Publicity-conscious online estate agency eMoov claims vendors in London have spent £861.5m on traditional estate agents’ fees in 2015.
eMoov accuses agents of “lining the pockets of their designer suits,” of “cashing in big time” and charging “a stifling amount of money to sell a property.”
Using Office of National Statistics data on transactions, Zoopla estimates on average prices paid in each borough, and agency fees calculated by MyHomeMove, the online agency says there were 108,891 property transactions in London last year - around 12 per cent of all transactions across the whole UK.
On the average property sold price of £579,478 across the capital, that’s an average fee paid of £8,460 per property.
Kensington and Chelsea accounted for the highest volume of fees paid, ahead of Wandsworth, Westminster, Lambeth and Camden.
A combination of one of the lowest number of property transactions across the capital and, an average house price of just £233,000, means Barking and Dagenham was the borough with the lowest total of estate agency fees across the capital. Traditional agents there received £3,400 per property on average.
“It’s no secret that high street agents are cashing in big time through commission based fees and, thanks to the inflated price of London property, nowhere more so than the capital” says Russell Quirk, eMoov founder and chief executive.
“The commission based fee structure is as outdated as other high street practices - such as sole agency agreements. A house is a house whether it’s built in London or Lancashire and some may argue that, because of the nature of the market and demand for London property, selling in the capital actually requires less work than elsewhere” Quirk contends.
“Had London’s 108,891 transactions sold through eMoov, we could have saved the capital £796.7m in high street fees” he says, adding: “The mind boggles as to how much money they [traditional agents] are actually making.”