Guide to estate agents
Estate agents: what they do and tips for finding the best one for your property needs
Estate Agents provide a service for people looking to sell a home and for people who are looking to buy a home. They are generally the first port of call for anybody who needs property information, but what does an Estate Agent actually offer?
Services Estate Agents Provide for Sellers
When a person decides that they want to sell their home, the first thing they need to find out is how much their house is worth, so that they will be able to know what price to put their house on the market for. Many people invite a number of Estate Agents to come and look around their home and give them an estimated asking price.
It should be remembered however, that the Estate Agent does NOT value your property; they simply use their experience of selling similar properties in the area, to give you a rough estimate of your homes’ worth. Estate Agents are not qualified to give valuations and their estimates are not accepted by insurance agencies or any other company looking for legally binding information regarding a property’s value. However, Estate Agents are useful for giving a guiding price of how much they think the property is worth and their service at this point is free, as they welcome the opportunity to sell their services.
It is recommended that you get a minimum of three Estate Agents views on how much they think you should put down as an asking price. This is because Estate Agent’s estimates can differ hugely depending on their own interests and the fact that it is a ‘gut-feeling’ rather than a science upon which they base their view of the asking price. Hence, getting a range of estimates will help you to gain a better idea of how much you should decide to put your house on the market for.
You have to be wary at the price an Estate Agent estimates your house to be worth as if he comes up with a low asking price he could be what’s known as a ‘cash king.’ This is when an Estate Agent wants to sell your house quickly so that they can get their commission faster; hence they want to put your property on the market for an attractively low price. Whereas, on the other-hand, if an Estate Agent’s estimate seems too high, they could be just trying to get you to give them business, as they know that once you have signed a contract with them, they can lower the asking price of the property if they are not receiving any offers. If you want to get a proper qualified property valuation then this will set you back several hundred pounds in fees to a qualified surveyor, hence many people do not choose this option at this stage.
There are three different methods of employing an Estate Agent to sell your house. There is the sole agency method, where you employ only one agency to sell your property. That agency takes full responsibility for the sale and receives all the commission that you have agreed to pay on the completion of the sale. The second method is joint agency, this is when you employ two or more agents to sell your property and they share the commission, regardless of which agency makes the sale. The third method of using Estate Agents to sell your property is to use the multiple agency method. This is an arrangement where you sell through more than one agent, but you instruct them independently. This means that which ever agent makes the sale, receives the commission and the other agent get nothing But make sure that you check and understand all the terms and conditions for each contract or agreement before you sign.
Once you have signed a contract with an Estate Agent they become responsible for advertising your property to prospective clients so that you can receive offers and successfully sell your property. It is important therefore that you read through thoroughly the contract that they offer you, as this will include what services they are offering you, your rights, their rights and most importantly their rate of commission. Commission rates can vary dramatically between Estate Agents and generally fall anywhere between 1.5% and 4% of the price your house sells for. However, remember that on top of this you also have to add on VAT which at the present time stands at 17.5%. Therefore make sure you know exactly what type of service your Estate Agent is offering you for their commission.
After the contract is signed an Estate Agent will begin to advertise your property to prospective clients. The advertising an Estate Agent does includes, photographing your property and producing publicity material. To do this they will come to visit your property again so that they can write a property description. The property description should comprise of the asking price, the general location of the property, a description of each room including its measurements, a description of the garden (if applicable), any special features your property has, as well as a brief summary of its location and the local amenities.
They will then use the information they have gathered about your property to advertise in their shop window, to access passing trade. It will also be included in their sales portfolio, which they show prospective clients and it my be included in mail-outs, press advertisements or even press releases about the company. They will place their ‘for sale’ board in front of your property, hence they are advertising your property and you are advertising their business. This is an important point to remember when choosing an Estate Agent; you must make sure that they have a good reputation amongst the community so that people will want to purchase your property through them.
The next major part of the service Estate Agents’ offer is organizing prospective buyers to come and view your property. The common practice is that the Estate Agent will show the prospective buyers around your property, as they have the sales ability to sell it and answer questions the buyer may have about the process of buying the property. You have the option of being at the viewing. Some people prefer to be at the viewing, as it allows them to answer specific questions about the property and it also allows them to form an opinion of the buyer, which helps when making decisions about what offers to accept and decline. Some people also prefer to be at the viewing so that they can oversee what goes on, preventing the prospective buyer from rummaging through their personal belongings. However, on the other-hand some buyers feel uncomfortable when the seller is present and prefer to view a property with only the Estate Agent. Therefore it is up to the Seller to decide whether they attend the viewing or not.
