Estate Agent: Fixed fee or percentage of selling price?

Fleabag

I have a house to sell, but am going to get it rewired and redecorated throughout first to hopefully maximise viewings and chance of selling close to my asking price. The house is a former council house. A few in the street are now also privately owned, but mine is in a terrace of others all still managed by a housing association (I did approach the HA to ask if they might want to return it to HA stock, in which case I'd have not done any work and lowered my price accordingly, but they weren't interested).

The fee vs % of selling price is, perhaps, an easier decision when selling a house worth a few hundred thousand, but properties of the same type in the area are selling for £65k-£110k, depending on the amount of work that has (or hasn't) been done. Realistically, I believe that mine might be worth around £85k with a certificated new rewire and fresh, neutral decor, as the more expensive properties have knocked through and/or extended the kitchen/dining rooms (the kitchens are VERY small in these properties) and have fairly high-end finishes in the kitchens/bathrooms (I intend to only replace kitchen cupboard doors to make it look clean and fresh, in the knowledge that a new buyer may rip it out anyway to remodel the kitchen/dining space). However, considering the current market, I might be underestimating its value, and it might be possible to place it on the market at a higher price - perhaps up to £95K-£100k.

Fixed fee agents charge £900, with an extra £300 to manage viewings (I now live 20 miles away from the house, so including this would be more practical for me). Traditional % contracts would charge in the region of 1.5%, which would be £1200 if it sold for £80k, but could run to £1500 if it sold for nearer £100k. These contracts appear to include managing viewings.

So if the house sells for the bottom end of what it seems to be worth, I'd be paying about the same whichever type of agent contract I choose (or even less with a % contract if it sells for under £80). If it sells for more than £80k, I'd spend more on a % based contract.

However, I can't help feeling that paying a % of the selling price is a much greater motivation to not only sell, but to push for the best price they can.

As an additional complication, if I could complete by the end of November, I'd save £3000 stamp duty (my 3 years expire then), but I know that it's highly unlikely I'll achieve this, with work still to be done before it even goes on the market (and dropping the price to get a virtually instant sale would likely defeat the object, as it would probably cost me more than the £3k I'd be trying to claw back).

What are people's thoughts on the Fixed-fee vs Percentage fee issue?

Finchy2018

is the fixed fee company an online only one? normally a traditional agent would carry out viewings as standard. I wonder what else the fixed fee doesn't cover? and is payable regardless of sale?

AdrianC

I'd be very surprised if rewiring and redecorating a property at that end of the market will return the cost of the work - especially if you're going to be paying to have professionals do the work.

Given that you're looking at pretty much the same agent cost for both scenarios, it's a no-brainer to me. Local agent.

[Deleted User]

From The Property Ombudsman section on conflict of interest

If you are selling a property that is owned by you, an employee
or an associate (or an associate of an employee) or in which
you, an employee (or an associate of an employee) has an
interest, you must by law, before negotiations begin,
immediately make this known, in writing.

Fleabag

Finchy2018 wrote: »

is the fixed fee company an online only one? normally a traditional agent would carry out viewings as standard. I wonder what else the fixed fee doesn't cover? and is payable regardless of sale?

I'm comparing it to the cost of Purple Bricks, which charges £899 fixed (upfront or later, but seems to be payable whether it sells or not). They add £300 if carrying out the viewings

highguyuk

You can get local (Traditional) estate agents to around the £900+VAT fee if you try hard enough.

In fact, all our local estate agents quoted us a fixed fee amount - not one suggested a percentage commission.

Fleabag

AdrianC wrote: »

I'd be very surprised if rewiring and redecorating a property at that end of the market will return the cost of the work - especially if you're going to be paying to have professionals do the work.

Given that you're looking at pretty much the same agent cost for both scenarios, it's a no-brainer to me. Local agent.

yes, local agent seems to be the way to go.

Regarding the work, having done a little research this afternoon, I have started to wonder whether it might not be worth it - the plan had been to pay for the rewire (and possibly the plastering afterwards) and doing most, if not all, of the decorating ourselves (with up to 8 of us on the job). Possibly getting a professional in just to strip & repaint the hall, stairs & landing.

I'm thinking now that I might get away with getting the electrics checked and upgrading anything that needs it (including the old fusebox). The house has always killed lightbulbs with alarming frequency, along with 3 fridges in 14 years (though we didn't have fuses blow with undue regularity), so I felt that perhaps the electrics were a bit ropey.

What complicates it a bit is that I'm quite determined that the house should be freshly painted & looking as good as it can, cosmetically, as tired decorations will dramatically downgrade the value and its ability to draw in viewers & my chances of a quick sale. I'm really worried that, if a survey suggested the need fora rewire, potential buyers would not only want the cost of the rewire deducted from the selling price, but also the cost of full, professional redecoration that would be needed as a result.

Fleabag

Deleted_User wrote: »

From The Property Ombudsman section on conflict of interest

If you are selling a property that is owned by you, an employee
or an associate (or an associate of an employee) or in which
you, an employee (or an associate of an employee) has an
interest, you must by law, before negotiations begin,
immediately make this known, in writing.

I'm sorry, I don't understand what this has to do with my query. There's no conflict of interest. I don't work for an estate agent (if that's what this quote is alluding to)

AdrianC

Fleabag wrote: »

I'm sorry, I don't understand what this has to do with my query. There's no conflict of interest. I don't work for an estate agent (if that's what this quote is alluding to)

I think he meant to post in this thread...
https://forums.moneysavingexpert.com/discussion/6048765/conflict-of-interest

Fleabag

AdrianC wrote: »

I think he meant to post in this thread...
https://forums.moneysavingexpert.com/discussion/6048765/conflict-of-interest

that explains it! I was rather confused!

Finchy2018

As you are not local to the property the thing to think about with a pb local property expert is their definition of local can be quite some distance. They will get paid regardless so why go the extra mile to do a viewing? A traditional high street agent will not get paid unless they sell, it's in their interest to sell. Not to mention several staff members to carry out said viewings not potentially a one man band.