High street agent’s profits soar – No Relenting on Estate Agent fees
Profits for Connells estate agency group increased 22% last year – with management stating that the chain is almost certainly the most profitable in the UK estate agency industry.
Connells are not the only major corporate chain to release press statements recently declaring a huge boost in their trading income and bottom line profits. LSL Property Services, who purchased Halifax Estate Agency and whom are better known for their Your Move and Reeds Rains brands, also announced striking profit figures to the press.
So what is the typical high street London estate agent charging you for?
- Advertising on the property portals
- Sending a member of staff to take some (usually pretty dire) photographs
- A few placements in the often ineffective local press
- Handling incoming calls
- Attending viewings with potential buyers
- Negotiating the ‘best offer’
- Administrating the sale once a buyer is found
- Fancy offices
- Lots of staff
- Company phones
- Too many Mini’s / Beetles / cars in general
Ok we made the last few up, but you get the picture.
Here’s some other useful statistics: (Source: The Academy Survey)
- Rightmove is by far the biggest property website in the UK and is used regularly by 84% of homebuyers.
- Property Websites are used regularly by 89% of homebuyers.
- Only 6% of homebuyers repeatedly use Estate Agents windows to look for a property.
- Only 14% of homebuyers repeatedly use papers to look for a property.
- London estate agents charge an average of 1.8% of the sale price (Source: OFT)
- Average London property sales price is currently £430,680 (Source: Rightmove)
This means the average London estate agent fee is over £9300 with the VAT included! Based on the charges made on a typical London sale, the fee seems a tad expensive.
What London estate agents certainly don’t tell you is about the two factors that will ensure that enough people want to see your property that will almost certainly lead to the offer you want:
Price: Get the initial asking price right. Even Miles Shipside from Rightmove attests to the need to get your marketing price correct initially to ensure your property attracts potential buyers. There are also statistics bounding around currently that suggest that the difference in the average marketing price of property nationally and the average sale price of property is as high as 24%. Quite a few over-price properties in other words. Finding out what other properties have sold for is pretty easy using the internet, and sites like Zoopla can really help. Surely an agent wouldn’t value your property higher than it’s really worth just to tempt you into instructing their services? Remember, even if you secured an offer, overpriced properties are generally valued lower by RICS surveyors acting for the buyers mortgage lender.
Marketing: It cannot be stated enough that quality marketing gets buyers interested. Consider that potential buyers are looking on a screen to decide whether your property appeals enough to want to see it in the flesh. Don’t accept images that look as if the agent was falling over at the time the photograph was taken.
Fishneedwater is one of the new breed of internet estate agents. Fees are up to 90% less for a better service, less the viewings which the seller takes care of (with guidance of course as to what elements of your property to mention). The lowest fee is just £795 plus VAT.
The better parts of the online estate agent service:
- The property is value by a RICS surveyor – the very same type of surveyor that will be sent by your eventual buyers Mortgage lender. This ensures that the marketing price is initially accurate
- All marketing is handled by an experienced property photographer – the type that also does glossy magazine shoots. You property will look a Million Dollars (even if it’s not quite worth that amount).
- Floor-plans as standard
- Video Marketing as standard
- NAEA accredited – straight talking sensible advice, always
- Former High Street Agents – We know the industry, and we’re confident about our claims