What is an estate agent?
Estate agents are a curious mixture of sales, marketing, administration and counsellors. Used right, an estate agent can maximise the selling value of your home by marketing it to the widest possible audience. Once buyers have started to enquire about the property, agents switch over to their sales skills to make sure any enquiries are handled and negotiations are conducted to the benefit of the owner. If an offer is agreed, the agent becomes an administrator and shepherds the transaction through to legal completion. Counselling generally comes in useful when things don’t go as planned.
Types of estate agent
There are three main types of estate agent – corporate, independent and internet based.
Corporate – in terms of numbers, most of the UK’s estate agents are part of national chains with multiple branches across the country. Many of these chains are owned by several large corporations or financial institutions – it is a little publicised fact that several agents in a town can be owned by the same company but trade under different names.
Widespread brand recognition, lots of outlets, but high staff turnover and a tendency to heavily target employees to sell mortgages and extra services.
Independent – owner/operators, often running one branch or a small network of branches.
Usually local people who have worked in estate agency for many years. A more personal hands-on approach with time to concentrate on the vendor, their needs and obtaining the best price from the best buyer.
Internet based – little or no High St presence, often charging fees up front and invariably expecting owners to do much of the traditional agent’s work.
Considerably cheaper than most estate agents but they do much less marketing – you pay for what you get.
Do I need to use an estate agent?
No – you can sell your home privately and attract buyers by using some of the techniques an agent would use (for example – newspaper advertising, for sale board). If you have time, you can organise and conduct viewings, negotiate with your buyer and deal with solicitors. However, you won’t be able to use the largest property websites to advertise your home, newspaper advertising will cost considerably more and you will have to devote a lot of your own time to the sale. Research from buyers indicates that the majority would prefer not to deal with owners direct.
The story of selling a property
Before you choose which agents to value your home, check what properties they have for sale and those they’ve sold. Do they deal in your market or area? Have they sold similar homes to yours? How do they present their properties from a buyer’s perspective? Market research like this will help you identify the most suitable agents to invite to your home and will also give you some idea of the value of your property. When you’ve decided on the agents to invite out, dig a little deeper by examining reviews about them (check their website, but also look elsewhere for independent customer feedback – www.allagents.co.uk is a good place to start). You could also call or visit agents to see how you’re dealt with.
ALWAYS OBTAIN THREE VALUATIONS – you need to get a spread of opinion – but it is also an opportunity to judge which agent suits you best. Before each visit, think about what type of services you would like from an agent and any extras they might offer. During the valuation, don’t show your hand and tell the agent what you think your home is worth or what other agents’ opinions have been. If you have any particular requests (for example, accompanied viewings on a weekend or after-hours communication), ask if they can accommodate you.
Choosing an agent – the common misconceptions
Typically, people rely on two main criteria when choosing an estate agent – they’ll pick the agent which;
a) charges the lowest commission rate or
b) gives the highest valuation.
You should never choose an agent based on either of these.
The old adage is still true – you pay for what you get. A low fee may mean poor service or little marketing effort. If the valuation is wrong you either have to wait for the market to rise, or reduce your asking price after weeks of wasted marketing.
Do you want one agent (sole agency), two (joint agency) or many agents (multiple agency) to sell your home? Fees will differ between the three options, but one agent generally costs much less than two or more. A good agent won’t need anyone else to help sell the property and having your home advertised with more than one agent often leads buyers to suspect something is wrong with it. Sole agency fees vary from agent to agent but should be in the region of 1.5% + VAT. Always negotiate with the agent, but bear in mind that corporate agents / national chains will have imposed minimum fee levels on their employees, so you’re likelier to get more flexibility on fees from independent agents.