“How can you justify your fees?”
This is a common question, normally followed with a gesture of clutching pearls or near fainting when the discussions of how much estate agents charge.
I could go into a long diatribe of paying for local experience and knowledge and all the insurance etc, however, I can hear you, the reader, going “Yeah, yeah. And the Prosecco bill at the local wine bar.”
However, just for a quick reality check for all you readers out there, it’s more than just popping a board up (that costs £50 per board for printing and installation). One of the biggest costs is the advertising, They don’t give Rightmove accounts out for free, Rightmove costs a four figure amount per office, per month, recently there have been reports that this will increase to a bigger four figure amount to £2500 per month!
The overheads of running an office are; staff, rates, rent, utilities, the cars, insurance and the standard office equipment, computers and database management systems aren’t given for free, those photocopied details that are handed out in glorious technicolour cost money.
Yes, you may well see fixed fee deals, where everything is done remotely. Would you trust a medical person to diagnose a problem? someone to prescribe medication over the phone without seeing you, and trust their decision? Have you heard the old adage “You get what you pay for?”
An estate agent is there to do business, a normal local high street agent has minimum of four people working from it, and each office is open 6 days, sometimes 7 days a week to sell or rent your home.
The cost of a basic viewing to an agent is £40 per hour, so when viewers don’t show up it’s equally frustrating for an estate agent as it is a landlord or vendor.
The old adage “Nothing is for free.” Estate Agent’s may have the image that the business suits are fitted for the shark fins, but in reality it’s much more than taking a few nice pictures and opening a door. Getting a deal through to completion involves many people, solicitors, buyers, surveyors and vendors. If you think moving house is stressful, think about the estate agent. It’s the one profession when you see and have to deal with the extremes of emotions, and deal with probably the most expensive investment any individual is buying or selling.
There’s a lot of talk of letting fees being banned, the big question which has gone unanswered is, “Who’s going to pick up the bill?” Yes, perhaps some agency have been somewhere trigger happy with every fee they’ve charged, however the cost of the service that’d given does need to be paid for. Lot’s of discussions have been bandied around about Scotland doing fine without charging fees, however Scotland agents have increased rents steadily since the ban took place there, and Scottish landlords have also been picking up more fees.
Discounting an industry into bargain bucket prices will only go further to diminish the quality and level of service you get. Buy-to-let landlords are common place, most families have a member with more than one property, who have it as an investment or as a pension pot. If you’ve had a bad experience dealing with it yourself, then you know how comforting it is having an agent deal with the trickier parts of property deals. You could get a book on how to refit your bathroom, however how good would it look if you did it, rather than a professional?
Estate agents are in it to make money, but they only get paid the money when a deal has been brokered and completed to a satisfactory conclusion. To have a good agent fighting your corner and getting the most value from your property is a fee worth paying for, isn’t it?