairy sometimes and the barrister was clearly experienced in getting his own way but it wasn't beyond my ability to deal with most things.
Conveyancing doesn't involve going into court (hopefully:rolleyes: ). I would only do the conveyancing on the sale, not the buying so it would be up to my buyers' solicitors to check the documentation and, provided I was completely honest, answered all questions and enclosed the necessary documents surely there wouldn't be too many hassles - would there?

I do take the point that professionals are there for a reason, but as has so rightly been pointed out, most of the work is done by clerks anyway. We are very poor and anxious to save any money that we can (we got offers on the house without an agent) Any comments would be gratefully received!