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Home valuation now and discuss fees later

A former estate agent gives us the insider perspective on why Estate Agents won’t discuss fees up-front

March 25, 2014

What you’ll hear instead of fee details…

“Would you ask a plumber to quote for a job he hasn’t inspected?”
That’s one of the responses we were advised to counter with when a prospective client asked about our fees.

Never quote a fee until you’re actually at the property and have carried out the market appraisal,” our tutors would tell us. And the corporate giant I worked for at the time wasn’t the only estate agency to take such an approach – independent firms, large and small did exactly the same.

Why the reluctance in revealing commission rates prior to visiting the property?

Well, some estate agents will argue that no two properties are alike. Each one representing a unique set of circumstances – different owners and their expectations on pricing, where they hope to move to; will one house require more advertising or have a longer chain than the other and so on. With that in mind, is it right to quote exactly the same fee for two seemingly different jobs, and without inspecting each one first? If the answer to that question is no, then you can’t openly advertise one set commission rate for all, can you?

Let’s take a look at a real world scenario…

A prospective seller approaches the agency with a view to putting his house on the market. The man’s property is in a sought after road within the estate agent’s catchment. When the home owner asks what the sole agency rate is, the sales negotiators will be trained to give one of several replies. They may ask their prospective client if he’s already had quotes from other estate agents and what those quotes were. If the sales negotiator hears a fee equal to or above their own standard rate, his reply might be something along the lines of: “I’m sure we can match that,” or “we’re pretty much in line with our competitors/we have a flexible approach,” and so on. Any answer given will be quickly tailed off with: “We’ll confirm our fees once we’ve had a look around the property. When’s convenient for us to pop round?

What if the fee that the prospective seller’s been quoted by a competing estate agent is lower than the standard rate of the sales negotiator’s company? If so, the sales negotiator may still claim his company will match the fee, lying, purely just to get the appraisal appointment booked. Alternatively, in such scenarios, estate agents will cleverly deflect questions about fees and move to booking the appraisal. The bit about plumbers quoting for jobs may be tactfully applied at this stage.

Estate agents just want to get to the appraisal…

You see, even if he’s up against a competitor quoting a much lower fee, the agent will take his chances. Perhaps he’ll do or say something that will dazzle the prospective seller into instructing him at the higher rate.

Maybe he’ll counter the seller’s objection to paying higher fees by pointing to the BMW parked in the driveway and asking the seller why it was they didn’t choose a cheaper and less prestigious family saloon. Or, why did the seller opt for the 42 inch flat screen Samsung TV over the discounted model from the obscurely named manufacturer. The aim here is for the seller to agree that quality comes at a price – even when selecting your estate agent.

Finally, while to some extent I liked the ‘plumber quoting for a job he hasn’t seen’ line, I had a counter of my own for my estate agency tutor. I bet her fifty quid that it would be easier, given three days notice, to get five estate agents to a property than it would to get five plumbers there. She gave me a stare and muttered something under her breath, but she didn’t accept the wager!

 

Steve Lucas’ book “Inside EA: A Behind the Scenes Look at How Estate Agents Operate” is available now from Amazon.com

 

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