Estate Agent Fees - What Is A Target Percentage Based On?

TojoRalph

GDB2222 said:

I would gladly pay extra for a professional photographer, and I’d expect to pay that up front, regardless of whether the property sells. Maybe £100-200. Otherwise, the estate agent will take some snaps, which won’t work as well. 

Likewise, I’d expect to pay for a home information pack, etc.

If the EA's images were in anyway better than the other 20 or so EA's listings then I would understand they were perhaps doing something different and had to pay a photographer upfront, but the standard of photography is no better or worse than any other EA. That said, the upfront marketing and photography fee is a total of £650, with the photography element being only £120 and thus a small part.

In Scotland its a Home Report, the fees for which will be paid by myself directly to the surveyor and which are not included in any of the quoted fees.

eddddy

user1977 said:

TojoRalph said:

user1977 said:

TojoRalph said:

user1977 said:

Does their quote actually say it's "2.3% of the £65k" or is that just your calculation? If the latter than I presume they've quoted a fixed price.

Normally the 1% or whatever people are talking about is the whole fee (perhaps with modest add-ons for photos etc, and often excluding VAT), but at the lower price levels there's obviously going to be a minimum fee they'd be prepared to charge.

I would get some other quotes anyway before you start thinking too deeply about this one.

in a brief list of caveats below, it references the quote being based on a normal transaction requiring a normal amount of work with additional fees applicable if more complex. I take that to be not fixed and potentially wide open to abuse?

Not "wide open", no. Do you have any reason to suspect your sale will be unusually complex? You'd get plenty of warning if it turns out to be anyway.

I have no reason to assume the transaction would not be straightforward and normal, it's just that with normal being such a vague description in a quote and my dealing with service related contract issues in my employment, it kind of jumps out and strikes me as being open to the application of additional costs.

You can expect to see a similar caveat to your solicitor's quote too - though I'm not sure what circumstances would involve an unusual amount of the estate agent's time. Perhaps a succession of sales falling through or something.

I've read through dozens and dozens of estate agent's contracts (in England), and I've never seen a clause saying they might charge extra for "complex" work.


I've also discussed this type of issue with a few estate agents.

One EA described their fee structure as "speculative" - they charge everyone the same percentage fee, but..

• Sometimes a property sells on the first viewing and the conveyancing sails through with no problem
• Sometimes a property takes months to sell and/or the sales progression is very painful and time consuming
• Sometimes a property doesn't sell at all - so they got no payment for all their work and outgoings

And typically a leasehold flat selling for £250k will need much more sales progression than a freehold house selling for £1m+. (Because of all the issues that arise with leasehold properties) But they earn 4 times the fee for the freehold house.



And is the agent saying that the contract ceases to be 'No sale, no fee', if they have to do 'complex' work? So if a sale falls through and the seller terminates the contract and moves to another agent, the seller has to pay for any "complex" work done?

TojoRalph

eddddy said:

user1977 said:

TojoRalph said:

user1977 said:

TojoRalph said:

user1977 said:

Does their quote actually say it's "2.3% of the £65k" or is that just your calculation? If the latter than I presume they've quoted a fixed price.

Normally the 1% or whatever people are talking about is the whole fee (perhaps with modest add-ons for photos etc, and often excluding VAT), but at the lower price levels there's obviously going to be a minimum fee they'd be prepared to charge.

I would get some other quotes anyway before you start thinking too deeply about this one.

in a brief list of caveats below, it references the quote being based on a normal transaction requiring a normal amount of work with additional fees applicable if more complex. I take that to be not fixed and potentially wide open to abuse?

Not "wide open", no. Do you have any reason to suspect your sale will be unusually complex? You'd get plenty of warning if it turns out to be anyway.

I have no reason to assume the transaction would not be straightforward and normal, it's just that with normal being such a vague description in a quote and my dealing with service related contract issues in my employment, it kind of jumps out and strikes me as being open to the application of additional costs.

You can expect to see a similar caveat to your solicitor's quote too - though I'm not sure what circumstances would involve an unusual amount of the estate agent's time. Perhaps a succession of sales falling through or something.

I've read through dozens and dozens of estate agent's contracts (in England), and I've never seen a clause saying they might charge extra for "complex" work.

I've also discussed this type of issue with a few estate agents.

One EA described their fee structure as "speculative" - they charge everyone the same percentage fee, but..

