There are few moments in life that are as monumental as selling your home. It’s life-changing and could be the difference between losing money and securing the finances you need to reinvest.
Most property owners use an experienced estate agent to increase their chances of landing a sale quickly. But is hiring an estate agent worth the investment?
The only way to know is to compare the estate agent fees to the listing price of your home and your spending budget. While some people choose to cut corners and embark on the property-selling process themselves, most homeowners would agree, the estate agent fees you pay are well worth the time and stress it saves.
But before you hire an agent and commit to a contract, keep reading. In this guide, you’ll uncover estate agent fees explained so you can make an informed decision about your financial future.
What Are Estate Agent Fees?
As the name suggests, estate agent fees include a list of services and the associated fees that agents charge for helping you market and sell your home or property. These fees vary greatly from one agent to the next based on myriad factors including the location, the agent’s experience, and the price of your property.
The most common services that agents offer, at a price, include
- Property valuation
- Professional photographs or video walkthroughs
- A written description of your property
- For sale sign or sign board for the yard
- Marketing your property on popular portals and within the local community
- Drumming up interest in your listing with current clients and prospective buyers
- Scheduling and hosting viewings
- Negotiating the final sale price
- Completing all the necessary paperwork to finalize the sale
You may also notice estate agent fees include administrative and operating costs like travel time, office hours, fleet cars, etc. These overhead fees are usually listed in fine print, so be sure to read the contract carefully.
The Basics of Estate Agent Fees
Most estate agents offer package pricing that includes most of the above-mentioned services for a single, flat fee while others let sellers choose individual services at a predetermined cost. For example, if you don’t need help marketing or home or conducting viewings, you can simply hire an agent to draw up a floor plan, take photos, and finalize the contract.
Choosing the best package and price depends on your needs, budget, and experience. Some homeowners are comfortable performing certain tasks on their own while others have no issues throwing money at the problem and paying estate agent fees if it means simplifying and expediting the sale.
Here are some ballpark figures to consider when comparing estate agent fees.
- The average estate agent fee in the UK is around 1.18% + VAT fees (a total of 1.42% including VAT fees). These averages are for properties outside the city. Expect to pay more for properties in London.
- Estate agents charging less than 1% may have something to hide. This is an extremely low percentage and as the old saying goes, if it sounds too good to be true, it probably is.
- Whenever possible, choose the option for “no sale, no fee”. Most agents sell about 50% of the properties they list, which isn’t great odds.
- Don’t be afraid to negotiate. Most estate agent fees aren’t set in stone.
- Keep an eye out for hidden costs and charges like those mentioned above. Not all agents list every single service and may try to charge you additional fees at the end.
- Consider the difference between an online letting agent, a high-street agent, and hybrid agents which offer both online and in-person services.
Fully-Managed Services vs. Individual Estate Agent Fees
When an estate agent charges a flat fee for fully-managed services, they handle every aspect of your sale from start to finish. These same estate agents often offer individual services at a price. Let’s take a more detailed look at what estate agents charge and how much you can expect to pay for some of the most popular services.
Listings on Property Portals
With 99% of homebuyers between the ages of 23 and 56 using the Internet to conduct property searches, if your home isn’t listed online, chances are, it won’t sell. But simply posting your house for sale on your own Facebook page won’t do the trick. Your listing needs to appear on some of the most popular property portals like Zoopla and Rightmove if you’re going to gain any traction or interest.
Most estate agents have an established account on these property portals and know how to craft an attention-grabbing listing. They can manage any inquiries, answer buyers’ questions, update the listing, and schedule viewings all from their personal dashboard. All you need to do is sit back and wait for the phone to ring!
Some agents also offer premium listings on these sites as a bonus for signing up. This means your property will show up higher on the results page and more frequently than other listings. According to Zoopla, premium listings receive 70% more page views and twice as many inquiries as standard listings.
