Colin Shairp, director at Fine and Country Southern Hampshire talks about the signs of desperation in the property market:
‘I was passing a house that I have on the market during the week and as I looked at the “For Sale” board outside realised that another estate agent had tagged a sign on the back.
When I rang the property owner, the explanation was that the other agent had seen the house was for sale and had offered to join in the marketing effort for the same level of commission fee.
What the other agent didn’t do was ask to see the sales contract that had been signed with me so he could read its terms and explain to my client the risk of liability for dual fees when the property sold.
There’s a good reason for estate agencies asking clients to sign a sole agency agreement with them.
The first agent puts in the legwork, expends a great deal of effort without asking for any initial outlay from the client, and stands the risk of losing all that promotional spend if the property doesn’t sell or the client withdraws at the end of the contract term.
When you consider that one per cent commission on a £250,000 house is £2,500 (plus the dreaded VAT, I’m afraid) there’s not an awful lot of margin by the time office, staff, and marketing budgets have been met.
When another agent turns up, muscles in without so much as a by your leave, and wants to claim half the commission fee when the property sells through me I take a dim view.
Even worse, they don’t explain to my client that my sole agency agreement entitles me to all the commission but they will still be chasing the client because they want payment, too.
I also spoke to a client this week who was impressed that we were open all through the Easter holiday weekend.
But she was tempted to move to another agent with whom the house she wants is for sale because that agent charges a lower commission than me.
The catch is that £750 (plus the VAT, no doubt) has to be paid upfront and is lost if the house doesn’t sell.
What’s more, all through Easter she couldn’t chase up the house she fancied because the agent was shut!
When you want to sell your house, there’s more to the nuts and bolts of it than saving a few pounds in commission.
You need to buy the Rolls-Royce quality rather than something at Lada prices if you want the wheels to stay on.
If a second agent turns up when you already have your house on the market, make sure they talk to the agent you are already employing and that you do the same to clarify contract details.
You will be surprised how quickly some rival agents will be dropping a letter on your mat when your property goes on the market.
Some use software that immediately generates a canvassing letter when it spots a property for sale with a rival agent on the internet.
How desperate is that?
You can speak to Colin and his team at Fine and Country for further information by dialing 023 93 277 277.
If you would prefer, you can also email him via email@example.com
Also, check out the company’s website, at fineandcountry.com for more details.