Last week saw an interesting proposal on Dragons Den when an online estate agent pitched for a ‘revolutionary’ pay-per-view estate agency, WeSold.co.uk. An interesting concept and one I’m sure many potential sellers will prick their ears at – especially when you consider it is ‘just’ an upfront fee of £99 plus VAT. This is then topped up by a charge of £35 per viewing with a minimum charge for 3 viewings and a maximum charge for 12 viewings.
The Dragons immediately hit on the problem that faces anyone choosing an online agency – the low fees reflect a low success rate. Peter Jones was quick to drill the agent about their success rate and when informed they had sold 70 out of 195 he was swift to point out, “Seventy sales out of 195 means that one out of every three customers are happy, and two out of every three are not.”
Based on these figures WeSold.co.uk has, in a little over a year, earned £25,500 from sellers without having to achieve a sale. And this is just based on them supplying three viewings. If they achieve their promised 12 viewings this rises to a staggering £64,875 from unhappy customers. And unlike most unhappy customers there can be no refund; this is the service they signed up for.
The argument for not using a high street agent is that we charge extortionate fees and do very little to earn it. When looked closer it is quite the opposite. Most high street agencies do not charge upfront fees for their standard service. They will immediately start spending their own money on marketing via websites and the local press, arranging and hosting viewings and negotiating on your behalf. They will only earn their fee if the property sells and at a price the seller is happy to accept – the price the vendor wants plus their fee. In short, a no sale, no fee commission structure incentivises an estate agent to negotiate the best price for you. And because they only get paid once the sale completes they are motivated to work for their client every step of the way, from initial instruction through to completion.
We’ll leave the last word to Deborah Meadon, equally unimpressed she said the question she asked as a seller was: “Who is going to get me the highest price for my house?
“But you make your money whether you sell it or not.”
Dragons Den – Series 12, episode 3 – Watch it here
Tips for choosing the right agent:
- Find out what is included in the agents fees – do they include floor plans, wide angle photography, energy performance certificates etc.
- How long is the contract – beware of lengthy contracts and tie-in periods.
- Find out what their marketing strategy is – are they going to arrange an open day, put it straight on the market, hold an early private viewing, or arrange video tours for London buyers.
- Who will be handling you sale – a senior member of staff or the office junior?
- Most important is their enthusiasm. Do you believe the agent can sell your home for the best price to your time frame?
To arrange a no obligation market appraisal for your Brighton & Hove property from Q Sales&Lettings call us now on 01273 622664 or email sales@qestateagents.co.uk.