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Agent accused of charging to view a property: Is this illegal?

An estate agent has been accused of charging prospective clients to view a property.

The claim has been made on Twitter by a journalist, Jem Collins, who is editor and director of journalism trade service Journo Resources.

Collins says in a tweet: “A house around the corner is for sale with a sign up saying ‘viewings £5pp, cash only, payable in advance’. Seriously lads, you are not a theme park.”

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Estate Agent Today has emailed Collins, asking the identity of the agency concerned, the location of the property and to confirm whether it was for sale or to let. EAT has so far not received a response.

One social media reply to the tweet has suggested that such an act by an agent would contravene the Consumer Protection from Unfair Trading Regulations, which make it clear that sellers or their representatives should not place a prospective customer under undue pressure.

Collins’ allegation - which has also appeared in the Grazia magazine - comes as both the rental and sales markets continue to operate at fever pitch.

If EAT can obtain more information on this allegation, it will appear here - so please check back.

Three years ago a BBC investigation claimed a letting agent was charging tenants as much as £300 just to view a property.

The Victoria Derbyshire programme interviewed prospective tenants who said they were told to pay refundable deposits - although they allegedly could not always get the money refunded. 

The agency in question said it made clear the deposits were non-refundable, and stated this on receipts given to prospective tenants.

  • Mike Riley

    Agents deserve to get paid for (surplus) viewings!

    When you include properties that fail to sell or are removed from the market, agents carry out a considerable number of viewings per completed sale. Yet the only viewing that actually generates income for us, is the one that results in the purchase.

    Regardless of how much interest agencies have for a property, they can only sell it once. Every additional viewing, offer and discussion with a potential purchaser, adds to our cost of sale.

    Many agents deploy a range of methods to minimise their exposure to this cost on popular properties.

    This includes

    Severely restricting times when viewings can take place.

    Restricting viewings to prospects in a certain buying position i.e. cash or with no property to sell.

    Stalling viewings from other buyers, when they are close to agreeing a sale.

    Placing the property under offer and taking it off the market as soon as possible, ceasing any further viewings.

    Not placing properties that are under offer back onto the market, even though a buyer is dragging their heels.

    Not relisting properties that are being undersold, in a market where prices have moved up rapidly.

    The malfunctioning and outdated economics of estate agency greatly influence the process for booking viewings and infuriate buyers.

    Given the shortage of property for sale and ultra competitive fees, charging for priority viewings is a means to offset that.

    Taking cash however..... is not the way forward and viewings are definitely worth more than a fiver!

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    Unbelievable response, but ‘we all know’ it’s true. Sand bagging on viewings is failing to do the best by your client, the seller. Taking money for viewings is a conflict of interest, it’s double-dipping. Alternatively charge a fee that reflects your worth for the job you do, and do the job properly. I guess building a trusting relationship doesn’t matter on a transactional basis since each client sells once on a blue moon. But long term word gets out in a community. Worse, it trashes trust in estate agents generally and opens the door perfectly for tech solutions the seller can operate and trust. Any consumer reading your response will hear “agents are lazy and don’t work for you, only for themselves”.

    Mike Riley

    Thank you Andrew for your response.

    The "we all know its true" says a lot.

    A model where "priority viewings" or "early access" are paid, followed by a period of free viewings works. Agent's can even chose to discount the sellers fee with the proceeds, if they wish.

    The payment would be for the position in the queue, not the viewing itself. The successful buyer gets their booking fee refunded on completion, therefore no conflict of interest.

    Having just sold my own property, I'd rather have chosen the buyer who has paid to see my house (and therefore has proved some motivation) than the one that didn't. Moreover, I'd like an agent that is truly incentivised to carry out more viewings.

    As an agent, I would have liked an income related to my cost of sale, especially with sellers that withdraw their listing.

    As a buyer who has missed out on numerous properties, because the agent withdrew the house from the market for some of the reasons above, I would happily have paid for access.

    The public are getting used to scarcity and reserving timeslots online for all manner of things, not least going to the pub for a pint.

    As an industry we can chose to ignore this or use it as a catalyst to start changing our financial models in a different direction.

    It's time we took a good hard look at how our services are monetised, because if we really dig under it, the economic model of our industry is not serving the agent, seller or buyer.

    The seller paying upfront isn't the answer, as we know.... but tapping into the demand side and (not on a transactional basis), probably is.

