What To Look For In An Estate Agent
The agent works for you
When you are selling a property it is imperative that you find the best agent for your individual needs. Most agents work on commission and this can put you in a strong position, because it means that if they don't sell, then they don't get paid. However, it can be a double edged sword, as they may prioritise properties with a bigger fee.
As, in most cases, the agents need the "numbers," you may feel pressure to sign up there and then. DON'T.
Make sure you have taken the time to think before putting your signature on the dotted line.
Sole or Multi?
How many agents should you sign up with? Is there any benefit to more than one?
Well, that is entirely up to you. On the one hand, gaining shop window and online presence can be a helping hand! However, on the other hand, it can make you look desperate to sell. It will also, almost certainly cost you more. Most agents will charge higher fees to go with multiple agents.
Create a shortlist of 3 possible estate agents
Draw up a list of possible agents (no more than 3) and invite them around to value your property. Remember, it is not just for them to value, it is also for you to get to know them. Selling a house can be a lengthy process, can you see a positive relationship with the agent for the months that follow. Do you trust them? Do you like them?
Ask people for a recommendation
Other people will have good and bad experiences. Do your research. And listen to others. But be aware, if they tell you that Colin did a fantastic job for them, but Sharon comes to your door, you may get a different service from the same agency.
Get The Facts
Local estate agents will always tell you how successful they are. They will tell you how many potential buyers they have, how many properties they have and how quickly they will sell your house.
All estate agents will tell you the same things about their own agency.
Separate the truth from the untruths.
Firstly, buyers tend to register with every agency. So most agents will have similar lists of applicants. Although there will be agents that may be a little more "in the know" than others, the lists are very similar.
Secondly, having many properties is not necessarily a medal of honour. A hundred properties still on the market and very little "sold boards" is not a great sign. However, it does prove that other sellers trust them too.
Lastly, how quickly an agent sells your home is based on the same things - condition, location and price. If all three of these are correct, any agent will sell as quickly as another.
So, compare local estate agents based on the facts: how quickly they actually sell property, how close they come to achieving the original asking price and how successful they are.
Look at the properties that the agent is selling on Rightmove.
Are the pictures of good quality and well taken?
Are the descriptions clear and relevant?
Do they use video tours?
Are the video tours well shot and edited?
Then check what they offer inclusive in their fee.
What is their viewing policy?
Will they accompany viewings?
Will you have to do the viewings yourself?
Will accompanied viewings cost you extra?
Are their photography/video packages free?
When the estate agents are sat with you, in your home it is a good opportunity to ask questions.
Are they accredited to a redress scheme such as The Property Ombudsman?
Do the agents work weekends or will you be limited to weekdays only?
What is their reason for giving the value that they have?
What are their standard terms and conditions?
What is their contract length?
How long have they themselves worked in estate agency?
How quickly will the house go on to the market?
Think about the value of the valuation
Agents are well aware that one of the main reasons for being chosen to market property, is based on the value that they give.
That is why there are two general approaches.
1) Deliberate over value.
Make you believe that they can sell your property at a higher price, then gradually knock the price down with reductions until the price is correct.
By locking you into long contracts, you have little choice but to accept the advice.
2) Realistic Approach
After you say, "I've had higher valuations" they tell you not to be fooled by the false high values.
Either way, the agent should arrive with evidence. Print outs of houses they have sold in the local area, print outs of other property sold by other agents, to support their valuation. A good agent will advise you that it is you who chooses the price of the property, based on your timescale of how quickly you want to move.
You can do your own research too, by looking at Zoopla or Rightmove you can get a gauge of the properties value, before the agent even arrives.
How much do estate agents cost?
Times they are a'changing...
Up until very recently, estate agents only charged a percentage of the sale value.
This can be anywhere between 0.75% and a whopping 3%! All plus VAT of course.
But now there is an alternative.
Thanks to online agents, many high street agents are opting to join the "fixed fee brigade".
