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When cheap isn’t very cheerful

Price-v-Value1

Estate agents’ fees are always a hot topic! And it is true they can vary wildly.

In many parts of Stockport, fees can vary from 0.5% to 1.75% and there is considerable variation right across the country in every town or city. There are also online or low-cost agents offering headline-grabbing fees. Ignore their slick marketing and this misconception that they don’t charge fees! They are not a charity! They just start with a low base fee and add-on for this, that and the other! Thankfully despite some impressive growth figures, the online/hybrid agents still only represent a very low share of the market.

Cutting more corners than a Grand Prix driver

There is no way any agent doing their job properly can charge £500 or less and have a sustainable business model. They would have to cut more corners than a Grand Prix driver in several key areas just to try and break even or reduce their costs to a point where they cannot operate properly.

For a property to achieve its best price in the shortest possible period of time it needs to be well marketed. Online portal advertising isn’t cheap, neither are professionally designed marketing materials. However, the area where the seller can get really short-changed by a ‘cheap’ fee is the level of service they receive.

Think about it logically for a minute. If you have paid a fee up front to market your property, where is the incentive to actually sell it? After all the agent has your money whatever happens, whereas most high street agents do not receive any money until they have found you a buyer and seen the sale through to completion, which on average takes around 12 weeks.

Who got the “cheaper” deal?

Let me give you a scenario. Seller A) sells with an online agent taking one of their cheap up front packages at £594 including VAT at an asking price of £195,000. Seller B) decides to market with an established high street agent, also at £195,000 for a fee of 1.2% including VAT. Seller A has to arrange and conduct all their own viewings and receives an offer of £195,000 the full asking price. Job done! Result!

Seller B meanwhile markets his property with a high street agent –oh ok let’s say, Maurice Kilbride! who arranges photographs, an EPC and creates 3D floor plans, organises an open house event, puts the property on various portals and our own website, phones out to their established database built up over a number of years and does some specific Facebook marketing/advertising to promote the open day, the idea is to generate as much interest as possible, create some urgency and arrange a good number of viewings that will be conducted by highly trained sales professionals. The element of competition results in a number of offers and after some hard negotiation, the final selling price rises to £200,000 – 5 out of 6 of our last sales have achieved over the initial asking price!

So who do you think got the “cheaper” deal? Well seller A) comes out with £194,406 – seller B) £197,600 a whopping £3,194 extra in their bank account!

Quality inevitably comes at a premium

When an agency bases its business on charging rock bottom fees there’s no way they can attract the best level of staff because good people won’t work for low wages. The saying ‘if you pay peanuts …. springs to mind. I actually find it quite insulting that some online agents try to belittle what good high street agents do. I have 25 years industry experience, I am not a dinosaur, I respect all competition, embrace technology and firmly believe in providing the highest standards of customer service to buyers and sellers. But to suggest anybody off the street from any background with no experience can suddenly be a “local property expert” well I beg to differ.

Selling your home is probably one of the single biggest financial transactions most of us will make in our life. Quite often we need to achieve the best price for our home to facilitate our next move. The difference between a quick sale and a good sale can be thousands of pounds! Would you really entrust the sale of your biggest asset to anybody other than a tried and trusted, experienced property professional? Quality usually comes at a premium. If it didn’t why would some people shop for their food or clothes at Waitrose or Marks and Spencer when there are cheaper alternatives? maybe because they are synonymous with quality?

We are not a “pile them high, sell them cheap” agency

At Maurice Kilbride we are not a ‘pile them high, sell them cheap’ agency – we believe in trying to add quality and value to the whole process, although we do understand it’s a competitive market, which can only be good for the consumer and we always aim to be competitive.

But one thing we never compromise on is our commitment to looking after your property needs as best we can from the start to the end of your selling and buying journey.

Thanks for reading,
Maurice

Want to get a SOLD or LET sign outside your property quicker? Call Luke, Davina or myself and our team on 0161 428 3663 or email: mk@mkiea.co.uk for honest, expert, friendly – oh and of course free advice.

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