Am I getting my money’s worth?
Estate agency fees range from 1.5% to 4% so what exactly are you paying for?
Interestingly the difference in fees does not usually represent a difference in the service you re-ceive, so it is worth doing your homework before enlisting the help of an estate agent. Take a look at Getagent 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 between 1.5% to 4%. There is also an additional 20% to be added for VAT.
So let’s do a quick calculation. According to the Land Registry House price report published on 28th July 2015, the average house price in England and Wales (outside of London) stood at £181,619. Using a national average fee of 1.8%, the agency fee would be £3,269.14. Add on the VAT and the charges stand at £3,922.97. That’s before the cost of legal fees. Ouch!
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. However in some markets, particularly London, estate agents are making the most of a buzzing property market.
Use our moving cost calculator to work out how much it will cost for you to move house
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 differs, with some companies offering a comprehensive package whilst others simply enable 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.
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 February 2017