If you opt for a percentage based agent, you should try to negotiate down to no more than 1% + VAT for a sole agency agreement. The competition is harsh in this fee bracket, so use that to your advantage.
In this case, a property sold for £250,000 will cost you £2500 plus VAT (currently 20%), so make sure you have calculated prior to accepting an offer.
Fixed Fee agents will charge one fixed fee + VAT on any property value. Which can often save you thousands.
You may be able to get your chosen shortlist agents to compete on cost prior to agreeing a contract, just make sure you understand the terms and conditions, in case hidden costs raise their heads later down the line.
When you select an estate agent, you will be asked to sign a contract. This contract legally binds you to them for the duration, so there are things to be aware of.
Will you have to pay extra for special "marketing packs"?
Will you have to pay for a For Sale Board?
Will you have to pay for property details?
Try to negotiate a fee that includes EVERYTHING.
You are entitled to choose the best mortgage advice, surveyors and solicitors. Do not be fooled by the "you have to use our solicitor, you must use our mortgage advisor" statements. These are simply not true. They are targets set by estate agent managers to get the best referral return, and they are simply under hand tactics for the agent to make more money. Many of the larger firms use panel solicitors or financial advisors, all of which belong to or pay back to the company themselves.
If an agent suggests to you that it would be quicker to use their own in house conveyancers (not necessarily solicitors - know the difference) ask them why. If they tell you that you must sit with their financial advisors to qualify you, ask them why. Why is a mortgage in principal from another advisor worth less than one from their own?
More importantly, don't get stuck in a contract that takes away your choice. Some agents will have it written in their terms that you must use their teams or face higher fees.
What happens if you find your own buyer? Do you still have to pay the agent?
In most cases this will be the case, so make sure you have mentioned any interested parties before hand, and if necessary have them excluded from the contract.
Do you only pay commission if they sell the property? Or is there a "ready, willing and able purchaser" clause in the terms? The latter would mean that you would still be liable to pay the fee if you were forced to pull out of the sale - even if you lose your job or become unwell.
Ensure your agent only expects paying the full balance on exchange of contracts or completion.
Does the agreement have a time limit? You do not want to be stuck in a long contract if you become unhappy with the agent. A normal period would be around 12 weeks, but some are as little as 4, and some as long as 20!
Don't be fooled. If an agent has told you that they can sell your house in two weeks, why are they then asking for twenty weeks to prove it?
Also be aware of the two week cooling off period. That is your escape route if you change your mind about the agent. Ensure that the property is marketed straight away, so that you have that time to evaluate the agency. Do NOT be trapped by the property going on the market after the cooling off period has passed. This means that whether you like it or not, you are stuck for the long haul.
Be aware of longer contracts from online agents. Some as long as ten months!
So what about the online estate agents?
As discussed earlier, the online estate agents are much cheaper than conventional high street estate agents. But you pay this cheaper a fixed fee upfront and they vary in terms of what packages and prices they offer.
Fees for online estate agents vary, but can start as little as a £300 flat rate fee paid upfront, but in most cases there are other costs involved, so read the terms carefully.
Wait... Can I sell my home myself?
Yep. You absolutely DO NOT have to hire an estate agent.
This is now even easier than ever before, with websites allowing you to very easily list your own property. However, it is worth noting that only estate agencies with the correct legal requirements can market your property on the online portals like Rightmove.
This makes exposure to potential buyers very limited.
If you can find a buyer yourself you can indeed save money. However, if you sell your house for the wrong price, the money you saved could be totally erased by your error.
An estate agent will also be able to qualify your buyers for you to ensure that they have the funds to make an offer and complete the purchase, chase the sale progression with solicitors and keep long property chains in tact. Saving a lot of time, heartbreak and money in the long run.
Find an agent that offers what matters to you.
This is the biggest acquisition that you have, and it should be treated as such.
Trust, honesty, communication are the same key features that you would look for in a friend.
Your agent will be the first point of contact for your potential buyers, so they need to represent YOU as well as your property.