By Paul Lewis,
Most people find their next home using one of the online websites like RightMove, Zoopla, or PrimeLocation. But only estate agents are allowed to put homes on those websites as part of their stranglehold over property sales.
There is, however, a choice over the type of agent you use – a traditional high-street agent, or one of the new breed of online agents. The difference in price is huge. Typically, a high-street agent charges a percentage of the price your home is sold for. The national average charge is 1.4%, so the fee to sell a typical home is around
£4,000. Add VAT and you get closer to £5,000. Fees are more in parts of the UK where homes are more expensive. And many agents charge much more than 1.4% – or try to!
Online agents like PurpleBricks, eMoov, and Yopa charge a flat fee whatever the price of your home. They tend to cost in the high hundreds of pounds (more in London). But there is one big difference. The high-street agent only sends the bill once the house is sold. If it doesn’t sell you don’t pay.
By contrast, the online agent’s fee will be due whether or not you sell your home. They like to take the fee up front, though will offer to defer payment by some months. If you do that you will actually be borrowing the money from a loan company. No interest is charged, but if your home has not sold when the deal ends and you cannot pay the fee then the loan company will pass that information to credit reference agencies and may take tough action to collect it.
With all agents there may be extras to pay for, including an Energy Performance Certificate, photography, floorplans, advertising or accompanied visits. Always check carefully what the fees include. With an online agent
you will normally have to set the selling price and may have to describe the property yourself, especially with the cheaper ones.
A high-street agent should use their local knowledge and database of home seekers to find potential buyers. They will also suggest an asking price and advertise in newspapers. Only you can judge if the higher cost is worthwhile. If you think it is, then negotiate to get it down – to 1% or less if you can.