A potential client approached me this week who has never sold a house before. Despite having lived in some outstanding property over the years, their circumstances meant that somebody else had always dealt with the buying and selling. After our initial conversation, their only question was how do I justify my fees
During a recent lunch party with several of their friends who each gave their own point of view on estate agents the questioned remained whether there was genuine justification of the fee owed to the agent.
The fees in this example are likely to be equivalent to the cost of a new medium sized car, so not insignificant. As I pondered my response I found myself caught between different points of view.
Is it enough to say that because the property is worth a lot of money the agent selling it should receive a large fee An agent may spend the same amount of time selling this house as they would a house worth a quarter of its value. Should the subsequent fee be four times less, then
What if I achieve a sale price that exceeds expectation and my fee It seems reasonable that I should be paid for this. And the questions rolled on, these are questions all vendors ask themselves before coming on board with an agent.
When the shoe is on the other foot, I know that I almost choked when visiting the Amalfi coast in Italy and was charged 7 for my slightly cooled can of Coke. Being in an expensive part of the world was somehow justification for the cost.
Anyway, the best way to answer this question, I decided, was to list all options available to the client, including online agencies, so that it became their choice.
We spent an amiable hour discussing the relative merits of each option and came to the mutual conclusion that each has its own benefits and flaws. We also concluded that there was very little to determine how you could protect against each to ensure the client received value for money.
This particular client may not have directly sold a house before but they know enough about life to ascertain that in the main you often get what you pay for. However, they also know enough to accept that sometimes you do not and sometimes you will never know.
In the end it turns out that for this client it wasn't about cost but ensuring that I was honest enough to understand that I couldn't guarantee a better outcome just because they were paying more for the privilege.
*The Secret Agent has been in property for almost 20 years and trained as a Chartered Surveyor. He enjoys nothing more than being involved in property and has invested in, renovated, developed and sold plenty of property for both himself and clients.
(In between selling property this agent loves nothing more than being involved in rugby and whilst slower and heavier, continues to be as involved as possible.)
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