Estate agency has historically been seen as a ‘cloak and dagger’ business, with little transparency or open communication with their clients. It’s a strange reputation to have seeing as an estate agent should be working with their clients not against them. You wouldn’t expect your Doctor or lawyer to keep things from you, so why should you expect less from your estate agent?
One of the key values of my Ivy Gate business is ‘Total Transparency’; a commitment to being open and honest with our clients, even if the message can be difficult to hear. Sadly, most estate agents don’t follow this guide and resort to underhand tactics to secure sales and, ultimately, earn more commission. I would rather we were a business with a reputation for honesty and transparency than for underhand tactics.
I have no idea what the collective noun for estate agents is (although when I googled this the responses suggested were ‘vomit’, ‘crash’, ‘swarm’ and ‘vacuum’) but trust me, when agents all get together in the bar, they openly discuss things that they wouldn’t dream of telling their clients. So, here are 3 things most estate agents are afraid to tell you;
1. Some Estate Agents over-price properties to win instructions
This is a tough one. We all know it goes on, but no-one wants to talk about it. If you have had a valuation in the last 3 years, I guarantee that if you had 3 or more agents around, they gave you differing prices, sometimes ten’s of thousands (or in some cases hundreds of thousands) of pounds apart. If you were to contact me and tell me which agents you had around, I could tell you which ones valued the highest and the lowest.
There are some companies that train their valuers to over-value by as much as 15% to win more listings. The rationale is that the seller will be impressed with the valuation and believe that the agent can achieve it. Sadly in many cases this isn’t the case. Within 2 weeks you’ll get a call asking you to reduce your price, normally by at least 10%.
The message is therefore clear – don’t go with the highest valuation simply because it is the highest. Choose the estate agent you trust the most, the one who sounds like they will represent your best interests, the one who turned up on time, who presented their rationale behind the price and the one who you got on with the best. Don’t forget that you will have to work closely with them for weeks (if letting) or months (if selling) so choose wisely.
At Ivy Gate, we make sure that we price as effectively as we can and whilst we will always aim for the best possible price, we won’t artificially inflate a valuation just to win business.
2. Some Estate Agents charge higher fees if they think they can get away with it
I regularly hear stories of agents who get away with charging higher fees to un-suspecting clients who don’t understand the fee structures in place. This is why you’ll hear agents talking about ‘average fee’ targets from their Directors. The theory is that in some cases the valuer will get away with charging, say, 1.5% rather than their more standard 1.25%.
How can they get away with this. The answer is in the detail of their marketing and website.
The vast majority of estate agents never publish their fees. Why? Because they charge what they can get away with. If they can get away with charging a higher fee than your neighbours, then they will. Customers end up paying different fees for the same service. This is how estate agency has been run for the last 50 years.
We believe that this is unfair. As part of our award winning customer service we have decided to be one of the very few UK estate agents to publish our fees. From a simple listing online for a fixed fee, to a full bespoke personal concierge style service, we have a structure to suit every type of client.
My advice, if an agent doesn’t have a printed fee structure to hand you, or are aloof about fees, then be prepared to negotiate on whatever they tell you is their ‘lowest possible offer’.
3. Some Estate Agents make up their ‘database of buyers’
Lots of agents spin this same line – ‘We have a database of 123 buyers (or some huge number) ready and waiting to view your home’. I’m sure that estate agents do have a ‘database’ of sorts, a list of applicants who have registered looking for similar properties.
However, most will stretch the truth here. The reality is that my business generates 100’s of leads from the main property portals every month. But not all of these register for a specific location or property. Many ‘speculative’ purchasers register looking within 5 miles of an area.
But agents will claim that these buyers are all sitting waiting for your property and can bring them around as soon as you instruct them.
This won’t happen. There will be a ‘hot list’, sure. 5 or 10 buyers who are actively viewing in a particular location. But the truth is that these buyers will be on every estate agents database, not just the one who you’re speaking to. If these buyers are so keen on your particular road, they will be registered with every local estate agent via rightmove and zoopla. These buyers will not be unique and will certainly not be exclusive to one agent.
The days of loyalty to one particular agent are over, the internet changed the nature of customer search over a decade ago. Don’t be fooled in to thinking that this ‘database of buyers’ is hard to come by, either. Once your property goes live on the property portals, new buyers will register with the agent who carries the listing. They don’t care who it’s on with, they sometimes don’t even remember the name of the agent when they turn up for a viewing, they simply see the property and call the number.
We prefer to be open about this common mis-conception and don’t take our ‘database’ out on valuations to impress our potential clients with our basic ability to use the internet. Instead, we prefer to build strong and trusted relationships with our buyers and sellers and offer the best possible customer service. By speaking to our buyers every week, we have a chance to build up a solid and trusted working relationship, rather than rely on inbound enquiries from rightmove alone.
There’s lots that agents won’t tell you. Most of it is simply an interpretation of the facts to their advantage. Most businesses in most industries ‘spin’ their messages, but it becomes a problem when they deliberately exaggerate to win your business. Choose the estate agent you instinctively trust the most, one who is open about their fees and one who doesn’t over inflate the value of your home to win your business, promising you hundreds of buyers who will view immediately. You will have a much better customer experience as well as a closer and more open working relationship with your chosen property professional.