Am I getting my money’s worth?
Estate agency fees can range from below 1% up to 3.5%, depending on the value of the property, and your location. TheAdvisory estimate the average is 1.18%+VAT, but a typical fee could be between 1% to 1.5%, so what exactly are you paying for?
The difference in fees does not usually represent a difference in the service you receive, so it is worth doing your homework before enlisting the help of an estate agent.
We think it’s always important to compare fees on services when you move to get the best deal. That’s not only conveyancing and surveys, but estate agency fees too. Unfortunately, there isn’t a clear comparison of estate agent fees across the UK. We think more transparency would make it easier for sellers to get a better deal.
However, for locations you can take a look at NetanAgent to compare fees.
The estate agent charges usually include the following services.
- Valuation - This involves researching the local market, looking at trends and past sales data. This then need formatting into a comprehensive report
- Floorplans, measurements and photographs
- Write up on your property to entice potential buyers
- The installation of a for sale sign
- The organisation of viewings via telephone and online enquiries
- Cost of viewing
- Marketing the house on the internet
- Newspaper marketing
- Negotiation costs
- Other costs - estate agency office rental, fleet cars and general advertisement
High street prices
As mentioned earlier, estate agents can charge anywhere from below 1% up to 2.5%+VAT. Always ask whether the fee you’re quoted includes VAT or not. If it does not then the price will, of course, go up once VAT is added.
Be sure to work out the percentage on a flat rate fee – it may seem like a great deal, but for properties where the property is priced quite low, the fee may be quite a large percentage.
Let’s do a quick calculation.
According to Land Registry House price report published on 24th March 2021, the average house price in England and Wales (outside of London) stood at £249,309. Using a national average fee of 1%, the agency fee would be £2,493.09. Add on the VAT and the charges stand at £2,991.71.
These prices only reflect high street estate agents, not online options. Often these can be cheaper, or be a fixed fee, but you may end up doing a lot of the work yourself.
What about costs for the buyer?
Traditionally the buyer has a different set of costs to pay for, including Stamp Duty, a surveyor’s fee and legal fees. They do not pay estate agent fees.
Are there ways to avoid these fees?
The cheapest way to sell your home in England and Wales is to use an online estate agency, many of these sites offer a fixed fee package which means you know the cost of using the service from the outset. The services offered by these sites differ, with some companies offering a comprehensive package whilst others simply enabling you to upload a listing. Prices start from as little as £45 up to £600.
It is worth noting that it’s quite normal for the estate agent’s contract to state that agency fees are due on exchange of contracts, meaning that you would be liable for the fees even in circumstances when a buyer did not complete on the house purchase.
Many people don’t realise that estate agent fees are often negotiable, so be sure to ask what deal the estate agent can do for you.
Are estate agent fees different in Scotland?
In Scotland, most solicitors are also estate agents and will act in the marketing process as well as in the legal work when you are selling your home.
In England and Wales, the laws are slightly different and a conveyancer will act separately to an estate agent. You can find out more about conveyancing solicitors in Scotland with our useful guide.
If you think that your estate agent has made any unfair charges, take a look at our article How To Complain About an Estate Agent.
Updated April 2021