• Sometimes a property sells on the first viewing and the conveyancing sails through with no problem
• Sometimes a property takes months to sell and/or the sales progression is very painful and time consuming
• Sometimes a property doesn't sell at all - so they got no payment for all their work and outgoings

And typically a leasehold flat selling for £250k will need much more sales progression than a freehold house selling for £1m+. (Because of all the issues that arise with leasehold properties) But they earn 4 times the fee for the freehold house.

And is the agent saying that the contract ceases to be 'No sale, no fee', if they have to do 'complex' work? So if a sale falls through and the seller terminates the contract and moves to another agent, the seller has to pay for any "complex" work done?

Your leasehold v freehold makes sense and for the record the flat is freehold. Not sure we have a lot of leasehold in Scotland. From a contractual "No sale, No fee" perspective, I mentioned earlier that the sales agreement, letter of instruction and terms of business have not been supplied and are are described as "to be issued upon instruction". So apart from one page of costs and three pages of advertising blurb, there are no terms and conditions or otherwise.

Funnily enough, the email ends by saying, "Hopefully all is in order and if so, please let me know and I will go ahead and get your photos and home report organised", and all without any contract, terms or conditions supplied, agreed or signed. The reference to the Home Report assumes that I am willing to use their RICS surveyor and pay £450 for a Home Report. I have been quoted £290 for for a Home Report by a RICS surveyor also on the lenders register. That said, I am aware that £450 is typically very much the local price for properties under £100K, regardless of size. 

TojoRalph

Following on, as suggested, I have engaged other EA's to provide a quote based on the same ball park selling price. In addition I have a couple of EA's coming out to view, value and quote so I can at least have some dialogue. As a result I have received a quote from one EA. Having checked the services are pretty much a like for like comparison based on limited detail, the second quote total Estate Agency selling fees are £1,510 which is compared against the initial EA quote of £2,210. This quote also requires an upfront fee of £500. Again, this is not fixed but an estimate.

However again there are only a few notes, no terms and conditions, no proposed contract terms, no reference to selling rights, be they sole agent, sole selling or otherwise, if there is a tie in period, Etc. There is however one note that if I cancel my instructions to them to sell, work has commenced on my behalf, but a sale not achieved, they reserve the right to issue a fee for work done to that point which is estimated to be £500, plus VAT, plus outlays incurred such as viewings which are again charged individually.
 
So with no T's &C's I queried the quote basis and was advised they work on sole agency basis. I then queried the costs if I chose to take the property off the market at any point in the future as to me it read that if I were to engage them and took the property off the market at any point in time, I would be contractually obliged to pay £600 plus extras (on top of the £500) to buy my way out of any contract. They confirmed this was the case and my understanding was correct.

A point to note that I had not grasped to date is that in Scotland, properties are traditionally sold by Solicitors, albeit to all intense and purposes their websites and High Street windows look like any traditional UK Estate Agents. In addition, over the years Solicitors in Scotland have collaborated to create Solicitors Property Centres which are used for marketing purposes. Its fair to say a very high percentage of Solicitors have signed up to these SPC's and before the internet was so widely accessible, they were welcome by buyers as they brought the majority of property in a given area under one roof and they would be listed altogether in one weekly printed publication. Today however, if the Solicitor (EA) you choose is part of an SPC, they will only list the property on/in/with their own website and an SPC website and the property cannot be listed on any other online agency such as Zoopla, Rightmove, Etc. Advertising in an SPC accounts for £360 of the upfront fees.

Every day is a school day and it is clear I am going to have to be clear on my expectations with regards to any requotes.

user1977

TojoRalph said:

A point to note that I had not grasped to date is that in Scotland, properties are traditionally sold by Solicitors, albeit to all intense and purposes their websites and High Street windows look like any traditional UK Estate Agents. In addition, over the years Solicitors in Scotland have collaborated to create Solicitors Property Centres which are used for marketing purposes. Its fair to say a very high percentage of Solicitors have signed up to these SPC's and before the internet was so widely accessible, they were welcome by buyers as they brought the majority of property in a given area under one roof and they would be listed altogether in one weekly printed publication. Today however, if the Solicitor (EA) you choose is part of an SPC, they will only list the property on/in/with their own website and an SPC website and the property cannot be listed on any other online agency such as Zoopla, Rightmove, Etc.

Depends where you are in the country - around Glasgow the "separate" estate agents have always had a high proportion of the market and it's more of a sideline for solicitors.

