With the relentless march of the internet and tech innovations, gone are the days when there were just a handful of ways to sell a residential property – and sellers paid a chunky fee for the privilege.
These days sellers have a wide variety of choice as to how they sell their property and they can lower their charges significantly by finding a cost-effective option which meets their requirements.
But with so much choice, if you have a property to sell, how do you go about selecting an agent?
A good approach, one which may save you a lot of money, is to consider agents in terms of how much they charge.
1. What is your approach to fees?
As a start, you should decide which of the following three categories you fit into:
- Happy to pay the full fee of a traditional agent providing a full service
- Happy to pay the full fee of an agent providing partial service
- Happy to do the work yourself and reduce the agent’s fee as much as possible.
You will then be in a good position to decide which type of agent to go for – if any.
However, remember that fees will not necessarily be the be all end all. For instance, if you need to sell a property fast, speed may be your paramount consideration and sale via an auction may be your best choice.
Similarly, if you need or want to get the best price for a property, you may need to engage a specific type of agent – even though their charging method is not your preference.
2. Full service selling agents
The traditional full service selling agents are:
- High street estate agents
Sellers traditionally looked for a local estate agent or auctioneer when hiring.
Such agents provide a full service:
- Valuing the property
- Showing it to potential buyers
- Making sure everything gets done before and after exchange of contracts.
For their full service they charge healthy fees, normally a percentage of the price plus VAT.
Estate agents typically charge 1% to 3% of the sale price plus VAT.
Auctioneers also typically charge in the 1% to 3% range, but for the same property their commission is likely to be at the higher end of the range and therefore significantly more expensive.
They may also charge additional fees for advertising and marketing.
Auctioneer’s fees can be high – but if you need to sell fast an auction may be your best alternative.
Increasingly there are online agents offering a full service at competitive rates. Emoov, which claims to be the UK’s biggest online agency, is one such provider.
3. Part service selling agents
If you want some of the benefits of having an agent but are prepared to do some of the work yourself, especially showing buyers around your property, selecting a part service agent may be the way to go.
Such agents operate an array of service models and usually their fees are considerably lower than those of traditional estate agents.
There are an ever increasing number of agents in this space, for instance:
- YOPA – charge a fixed fee with a higher fixed fee if you want the benefit of no sale, no fee.
- Tepilo – fronted up by property icon Sarah Beeny charge a fixed fee with viewings conducted by owners
- Purplebricks – charge a fixed fee but for an additional fee will also conduct viewings.
If you are going to choose a part service agent the crucial thing is to make sure you know exactly how much they will charge and what exactly they will do for you.
It is a question of which mix of services appeal to you. For instance, on their website Purplebricks state (as at 8th October 2018):
“Our one-off fee is payable when you instruct us but you can defer it for up to 10 months when you use our conveyancing service or until your property sells, whichever is sooner. If you don’t sell within 10 months we’ll continue to market your property until it does without asking you for more money”.
One interesting thing about online agencies is that many of them charge a fixed fee payable upfront. Traditional agents typically only charge after a buyer has been found – with the fee payable on completion of the sale.
If you don’t want to pay any fees at all, you should consider instructing an agent able to sell your property using the “modern method of auction” also known as a “conditional auction”.
This is not the same as a traditional auction – a “non-conditional auction”.
The modern method of auction requires a buyer to:
- Pay the agent’s fees
- Exchange contracts within a set timescale (typically 28 days)
- Complete within a set timescale (typically 28 days).
The obvious drawback of the modern method of auction is that many potential buyers will be deterred by having to pay the agent’s commission and the strict timetable – especially if they are buying with the aid of a mortgage.
4. Drawbacks of using part service agents
Some part service agents make it seem like they offer all the benefit of traditional agents but without the price tag.
However it is clear that long-standing traditional agents will usually have a better understanding of the local market than online agents, particularly on the matters of assessing speed of sale and price.
On price, it should be remembered that it is not just a question of putting your property on the market for a high price to your liking. If the price is too high, your property may take longer to sell or may not sell at all – costing you time and perhaps money as a result.
It can be counterproductive to ask for more than what a property is reasonably worth.
You also need to be alert to the fact that online agents may understate the price on account of lack of local knowledge, experience or expertise.
If you do agree to do the viewings, will you be available at all times giving all potential buyers the chance to view and buy your property?
Further will you be comfortable dealing with viewings?
If your time is valuable, you should put a price on it when calculating which type of agent is going to be cheaper for you.
6. Going it alone
If you want to sell without agents, your first task is to get an accurate valuation of your property.
You can do that by paying a surveyor to provide you with a professional valuation.
Alternatively you could decide the valuation yourself – perhaps after obtaining one or two free valuations or appraisals from local agents and conducting your own research using the information and statistics freely available on property portals such as Rightmove and Zoopla.
In relation to the marketing side of things, there are online agencies enabling you to advertise your property through them on the main property portals – thereby gaining a similar level of exposure as when fully signed up with an agent.
In addition or alternatively you could look at one or more of the following approaches:
- Word of mouth advertising
- Putting up a “for sale” sign
- Newspaper/magazine advertising
- Online advertising using sites such as Gumtree and Loot.
7. Drawbacks of going it alone
The most obvious risk of trying to sell without an agent is that it may all end up as a waste of time.
You may not find a buyer at all or a buyer willing to pay your desired price.
You may find it difficult to vet buyers – to weed out the time wasters; to find out who is financially qualified to buy from you, will get a mortgage and is genuinely who they say they are.
Will you be able to deal competently with potential buyers?
Because of your job, training or experience, you may be well-placed to go it alone. If however there is some deficit in the skill sets you will need, going it alone may not be your best alternative.
You can easily save thousands of pounds in commissions if you are able to do without a full traditional service.
However when deciding on the sale method to choose, you need to take into account all relevant factors and make a thorough and informed judgement of the pros and cons of any cheaper option you like the look of.
If you do decide to do everything yourself, be sure to make an honest and realistic assessment of your understanding of the selling process and your ability to carry out, in your best interest, all the steps and procedures involved.
If you want to minimise costs and you are not entirely sure of your own capabilities, perhaps a part service route is the way to go.
Have you ever thought of selling a property yourself? What would be your concerns in doing so? Please leave your comments below.
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Rebel Property Coach
My website is: www.rebelpropertycoach.com