Research by Estate Agent Today into fees suggests that British agents are amongst the best value anywhere in the world.
Six months ago we looked at fees in nine countries in addition to the UK; now we have updated those nine in the light of recovering housing markets, and we have looked additionally at three new locations.
Although the figures have slightly changed, the broad result is the same: British agents - typically charging anything from 1.25 per cent to 2.5 per cent in the current market - are remarkably low cost by international standards.
Here are the figures:
- Australia 3.5 per cent at least;
- Canada 3.0 in cities, up to 5.0 per cent in rural areas;
- Denmark 5.0 per cent;
- France 6.0 per cent;
- Germany 3.0 to 7.0 per cent;
- Ireland 3.0 per cent or higher;
- Italy 3.0 per cent or higher;
- Netherlands 5.0 or higher;
- Spain 6.0 per cent or higher;
- Sweden 4.0 per cent;
- Switzerland 4.5 per cent to 10.0 per cent;
- United States 6.0 per cent to 10.0 per cent.
We have compiled this list from contacting agents and their professional associations in the countries.
But comparisons, of course, have hidden dangers.
For example, agents in every country have discretion to discount their fees, especially in competitive markets. And British house prices are, generally, far higher than in most other countries so the absolute price paid to an agent is not necessarily less in Britain than in some countries overseas.
Likewise the kind of service provided also varies. In the US, for example, realtors justify their high costs because of the obligatory (and sometimes costly) property, business and legal training they must undertake, and because fees can be spread amongst several realtors when purchases are made through the multi-listing system.
And in Sweden and Denmark, estate agents are more tightly regulated by law than in most other countries.
However, the message is clear: even without the small but growing sector of online agents typically charging budget fees, the British agent is a bargain.
We will be looking at how charges compare in other countries every few months.
Comments
wow... it's really good information. thank you..
i agree with you http://goo.gl/1E8rZP
nice read this article....
@ James. I think the point is that you don't get what you pay for. If you charge 1.5% on a 300,000 property = 5,400 (inc vat). A lot of the time you are paying this for lesser photos than what you get with some of the online companies, you also in a lot of cases won't get a floorplan whereas online this seems standard, so even if you get a sale with your local agent it likely takes 5 times as long because the presentation and marketing is so bad. With service levels like this, and at that price is it really surprising people are going online for a better service at 1/10th of the price Answer: No. Not surprising at all.
It strikes me that the pessimism stems from the commenters on this thread having had some bad experiences with agents. Watching transactions attempting to go through without the assistance of a competent and capable sales progressor is laugher-bull, everyone is entitled to chose who they like to sell/list there property, you get what you pay for. Good value comes in many guises and if getting the cheapest quality of service is your priority, chose it, but agency adds more than can be measured, as the hundreds of satisfied and content customers can be named and remembered, conversely who cant complain about a lack of service from a faceless cut price online listing agent.........
It's disingenious (or just poorly researched) to state in this article that UK agents are good value. Just because a % is lower means nothing, It's to do with transaction numbers and property value.
Take France for example, the average property sale price is lower, the number of transactions are 70% of the UK and 50% of the popoulation don't even use Estate agents. Which means that French estate agents HAVE to put their prices high to survive on the few properties they do list. In the UK on the other hand, it is obvious to anyone that it is a strange business where 10 different businesses can exist on one street, most towns have 4 or 5 estate agents on average. The reason they can exist is because their average commissions are so high they can live off a handful of sales.
It is time for change and if it takes the internet to do it then so be it. Don't be old fashioned and join in the chorus of "any change is bad". Let the public vote, if online works then why fight it. Agents who charge Premium prices will need to offer a Premium service to survive.
I don't disagree that there is more to value than price but this article was specifically about value in terms of the fees agents charge. It's nice to see we're doing something right for a change in the eyes of the media!
@ Guest (Louise
Spot on!
This statistic is of no comparing value unless it is specified just WHAT other countries agents actually DO for their fee. Many do much more than ours.
There is more to value than price.
A look into the service level provided would be a better indicator.
The current trend (in London) of agents charging the buyer 2% introductory fee and doing little more than "organising" an open house with no after care for the buyer shows very bad value for money.
Oversubscribed open house viewings where agents are pushing to get the offers up to 20% over the asking price serve no one when weeks down the line the property doesn't value up.
So at 1% or 2% some agents do not represent good value for money.