If you decide not to attend viewings, then it is common practice to leave a spare set of keys with the Estate Agent. It is important therefore, that you trust your Estate Agent and that you find out the security measures they have in place for holding keys. Whatever you deicide, the Estate Agent will have to let you know when they are arranging a viewing. This is so they know that they are not bringing the prospective buyer around at an inappropriate time and it allows you to clear up any personal belongings you may wish not to have on show. It is recommended by Estate Agents that while a property is for sale, it is kept as clean and tidy as possible to help with the sale, as the first impression of a house is the most important to the buyer.
Once you have accepted an offer on your house, although the general work will move onto other professionals such as solicitors, the Estate Agent still stays involved within the process until the sale is completed and the keys have been handed over. This is so that if anything does go wrong during the sales process then they are aware of it and can help to fix it. Estate Agents do not get paid until you have sold your house, they therefore, have a vested interest in the sale process and can still negotiate between you, the buyer and your relative professional bodies, for example your solicitors. When you have completed the sale of your house, you will pay the Estate Agent their fee and you will end your contract with them, with hopefully a healthy profit in your pocket.
Services Estate Agents Provide Buyers
The first thing most people do when they want to purchase a property is to go to Estate Agencies and look at Estate Agent advertisements and mailings. The services an Estate Agent provides for you the buyer is their sales portfolio, which includes listings of all the properties that they are trying to sell. The Estate Agent will ascertain what specifications you require a property to have and the price range that you are looking within, so that they can recommend properties within those specifications and the price bracket that they have in their sales portfolio.
When they have shown you their publicity material for the properties that they recommend fit your specification, and any that you have seen in their portfolio that you are interested in, they will start to organize viewings. This involves finding out when you are available to view properties and arranging with the property’s owner when the property is available to view. When a viewing has been organized, an Estate Agent will either arrange to meet you at the property, at their shop or may even pick you up from your home to take you to the property.
The Estate Agent will then take you around the property, making sure to show you all the features of the property. Although be wary as the Estate Agent is under the contract with the Seller, hence they are employed by the seller and so will want to sell you the best aspects of the property. Make sure that you inspect the property thoroughly and that if you are interested in the property you have minimum of two to three viewings preferably at different times of the day, so you can be as informed as you can about the property, by seeing the property in different lights. If you are only viewing properties at night, then the artificial lights may be hiding a feature or aspect of a property which is noticeable during the daylight and vice versa. It is also important to get a feel for the area at different times of the day, as some areas can appear very different in the day than at night.
If you are interested in the property and want to place an offer, then the Estate Agent can advise you as to what offer you should make the owner in order to secure the property. However, be wary as they are employed by the seller and hence have the seller’s interests at heart, as they want to get the best price for the seller as this will then be passed on to them through the money they receive as their commission fee. The Estate Agent is also bound to put forward all offers that are made on a property to a seller, so make sure that you have done your research and know what an acceptable offer to put forward is in order to secure the property.
Once your offer has been accepted, the Estate Agent may require you to put down a deposit on the property, which they hold in a separate client account. If you do put down a deposit make sure that the Estate Agent is covered by an adequate insurance policy and make sure that you receive a receipt and that you keep it in a safe place, as you may need it for proof of deposit at a later stage. From this stage on the Estate Agent’s services take a back seat, as you will have to deal with your own solicitors and chartered surveryors. However they are still there and can be called upon to try to hurry a sale long. The last service an Estate Agent provides for a buyer is the hand over of keys from the seller.
Tips for Choosing an Estate Agent
- Find an Agent who belongs to an Ombudsman Scheme
- Get Recommendations
- Check that they have Good Reputation in the Area
- Check whether the Agent has links with the community
- Check how Old the Company is and the Experience of the Agent
- Check whether their Commission Charge is Appropriate for the Service they are Providing.
- Ask yourself whether you Feel Comfortable with the Agent
- Do you trust the Agent
- Do they Look you in the Eye
- Will you be treated as a Special Customer
- Make sure you do your own Research on the Estate Agent and the Property so that you are as Knowledgeable as possible and can make Informed Decisions.
- If you have any Doubts do not sign Contract.
Here is a link that may be helpful to those looking for the services of a ‘for sale by owner’ website that lets you sell your house privately: Private house sale sites reviewed.