Estate agent fees for withdrawing property from market

NervyBuyer

If you market a property and then decide to take it off the market for whatever reason (before accepting an offer), is it normal to have to pay a fee to the estate agent?

youth_leader

Do you have a copy of your contract - does it refer to it in there? 

eddddy

It depends on what the contract says.

Some estate agents contracts say they charge a fee if you do that - it might be called a "withdrawal fee" or something similar.

You mention "taking it off the market"  - but if you mean "instructing a different estate agent" or "selling privately", there are other issues to consider.




FWIW, I always avoid estate agents who charge a withdrawal fee (or equivalent).

I see a withdrawal fee as potentially a "fee for failure"...
"You tell me that you can sell my property for £x within 8 weeks. But if you fail to do what you say you can do, you want me to pay you a fee anyway?"

user1977

NervyBuyer said:

If you market a property and then decide to take it off the market for whatever reason (before accepting an offer), is it normal to have to pay a fee to the estate agent?

It might be more helpful if you explained why you're asking rather than ask fairly abstract questions - are you already in a contract with an estate agent? (if so, as already said, the answer is in your contract) Or just thinking of selling? Or (given your username) wondering what the relationship might be between a vendor and their agent?

serpico100

Some estate agents charge a withdrawal fee because they have already had advertising and admin costs. Photos have been taken, possible a for sale board has been put up and if you have a high end market house to sell, maybe brochures have been printed. There is also a cost for them to advertise on zoopla and rightmove etc. That can cost around £60 per month

eddddy

serpico100 said:

Some estate agents charge a withdrawal fee because they have already had advertising and admin costs. Photos have been taken, possible a for sale board has been put up and if you have a high end market house to sell, maybe brochures have been printed. There is also a cost for them to advertise on zoopla and rightmove etc. That can cost around £60 per month

Almost all "businesses that sell things" will have advertising and admin costs. For example: Businesses selling cars, businesses selling furniture, businesses selling double glazing, etc

They don't get paid any fees for failing to sell things. (I'm sure that a furniture business would love to be paid fees for not selling furniture - to cover their advertising and admin costs!)


In my experience, lots of estate agents work on a "no sale, no fee" basis - so it's reasonably easy to avoid those that charge withdrawal fees.

I guess it's a bit unfair on the estate agent if the seller changes their mind about selling during the "minimum contract period" - but estate agents understand that risk, and choose to take that risk. It's part of running a business.

NervyBuyer

I meant don't sell it at all, rather than sell through another agent or privately.

I haven't yet marketed the property or approached any agents. I have tried looking for T&Cs on their websites but found none - I assume they vary from case to case depending on how much they want your business.

Sounds as if there is no general approach and agencies will differ.

Thanks for your replies.

eddddy

NervyBuyer said:

I haven't yet marketed the property or approached any agents. I have tried looking for T&Cs on their websites but found none - I assume they vary from case to case depending on how much they want your business.

Sounds as if there is no general approach and agencies will differ.

Thanks for your replies.

Most estate agents don't publish their contracts (t&cs) on their websites - and you're correct that some charge withdrawal fees and others don't.

A good starting point is to look for agents who advertise "no sale, no fee" (but read the contract to make sure).


Presumably, you'll invite a number of estate agents to do "market appraisals". Ask each of them to provide a copy of their contract for you to read. There's a number of things to look out for, including...

• All types of fees and the circumstances when they are payable - these are often negotiable
• Sole agency vs sole selling rights
• "Ready, willing and able buyer" clause - these are best avoided
• Minimum contract period - almost always negotiable
• Withdrawal fees

And as you suggest, don't just consider what will happen if the agent sells the property, consider other outcomes as well, such as:

• You change your mind about selling before you've received/accepted an offer
• You change your mind about selling after you've accepted an offer
• You want to move to another estate agent
• You want to sell to a friend or family member without involving the estate agent

gazfocus

Our estate agent had a clause in the contract that if we withdrew from the market within the ‘sole agency window’ they would charge us a withdrawel fee to cover the costs of advertising/photography/etc. If we withdrew after that period, no withdrawal fee applied, unless they had found a proceedable buyer at the asking price of above by the time we took the house off the market. 

To be honest, I feel that a withdrawal fee is quite fair. Being a business owner myself, it really frustrates me when potential customers expect you to do work for free, why should estate agents be any different? Theoretically, they would have spent money photographing your house (our EA employed a professional photographer), spent money paying staff to do viewings, chase up potential purchasers, printing brochures off, spent money on phone calls even. Our withdrawal fee was something like £300+vat which I think given the above is quite reasonable. 

NervyBuyer

I do agree about thinking you can get away without paying for a service, but on the other hand if you put your trust in the agent advising they can sell it at X price and they can't, because they're all over-egging the valuation and don't have a crystal ball, they haven't really provided the service (so the proceedable buyer + asking price clause is a good one).

Obviously needs careful reading of contracts which I hope will be available at valuation time rather than having to agree to appoint an agent to see it.

serpico100

eddddy said:

serpico100 said:

Some estate agents charge a withdrawal fee because they have already had advertising and admin costs. Photos have been taken, possible a for sale board has been put up and if you have a high end market house to sell, maybe brochures have been printed. There is also a cost for them to advertise on zoopla and rightmove etc. That can cost around £60 per month

Almost all "businesses that sell things" will have advertising and admin costs. For example: Businesses selling cars, businesses selling furniture, businesses selling double glazing, etc

They don't get paid any fees for failing to sell things. (I'm sure that a furniture business would love to be paid fees for not selling furniture - to cover their advertising and admin costs!)

The businesses you mentioned actually own the goods they sell and will keep 100% of the profits on any sale, whereas EA’s are third part sellers working on a commission only basis. You may liken them to auction houses whether it be cars or antiques. They also work on a commission only basis. If you put a ‘lot’ into an auction and subsequently withdraw it from the auction  before the auction house has had a chance to sell it, 99% of the time you will be charged a withdrawal fee