How Much are Estate Agent Fees?
So, how much are estate agent fees? Truthfully, the amount you’ll pay varies widely, and often depends on the final sale price of the property itself. Let’s talk about the ins and outs, how to save money, negotiations, and more.
What are estate agent fees?
First things first, let’s define what we’re talking about. Traditional high street estate agents charge for key services that help you sell your home. These fees include:
- Marketing your property
- Enticing description
- Drumming up interest
- Professional photographs
- Floorplans and measurements
- Asking price valuations
- Managed viewings (as well as the organisation of them)
- Negotiating the sale price
- Installing a ‘for sale’ sign
- Helping during the conveyancing process to move the sale from exchange to completion
How much are estate agent fees?
So, how much does an estate agent charge? While contract terms and fees vary, estate agents usually charge a percentage fee (usually between 0.75% and 3.5%+VAT of the agreed sale price).
Many work on a ‘no sale, no fee’ basis, which can help you avoid wasted costs if your home doesn’t sell.
The current average estate agent fee is 1.18%+VAT, however this does vary, and can be more expensive depending on location. London, for example, tends to have higher fees. Aim to get a fee around 1%.
Who pays estate agent costs?
Buyers do not pay estate agent fees – only the seller. Buyers have other costs to contend with, such as stamp duty.
What to watch out for
The cost of moving house adds up, so it’s easy to see why many try to save money where they can. However, there are some red flags you should be on the lookout for.
Less than 1%
Estate agents with fees below 1% might offer a less ‘hands on’ service and will likely be a reason they’re so cheap. The cost of selling your house can be higher than anticipated, but cutting corners could lead to problems later down the line.
Vague fees
Agents are required by the Property Ombudsman to state their fee in an actual amount in their contract. Ensure this is the case.
But,
Hidden costs
Beware of ‘hidden costs’; all key services should be included in the estate agent’s contract. Agents are required (by law) to inform you of what’s included in their fee, but you should always ask – don’t assume. This quote should be inclusive of VAT, but not everyone plays by the rules – so double check.
Watch out for things like additional upfront fees, for example for registration or up-front marketing.
Pressure tactics
Estate agents are working for you, but remember it’s in their interest to secure as high a final house price as possible. This isn’t a conflict of interest necessarily, but something to be aware of.
You may need to secure an energy performance certificate (EPC) before you sell your property, if you don’t have one dated within 10 years. Some estate agents will have in-house or close relationships with providers who can arrange one on your behalf – but you’re not obliged to do so. This also applies to solicitor or mortgage adviser recommendations, for example. Don’t feel pressured – the choice is yours on who you use.
How to save money
There are some ways you can reduce or avoid paying estate agent fees – but they’re not without their own risks. Consider each option carefully to ensure it’s right for you.
Online estate agents
Many choose an online estate agent in an effort to keep costs down. They tend to charge on a fixed fee or flat rate basis, rather than a percentage.
While these certainly have their perks, they’re not for everyone. For example, they may not have the in-depth local knowledge high-street agents do that you can tap into. Always do your research and be cautious of rogue estate agents!
Selling privately
You could avoid estate agent fees altogether by selling your home privately. This can be a good option if you already have an interested buyer, such as a friend. If not, bear in mind this will be time-consuming and potentially more difficult than anticipated.
How to negotiate estate agent fees
Decided to go the traditional route? There are ways to save money when it comes to your house sale. Tip: you should always negotiate!
Invite multiple agents to your home, say around three, and collect quotes. Estate agents will want your business, so if you say you’ve found a cheaper deal, they may reduce their fee.
Most agents are prepared to be flexible, so don’t be shy!
Sliding scale
Another haggling tactic is to ask agents to agree to a sliding scale of commission. This can further incentivise them to sell the property for the best possible price possible. Essentially, you pay different rates of commission based on the price they secure for your home.
For example, let’s say you think your home is worth £400,000. If they sell it below £375,000 = 1% fee. Then, let’s say they sell it for over £425,000 = 1.75% fee.
Are things different in Scotland?
In England and Wales, conveyancers and estate agents act separately. However, in Scotland, estate agents take on the process of marketing the property, as well as the legal work involved with selling.
Both aspects of selling a home are essential. A conveyancer will take on everything from dealing with paperwork to liaising with the buyer’s solicitor, while an estate agent will ensure your home sells in a timely manner – and for a good price. This is why it’s key to choose wisely; the agent will impact how long it takes your house to sell and what you get for it.
Need to find an expert solicitor? We can connect you with a professional, all who work on a ‘no sale, no fee’ basis. Get a conveyancing quote for free below.
Top tips
When choosing an estate agent, there are some things to be aware of:
Pick carefully
One of the best selling tips is to choose an agent with a track record of selling your type of property in your area. Estate agents are the ones with their ear to the ground, and have local knowledge you can tap into. This will be invaluable!
Do your own valuation
It’s a good idea to get your own idea of how much your home is worth. While agents will do a valuation, some have been known to inflate this in a bid to secure your business.
So, it’s recommended you get an understanding of your property’s value before going any further. You can use online valuation tools, but you should also look at how much similar properties have sold for in your area. The more clued up you are, the better.
Ask the right questions
It’s not all about money; you want to ensure you’re getting the best service possible. So, make sure you do some digging.
Some questions to ask, and find the answers to, include:
- How will they advertise and promote your property?
Do they need proof of funds? - Who will be your point of contact and do they have the right experience?
- Do they have a hot buyers list i.e a list of serious buyers that might be interested in your home now?
- What is the initial term of the contract?
- How easy is it to get out of the contract? How long is the notice period? (For example if you’re unhappy with the service you’re getting)
- What happens if you find a buyer yourself?
- Is it a fixed fee charge? (This is often the case with cheaper properties)
Want an alternative option?
If you’re looking for a cheaper, more affordable way to sell, the Modern Method of Auction might be for you. It offers flexible timescales and more security, as buyers are committed. Want to find out more? Get your online property auction started below.
Last Updated: November 21st, 2024
