Estate agents are always in the mix when surveys are released that reveal the public’s ’10 most hated professions’. Forget selling your house, you can probably bet it on estate agents featuring in the top three.
In a world where only bankers are treated with more contempt, estate agents receive a notoriously bad wrap for lying, cheating and backstabbing their way to pocketing commission on your property.
Unfortunately, if you need to buy or sell a house, you won’t get too far without their service. So – the next question is – how do you beat them?
Adam Day reveals the 8 secrets of an estate agent.
1) It’s not an estate agent’s priority to sell your property
This one may come as a bit of a head-scratcher but believe it or not, not all estate agents will be desperate to sell your house. While your estate agent will pledge to their best to get your property off the books, all they’re really looking to do is get your house listed with them in the first place.
To an estate agency, that is more important than selling the house itself. It’s why estate agencies place such an emphasis on employing ‘listers’ or ‘valuers’, and it’s why the aforementioned positions are the highest paid in the industry.
You’ll always be promised exclusive customer service if you list your property with their agency. Things like ‘early access’ to a house that’s yet to hit the market or ‘priority’ service that gives you precedence over other people looking to buy.
This isn’t a result of them trying to sell you a house; it’s their way to get you to sell yours!
2) Agents are paid commission on listing your property
You probably take it as a given that estate agents coming out to view your home are waiting to sell a house before they get their big pay cheque. Wrong.
More often than not, the agents who come out to value your home will be paid a commission on just getting you to list your property with them. They’ll literally do whatever it takes to get you on their list.
Try not to be swayed too much by their first impressions of your property. In order to get your business, it’s not uncommon for agents to overvalue your house or tell you that there’s nothing wrong with it…when in fact, they have noticed the patch of damp in the corner of your bathroom.
Estate agents know that they’ll be competing with other agencies to list your property, so they won’t be afraid to make a generous claim about how much money they can get for your home.
3) Free valuation? Nothing in life is free…
On paper, having an estate agent come round to look at your property for free in order to value it is a pretty sweet deal. After all, their intentions are fairly innocent and they have your best interests at heart, right? Wrong again.
‘Valuers’ aren’t actually there to put a price on your home, they’re only there to get your property on the market…at any cost. They provide the service for free to get a foot in the door and grab your attention.
And after all, this has to be paid for somehow. Haven’t you ever wondered why estate agent’s fees are astronomical? It all adds up in the end.
4) Agents’ valuations are not accurate
To confirm what we’ve already hinted at, estate agents will only ever value a property with the view to getting you on their books. They’re on a mission to please you and earn your trust, not to sell your home.
Agents will value your property higher than they really think it’s worth, just to convince you to use them at the expense of any agency that may have given you a lower – more realistic – estimate.
It’s usually easy to tell if they’ve overvalued your house. Expect to be presented with a contract lasting anywhere up to 6 months, which gives them the right to sell your property. Why so long? Because they’ll never sell the house at the price they’ve valued it at!
They’ve got 6 months to work on bringing your expectations back in line with reality.
5) Estate agents don’t do a whole lot of work
It won’t come as a huge shock to find out that estate agents don’t have to do a great deal in terms of drumming up business. They play quite a passive role in terms of finding buyers and the internet has made their job a whole lot easier.
You’ve also probably heard estate agents talk about ‘ready made buyers’ just lining up to buy your home as soon as it’s on the market. They probably do exist but your estate agent knows nothing about them. What the agent does know is that the sooner they can get your property up for viewing on websites likes Rightmove and Zoopla, the quicker he’ll have potential buyers giving them a call.
Despite what an estate agent will say to you, agencies rarely have to go through a ‘mailing list’ anymore to find buyers. They just sit at their desk and wait for the phone to ring. They won’t tell you that, of course.
After all, they don’t want you questioning their ridiculously high fees…
6) Newspaper adverts are nothing more than a tabloid scandal
One of the first things you’ll expect to see after putting your house on the market with an agency is an advert for your soon-to-be-sold home in the property pages of your local newspaper. Unfortunately, that doesn’t always happen straight away and even more worryingly, it’s just another tactical ploy in the strategy book of an estate agent.
There are two main reasons for newspaper adverts. The first one is – once again – to encourage you to list your house with that agency. After all, if they’re paying to list properties in the newspaper they must take their role seriously? The second reason is to get YOU (the seller) off of their back.
If there’s no movement with your house for a couple of weeks, they’ll be sure to suggest that the agency sticks an ad in the newspaper to get the ball rolling again. It’s nothing more than a distraction from the real reasons that the house isn’t selling.
It probably boils down to that botched valuation they gave you in the first place…
7) ‘Professional viewers’ are a real thing
Estate agents love to tell you that they’ve got a pair of ‘hot buyers’ for your home. To back up those claims – and keep your trust – agencies have been known to employ ‘professional viewers’ to check out a property and feign interest.
Eventually, the ‘hot buyers’ turn out not to be interested (surprise, surprise) but the prospective seller has been so impressed with the estate agent’s initiative and ability to generate quick interest that there’s no chance to looking elsewhere to get the home sold.
This tactic was supposedly a thing of the past. I’m not so sure.
8) Estate agents don’t want to get you a high price
Sorry to burst a bubble, but estate agents simply don’t care about getting you a good price for your home. All they want is for you to agree on a sale. Estate agents are trained to ‘convince’ a property owner to accept an offer that’s significantly lower than the asking price. It all comes down to business.
Estate agents are – on average – paid a fee of 1.9% for any property sold. If an agent receives an offer of £230k for a £240k property, they’ll earn a commission of £4,370. If they get you an extra £10,000 on the house (your asking price), they’ll only earn an extra £190. It’s not worth their time or effort to get you a better price. All they want is to tie your deal up as quickly as possible so they can move onto their next sale.
To combat this, you can use a fixed fee agent. They’re motivated to sell your house because they’ll be earning a flat fee on the sale – but they don’t need to sell the house quickly or force you to accept an offer you don’t like. If they’re ‘advising’ you to accept an offer, it’s usually because it’s the right thing to do.
Estate agents want their pockets lined, not yours.
Article Provided by: Adam Day, co-founder Hatched.co.uk