     
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    Mark Riley's response does not reflect the view of most professional estate agents. At the end of the day, the seller is our customer and we charge them for the service we provide. Ultimately, our job is to sell the property, regardless of how many viewings we conduct.

    We do not charge for viewings, our fees to sell the property covers this expense. If you know what is costs to sell a property, charge appropriately.

    For every property that has many viewings, there are others that sell immediately. No excuse for a poorly managed business.

    Mike Riley

    Hi Mike, thanks for your response.

    There are large parts of the market where the buyer, not the seller should be the one paying. As we know, this can't work for a number of reasons on a transactional basis. But, given how short supply is, why on earth are we charging sellers a full fee to list?

    Why should the sellers who complete their sale, pay the agents cost for seller's that change their mind? Sounds a bit unfair.

    There are a host of issues with our model that we suppress, because its just the way we do things. It might not be very nice to accept, but our model is broken and that is the reason our services, as an industry, have the reputation they do.

    The fact is, the public blame the agents, but its the economics of our industry that are at fault.

    Perhaps, we can chat more or you might want to come on a podcast? You can be the first guest to book (no charge:)

    Best wishes

    Mike.

     
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    How do you know that? Did you take a poll?

     
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    If the owner is aware and there is no conflict, who cares. You don't have to view or pay and if you're a serious buyer then £5 is a drop in the ocean. The lawyer will waste twenty times that during the process and nobody will bat an eye when they charge you £200 for searches and then use a search agent for £100, pocket the difference and take months get them back....someone should look at this and forget browsing twitter for a 2-bob story.

  • Algarve  Investor

    And agents wonder why they get a bad name...

    Sure, it's only £5, but it's still not really on. What is the need to charge £5 for a viewing? Just seems like a money-making exercise to me, to take advantage of the booming housing market. The sort of thing Del-boy would do to make a fast buck.

  • Trevor Cooper

    The tweet doesn't say an agent is involved. It's probably being offered privately and the owner wants to avoid the general public's ingrained perception of time-wasters.

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    If I had a fiver for every 'no show' I would be able to take a holiday! The only problem I have with this is that £5 really isn't enough to cover my fuel and time!

    Mike Riley

    Your sentiment is spot on Genevieve!

    The question of how much a viewing costs an agency is tough to answer, but its definitely more than £5.

    Cost of viewings is irrelevant, if your average fee is five digits, but sub that, its a material number when added up.

     
  • Kristjan Byfield

    Whilst we have never considered charging for viewings- we have often considered taking card details and then charging cancellation fee if they cancel less than 4 hours prior or are a 'no show'- especially for weekend viewings. Never implemented but always thought this would be a great way to establish who is really serious about a property. Charging to view though- that's not good.

    Mike Riley

    That would work.

    Charging for early access upto a certain date, then free afterwards for those buyers that want to wait.

    Refund the person who buys the property, so no conflict of interest.

     
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    Kristjan nails it!
    Take card details, if they don’t show charge them, just like a restaurant!
    Wasted viewings and no shows are a poor reflection on our industry. They assume the vendor has nothing better to do than tidy their homes and that we have nothing enter to do than waste our time.
    It’s not about making money it’s about respect.
    What’s more card details would enhance security for our staff!
    The tweet says we’re not a theme park, despite the face we’re often treated like one!

     
  • icon

    A VERY small price to pay and a brilliant way to put off the nosy neighbours, tyre kickers and time wasters. Give the £5 back if they buy the property and put the rest towards the sellers commission bill and you are on to a winner. Not sure cash only is going to be easy to account for but overall not a bad idea....

  • JAMES PHILLIPS

    A really really interesting discussion to be had. I wasted half of my day attending a long distance viewing but the applicant didn't do their research, didn't map out their journey properly and wasted my time being able to correspond with serious buyers back in the office. Time is money, there are seriously serial viewers out there who just want to rubberneck a property just for the sake of it, they are intrigued or just plain nosey. I can't see anything wrong with charging a late cancellation, perhaps even popping the said £5 charge into a local charity. Saying all of that.... how many times have you been caught in traffic on the way to a viewing, turned up late sweating and stressed.... swings and roundabouts. You're caught between a rock and a hard place vetting those not suited to a property and putting off volume to even look. Like I said, great discussion to have.

    Mike Riley

    If you were charging for viewings you could justify more staff and therefore, comit more capacity to the problem of dashing from one place to another.

     
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