Scheduled Viewings and Open Houses
Once you get a hit on your listing and someone is interested enough to plan a viewing, your estate agent will coordinate all the details. These include scheduling a day and time, meeting the prospective buyers at the property, and conducting the walkthrough. While some homeowners ask to be present during viewings, it’s often frowned upon. Not only do some people feel uncomfortable watching strangers walk through their homes, but the potential buyers don’t feel comfortable asking questions or making minor (or major) criticisms.
It’s best to leave viewings up to the professionals. Your estate agent will know how to handle tough questions, put a positive spin on potential issues or imperfections, and highlight all of your property’s best features.
Open houses are another great way to get people into your home. Although they say a picture is worth a thousand words, there’s nothing quite like seeing your next potential home in person. Estate agents organize, schedule, and host open houses where they are on-site and available to handle any inquiries or walk-ins. According to one study, open houses usually generate one or two offers, so be sure to ask the estate agent you hire if they offer this service and for how much.
Professional Photos and Floorplans
While open houses and in-person viewings are great, not all buyers can feasibly visit your property. Investors and overseas buyers will make a decision based on the photos they see online. This is why your listing needs professional, high-quality photos that show all your home’s best features. Many estate agents work closely with professional photographers to create gorgeous, high-quality images that showcase your property in the best light (literally). Photographs know which angles work best, how to set the scene, and the right lighting and filters to use. While these photos come at a cost, it’s a small price to pay for a beautiful listing that brings in multiple offers.
Adding a floor plan to your listing is another benefit and another service that estate agents offer. Prospective buyers want to see the exact layout of the home, the size of the rooms, and where they are positioned. A detailed floor plan gives buyers a bird’s eye view of the interior of your property without ever stepping foot in it. Not all listings require a floor plan, though, so don’t feel obligated to pay estate agent fees for this service.
Surveying and Conveyancing
Long before you list your property for sale, you need a survey to determine the exact property lines. Professional surveys will do this for you and present you with a legal certificate for you to provide to interested buyers. Most estate agents offer these services as part of their fees, whether they do the survey themselves or hire an independent contractor licensed in the field.
You’ll also need a conveyancer to help finalize all of the paperwork and contracts to guarantee that the final sale is legal. They also transfer the property to the new owners. Most estate agents have a reliable conveyancer that they work closely with. This saves you the trouble of finding and hiring your own. Just know that many estate agents get a kickback for referring you (the seller) to the conveyancer, so don’t be afraid to negotiate this fee.
Sellers using the money from the sale of their home to purchase their next property may need mortgage advice as well. Similar to working with surveyors and conveyancers, many estate agents know reliable mortgage lenders and companies they can refer you to. Estate agents themselves can’t and shouldn’t offer financial advice, however, they can give you some insight into current mortgage rates. At that point, they can also steer you toward a mortgage broker who can provide more information and help you secure funding.
But this comes at a cost. Some agents roll this referral fee into their initial price for putting you in contact with a reputable lender. In some cases, the lender themselves will offer the agent a kickback for the referral, canceling out your fees. Ask the estate agent if they’re receiving a kickback and how much. You may be able to negotiate this figure off the total estate agent fees you pay.
Slightly different from listing and selling your home with an estate agent, some agents also offer letting services for those looking to rent their property. Perhaps you’re not ready to sell just yet or you’re interested in becoming a landlord – an estate agent can help.
Some estate agents double as letting agents and can offer valuable advice on how much your property is worth, how much you could make each month, plus management services to help simplify the process.
The agent may also advise you on whether it makes more sense to sell your property or let it. Some homeowners save the rent they collect from letting their property and use it toward their next purchase. Ask the agent if they charge a fixed fee or offer individual services for letting and see which approach makes more sense for your budget and financial goals.
Find Affordable Estate Agent Fees for Your Next Home Sale
Selling your property is a big decision. You probably have questions about how much to list it for, where to advertise, and how to secure the funds you need for your next purchase. An estate agent can help you make all of these major life decisions and more.
With experience and industry knowledge, estate agents have the skill set to sell your property for top dollar and fast. If you’re considering sidestepping estate agent fees by selling your property yourself, you may want to reconsider. Although you’ll have to pay for these services upfront, the time and stress you save will be well worth it in the end when you’re unlocking the door to your new home.