When it comes to selling a property, estate agent fees can be a considerable amount. For instance, an estate agent commission rate of 2% on a property for sale for £300,000 is a staggering £6,000. However, armed with some basic negotiation tips you can reduce these fees significantly.
You are likely to find that the more established agents in your area with a larger market share are harder to negotiate with than those agents that are less established. This does not mean that they will not budge with their fees if you use the right tactics and techniques.
Talk to a wide range of estate agents, book appointments with both nationwide chain estate agents as well as smaller independent agents. Remember, the estate agent is working for you so have questions ready for to ask them so you know exactly what they plan to deliver for their fee. For every agent that you meet with make a note of their commission rate, the service they are offering as well as their terms of business (in most cases the sole agency contact).
At the end of every appointment say to the agent that you have other agents to meet with and that you will be in touch soon.
Preparation leading up to the Negotiation
Keep in mind that estate agents do not keep in business by turning away clients. Though an agent may initially quote you a rate of between 2 to 3% commission, always aim to get the rate to as close to 1% as possible.
Presenting your property as an easy sell will work wonders when it comes to the negotiation. Do your research and be realistic about the price your property is likely to sell for. Try to present both the interior and exterior of your property to make it not only as attractive as possible to potential buyers, but also to the estate agent.
An agent is far more likely to come down to 1% commission for a property they feel can sell itself, than one that is overpriced and unattractive.
To negotiate successfully, have your facts and any counter arguments at the ready and be prepared to hold your nerve.
By this point you will have seen enough agents to have narrowed it down to two or three. Invite each agent back separately, but do not mention fees or other agents until near the end of the appointment. The aim is to get the agent set on selling the property and the commission it will bring in.
When you open negotiations the agent will almost certainly start at 2% or over. When you hear this figure act a little shocked and explain that you cannot possibly agree to that rate. Begin your counter argument as to why you should only pay 1%.
If there are similar properties in the area that have recently sold make sure you know about them. If your property is in good condition, reasonably priced and you can evidence that there is already a demand, you can argue that your property will be a quick sell with minimal work for the agent.
Watch how the agent reacts when you say you cannot agree to their fee. Let them know that you have other agents that you are considering and that although you really like the service they are offering, the commission rate will be the deciding factor.
If you know of friends or family who have paid a low rate of commission with one of the local agents this can be the ultimate bargaining tool. If all else is failing and you really want to use a particular agent but the commission is a little bit too high, say to them that estate agent ‘A’ has quoted ‘X’% even if it is not an agent you plan to use. You would be surprised how often this will get an agent to reduce their rate.
Negotiating with the estate agent on selling fees will save you a great deal of money. It’s not as daunting as it may sound and if you do your research and stand your ground you will almost certainly be successful!