According to recent surveys by Home Moving Trends, estate agent fees are now falling by between 0.1% and 0.15% every year.
Interestingly, another survey revealed that 86% of respondents didn’t choose the estate agent offering the lowest fees.
As regular visitors to our website will know, we love to research the prices being charged by businesses and tradespeople for home improvement projects in the UK.
We’ve recently taken time out to research the cost of moving home in 2018. Our guide covers stamp duty, survey costs, mortgage setup, legal fees and more.
On this page, we’ll take a look at how much estate agents are charging in our area – the Surrey and Hampshire borders.
How Much Do You Think an Estate Agent Will Charge?
One of the most popular features of our site is our polls and questionnaires – we love asking our readers how much they think certain projects or services will cost.
Can you answer the question below?
How much do you think an estate agent will charge to sell an average priced home?
The Home Moving Trends Survey
The 2017 Home Moving Trends Survey revealed that the average estate agent fee in the UK is now 1% +VAT.
But this data covers the whole of the UK.
It also includes prices from traditional, internet-based and hybrid estate agents.
We decided to conduct our own small-scale research, so keep reading to see how much we think the average estate agent fees are for our area.
Our Research Into Estate Agent Fees
In March and early April 2018, we asked 36 estate agents based in Surrey and Hampshire how much they would charge to sell a house valued at £226,000 – the current national average.
Some of the agents we contacted were internet-based firms but most were traditional bricks-and-mortar agents that you’re probably familiar with.
Most of the internet-based firms offered us a fixed fee rather than a percentage, so we’ve calculated how much this would be as a percentage of a £226,000 sale.
We’ve included VAT in the prices:
|Agent:||Average Cost (based on a sale price of £226,000)|
|Traditional Agent:||1.50% inc VAT|
|Internet-Based Agent:||0.42% inc VAT|
|Hybrid Agent:||0.65% inc VAT|
Don’t Forget to Haggle
The prices we sourced from estate agents were their standard prices.
We didn’t arrange a face-to-face meeting with any of the businesses so didn’t have the opportunity to haggle for a cheaper price.
A Small Increase in Percentage Fees Can Cost Thousands
The table below reveals the difference between a 1.2% and a 2.4% commission rate.
As you can see, the difference is thousands of pounds in most cases:
|Sale Price:||1.2% inc VAT||2.4% inc VAT|
London and the South East Verses Everywhere Else
Our price guide is based on estate agent prices for areas along the Hampshire and Surrey border.
This area of the south-east is close to London and several of the internet-based firms we contacted charged more for this region than elsewhere in the UK.
While we don’t know the exact prices charged by traditional estate agents outside of London and the south-east, we assume they will be either the same or cheaper than this area.
Because We Don’t Like Comparing Apples to Oranges…
Not all estate agents are created equal and the services offered vary from firm to firm.
With that in mind, we only considered estate agent fees that are inclusive of floorplans, photography and listings on the major property search websites.
Most of the internet-based estate agents didn’t include assisted viewings in their standard prices. The average cost for this additional service was £350.
Assisted viewings were included in all the prices given to us by traditional estate agents.
No-Sale-No-Fee or Fixed Fee?
Traditional estate agents usually offer a no-sale-no-fee agreement. Internet-based firms typically charge a fixed, albeit lower fee, regardless of whether the property sells or not.
But which option is best for you?
Out of every 10 homes that an estate agent puts up for sale, up to 7 won’t sell.
But the estate agent still incurs costs for those properties; listings on property search websites, floorplans, professional photography, assisted visits, advice and much more.
A no-win-no-fee agreement protects you should you decide to pull out of the sale. However, if a sale does go through, you’re essentially paying extra to cover the costs incurred by the estate agent for all those homes they didn’t sell.
That’s one of the key reasons why traditional estate agents charge more than internet-based firms.
But if you’re considering an internet-based firm offering a fixed fee, do remember that if they can’t sell your home, you’ll probably want to try another estate agent – that means paying twice.
Also, consider that local traditional estate agents typically offer a more “hands-on” service. They know the area well, can better filter out timewasters and arguably, can get you higher value bids on your property.
What is a Hybrid Estate Agent?
Online estate agents are often criticised for their lack of one-to-one contact with many using call centres to deal with enquiries.
Traditional estate agents are often seen by sellers as too expensive. Many homes sell quickly with little more than an advert on Rightmove or Zoopla.
Hybrid estate agents attempt to offer the benefits of an internet-based business with local knowledge, a single point of contact and fixed fees.
Hybrid agencies typically cost more than internet-based firms but less than traditional agents. The quality of the service is also typically mid-ranged.
How Much Should You Pay an Estate Agent to Sell Your Home?
The key point to remember is this:
There’s little point in saving £1000 off your estate agency fees if you end up selling your house for £5000 less than you could have received had you chosen a better agency.
It’s also worth pointing out that a commission based estate agent has an incentive to maximise the sale price – the higher the price the more they earn.
There is no incentive for a fixed fee agent to push for a higher price. The sooner the sale is finalised, the sooner they get paid, regardless of the final sale price.
We think homeowners just outside of London should shortlist estate agents based on feedback from friends and family and then haggle on price.
1.5% inc VAT is the average estate agency, based on our research covering the Surrey/Hants border areas.
If you found our guide to estate agent charges and fees insightful, explore our home movers cost guide here. We’ve got everything covered; from mortgage and conveyancing fees to survey and removal firm prices.