Ashford Office 01233 506260
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I think you will agree, it is fair and sensible to have an agreement with your estate agent which sets out what fee will be charged if they sell your house for you.
So why do some estate agents ask you to sign an agreement which locks you in for up to 12 weeks?
Is that really in your best interest?
The simple answer is no it is not!
Agreed, the agent spends a lot of time, money and effort marketing your house and normally only gets paid if they successfully sell it for you.
That is of course unless you choose to take a chance on an online agent, in which case they take your money up front and it is up to you to sell your house and see it through to completion! But that’s another story!
The problem arises when agents, usually motivated by personal commission to bump up their monthly pay, become a little over eager to get your instruction to market your home. The temptation is for them to tell you that your house is worth more than it really is compared with comparable properties in the market. You are naturally pleased to hear the higher valuation and before long they ask you to sign their 12-week agreement.
Nothing wrong that you might think – worth a punt at the highest price.
Maybe you get lucky, but more often than not this is the point where the difficulties begin.
You will know yourself that when you start looking for a new home you quite quickly get a grip on the market and figure out what prices properties should be. The internet helpfully provides you with lots of evidence. You soon decide if a house looks too expensive and move on down the list.
Your house is now one of those on the internet that is being ignored and glossed over. Buyers are not calling your agent to ask about it and nobody is coming to view. A couple of weeks have passed and there is a deafening silence from your agent.
So, you call your agent to find out what is going on. They say “it is early days” or “the market has gone a bit flat in your area” or “it’s the wrong kind of weather!” etc etc.
Your house is not selling and the houses that you are interested in buying are. You are missing them. You start to wonder whether you picked the right agent. But you still have 10 weeks left on the lock in agreement. It looks like you are stuck with them.
Reluctantly, you ask what can be done. Their answer is of course to drop the price. Their intention all along.
Unfortunately this is the point at which you can start to lose thousands of pounds.
In order to sell, you have to drop the price, probably to where it should have been in the first place. But savvy buyers will see you have done this and start to circle. They know you want to, or even have to sell. They see their opportunity and start making low offers. They are taking advantage of your dropping price. You are now on the back foot and your choice is either to sell at a price you probably aren’t happy with or stay where you are and don’t move. Neither of which was what you set out to do.
We see this happen every week.
Estate agents looking after themselves with their long lock-in agreements, when they should be looking after you.
As an independent company, we do not have to get involved in those sorts of practices. We pay our staff sensible salaries so they do not have to rely on their commission to pay their bills. They are free to act in your best interest and give you good advice.
We do not lock you into our agreements. If for any reason you want to change agent then you can at any time and immediately.
The upshot is we do not over value your house.
We use our experience of the local market and evidence of the prices of similar properties that have recently sold to give you the proper market price. This is essential because the first few weeks of marketing are the most fruitful for you. It is then that we offer your house to a waiting pool of eager buyers . If it is at the right price your property will not be ignored. Quite the contrary, we get phone calls asking questions and we make arrangements for them to come and have a look around. Buyers will often compete with each other to purhase your house.
If this first few weeks of critcal marketing is messed up with an inflated asking price then that pool of buyers disappears and you are left with just the new buyers slowly coming to the market - one at a time.
Successfully selling in the first few weeks allows you to go and buy the house you had your eye on, rather than being frustrated as someone else buys it while you are waiting for viewers.
When you employ an Estate Agent you expect to receive experienced and professional advice. We operate under the Royal Institution of Chartered Surveyors (RICS) Real Estate Agency Code. All designed to give our customers good advice and ensure that we do our job properly.
Please do not get caught out by unrealistic high valuations, as tempting as they are.
And please do not sign long-term agreements that lock you in.
Done right, the marketing and sale of houses can be a relatively straight forward and stress-free business. It's something we have been doing for a long time.
If you have any questions about how it all works please feel free to call me anytime and ask. I am always happy to help. Call me on 01233 506260
We look forward to helping you.
Managing Director, Hobbs Parker Estate Agents