TojoRalph

user1977 said:

TojoRalph said:

A point to note that I had not grasped to date is that in Scotland, properties are traditionally sold by Solicitors, albeit to all intense and purposes their websites and High Street windows look like any traditional UK Estate Agents. In addition, over the years Solicitors in Scotland have collaborated to create Solicitors Property Centres which are used for marketing purposes. Its fair to say a very high percentage of Solicitors have signed up to these SPC's and before the internet was so widely accessible, they were welcome by buyers as they brought the majority of property in a given area under one roof and they would be listed altogether in one weekly printed publication. Today however, if the Solicitor (EA) you choose is part of an SPC, they will only list the property on/in/with their own website and an SPC website and the property cannot be listed on any other online agency such as Zoopla, Rightmove, Etc.

Depends where you are in the country - around Glasgow the "separate" estate agents have always had a high proportion of the market and it's more of a sideline for solicitors.

That's interesting and having done a little more research, I see that the Glasgow Solicitors Property Centre went into liquidation in 2018 as the alliance crumbled. 

I am guessing both Solicitors and Estate Agents in Glasgow are now either tied to ESPC or utilise the Zooplas, Rightmove a, Etc. of the world?

user1977

TojoRalph said:

user1977 said:

TojoRalph said:

A point to note that I had not grasped to date is that in Scotland, properties are traditionally sold by Solicitors, albeit to all intense and purposes their websites and High Street windows look like any traditional UK Estate Agents. In addition, over the years Solicitors in Scotland have collaborated to create Solicitors Property Centres which are used for marketing purposes. Its fair to say a very high percentage of Solicitors have signed up to these SPC's and before the internet was so widely accessible, they were welcome by buyers as they brought the majority of property in a given area under one roof and they would be listed altogether in one weekly printed publication. Today however, if the Solicitor (EA) you choose is part of an SPC, they will only list the property on/in/with their own website and an SPC website and the property cannot be listed on any other online agency such as Zoopla, Rightmove, Etc.

Depends where you are in the country - around Glasgow the "separate" estate agents have always had a high proportion of the market and it's more of a sideline for solicitors.

That's interesting and having done a little more research, I see that the Glasgow Solicitors Property Centre went into liquidation in 2018 as the alliance crumbled. 

I am guessing both Solicitors and Estate Agents in Glasgow are now either tied to ESPC or utilise the Zooplas, Rightmove a, Etc. of the world?

Yes.

Out of interest, is there a reason why all of this seems new to you? Didn't you buy the property originally, and/or are you new to Scotland? If you're thinking of selling, it would make sense to see how the "competition" are marketing themselves.

sheramber

Edinburgh solicitors do advertise on Rightmove and  ESPC.

TojoRalph

user1977 said:

TojoRalph said:

user1977 said:

TojoRalph said:

A point to note that I had not grasped to date is that in Scotland, properties are traditionally sold by Solicitors, albeit to all intense and purposes their websites and High Street windows look like any traditional UK Estate Agents. In addition, over the years Solicitors in Scotland have collaborated to create Solicitors Property Centres which are used for marketing purposes. Its fair to say a very high percentage of Solicitors have signed up to these SPC's and before the internet was so widely accessible, they were welcome by buyers as they brought the majority of property in a given area under one roof and they would be listed altogether in one weekly printed publication. Today however, if the Solicitor (EA) you choose is part of an SPC, they will only list the property on/in/with their own website and an SPC website and the property cannot be listed on any other online agency such as Zoopla, Rightmove, Etc.

Depends where you are in the country - around Glasgow the "separate" estate agents have always had a high proportion of the market and it's more of a sideline for solicitors.

That's interesting and having done a little more research, I see that the Glasgow Solicitors Property Centre went into liquidation in 2018 as the alliance crumbled. 

I am guessing both Solicitors and Estate Agents in Glasgow are now either tied to ESPC or utilise the Zooplas, Rightmove a, Etc. of the world?

Yes.

Out of interest, is there a reason why all of this seems new to you? Didn't you buy the property originally, and/or are you new to Scotland? If you're thinking of selling, it would make sense to see how the "competition" are marketing themselves.

I haven't sold a property or engaged with an EA in over 23 years, hence I am a little rusty. That is also why I read the various guides and having got some quotes, I have started to appreciate that the the do's and don'ts may not be overly relevant to Scotland.

TojoRalph

sheramber said:

Edinburgh solicitors do advertise on Rightmove and  ESPC.

That is very interesting as the ASPC is very different, as I found out today when discussing with an EA where they typically list a property. If an ASPC solicitor/EA uses ASPC, they cannot then utilize any other online agency eg Zoopla, Rightmove, Etc. to list the property. Thanks.