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Old 08-05-2008, 12:30 PM
 
Location: Barrington
63,919 posts, read 46,452,709 times
Reputation: 20674

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Apples and oranges???

In large cities of the U.K., Estate Agents charge from 1.5% to 4% of the house price, with 2.5% being the most common fee. Typically, those who charge less, have incremental charges for advertisement and sometimes even a fee for each showing. There is not yet an equivelent of an MLS in the U.K.

The concept of co-operating agency is begining to take hold in the U.K. for the same reasons as it did, in the U.S., exposing property to a wider audiance and defining duty/responsibility. When there is another agent involved in the transaction, the fee doubles.

Estate Agents are also required to charge VAT, 17.5%

For example, a £200,000 property at 2.5% commission is £5,000 plus 7.5% (£875), which means £5,875 in total commission and twice that, if two agents are involved.

Expressed in USD, the comission costs $11,476- $22,952 on a home sold for $390,621.
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Old 08-05-2008, 12:35 PM
 
Location: Central Texas
20,958 posts, read 45,182,148 times
Reputation: 24736
[quote=London Girl;4739026]
Quote:
Originally Posted by TexasHorseLady View Post
Brandon says it best in that last paragraph. If an agent will easily and habitually give up some of their own paycheck, are they really going to be any better at negotiating for your money?[/quote]


I can see where you're coming from but would ask you whether it's more astute to get 100% of nothing or 50% of something - the local agents we spoke to were actually the worst negotiators of all when it came to getting or losing our business!
Shouldn't you be asking yourself that question? The thing is, it's not necessary to take 50% of nothing, when you have clients who value, and are willing to pay 100% for, your expertise. Those are also usually the clients who are most willing to do what it takes to sell their house or find a house to buy, while those who are focused on the commission frequently tend to be the ones who are going to make it difficult to get the job done, who work against their own best interests and yours.

Agents are not required to work with anyone who wants to use their services; we can say no. Some buyers and sellers lose sight of that.
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Old 08-05-2008, 12:42 PM
 
27,206 posts, read 46,537,403 times
Reputation: 15661
[quote=TexasHorseLady;4739382]
Quote:
Originally Posted by London Girl View Post

Shouldn't you be asking yourself that question? The thing is, it's not necessary to take 50% of nothing, when you have clients who value, and are willing to pay 100% for, your expertise. Those are also usually the clients who are most willing to do what it takes to sell their house or find a house to buy, while those who are focused on the commission frequently tend to be the ones who are going to make it difficult to get the job done, who work against their own best interests and yours.

Agents are not required to work with anyone who wants to use their services; we can say no. Some buyers and sellers lose sight of that.


Same is for clients and who will lose out in the end
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Old 08-05-2008, 12:43 PM
 
Location: DFW
40,919 posts, read 48,847,042 times
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In a Buyers market any agent would be foolish to cut their commissions. It's a whole lot more work and expense to get a home sold.

I can see an agent reducing a commssion when homes sell as fast as they hit the market. But today a good agent earns every penny.
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Old 08-05-2008, 12:47 PM
 
1,422 posts, read 2,295,230 times
Reputation: 1188
[quote=TexasHorseLady;4739382]
Quote:
Originally Posted by London Girl View Post

Shouldn't you be asking yourself that question? The thing is, it's not necessary to take 50% of nothing, when you have clients who value, and are willing to pay 100% for, your expertise. Those are also usually the clients who are most willing to do what it takes to sell their house or find a house to buy, while those who are focused on the commission frequently tend to be the ones who are going to make it difficult to get the job done, who work against their own best interests and yours.

Agents are not required to work with anyone who wants to use their services; we can say no. Some buyers and sellers lose sight of that.
Well we weren't the Buyers From Hell if that's what you're implying !!!!!!!!

We were well informed, fully financed buyers who had fully researched our market, had viewed over 30 properties direct with listing agent and at open houses. We knew exactly what we were looking for and at what price.

At this stage, having found the property we eventually bought, we began to enquire about fees. The agents we spoke to locally all basically said "Oooh - none of the agents in this town (and in this particular Realtors Association) will give buyer agent discounts"

So, we went elsewhere.
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Old 08-05-2008, 12:48 PM
 
27,206 posts, read 46,537,403 times
Reputation: 15661
I never heard of showing fees in Europe and since I never heard of it and never paid it in the transactions we or family members did. Our realtor send out cards to let clients know that a home is listed and would invite them to come to a open house kind of thing. (like inventation only). Our home was sold that day, so within 2 days of listing and not paying any other fee to the realtor. Of course there are othere items you have to pay for in Europe but we are talking about commissions here.

Maybe the person talking about vieweing fees can put up a link...I know if I haven't heard of it, it doesn't mean it doesn't exist....maybe that is done by a special kind or realtors of which I never heard.
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Old 08-05-2008, 01:05 PM
 
1,422 posts, read 2,295,230 times
Reputation: 1188
Quote:
Originally Posted by bentlebee View Post
I never heard of showing fees in Europe and since I never heard of it and never paid it in the transactions we or family members did. Our realtor send out cards to let clients know that a home is listed and would invite them to come to a open house kind of thing. (like inventation only). Our home was sold that day, so within 2 days of listing and not paying any other fee to the realtor. Of course there are othere items you have to pay for in Europe but we are talking about commissions here.

Maybe the person talking about vieweing fees can put up a link...I know if I haven't heard of it, it doesn't mean it doesn't exist....maybe that is done by a special kind or realtors of which I never heard.
Yes, that's correct - the listing agent will do "open houses" - idea being that prospective buyers all show up together and hopefully create a "buzz" about the home which might, in turn, help it to sell. It's the same thing as agents arranging viewings back to back so that new prospective buyers show up whilst other prospective buyers are still viewing - to create the sense that lots of people are interested in the property.

I too would like to see a link to "viewing fees" - I have never, ever heard of this happening!!!!

Nor have I ever heard of 4% sellers agent fees - yes, you pay more if you are listed with more than one agent - maybe up to 2.5% - but with the advent of websites like PropertyFinder, RightMove etc many sellers are now using discounted agencies. Agents know that they still have to get properties onto those websites if they're going to reach the biggest markets.
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Old 08-05-2008, 01:10 PM
 
Location: Barrington
63,919 posts, read 46,452,709 times
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Quote:
Originally Posted by bentlebee View Post

Our realtor send out cards to let clients know that a home is listed and would invite them to come to a open house kind of thing. (like inventation only).
Now that's a marketing Plan.
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Old 08-05-2008, 01:16 PM
 
Location: Barrington
63,919 posts, read 46,452,709 times
Reputation: 20674
Tough times in real estate all over.

House prices plunge again – as estate agents raise their fees - Home News, UK - The Independent
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Old 08-05-2008, 01:18 PM
 
1,422 posts, read 2,295,230 times
Reputation: 1188
Quote:
Originally Posted by middle-aged mom View Post
Apples and oranges???

In large cities of the U.K., Estate Agents charge from 1.5% to 4% of the house price, with 2.5% being the most common fee. Typically, those who charge less, have incremental charges for advertisement and sometimes even a fee for each showing. There is not yet an equivelent of an MLS in the U.K.

The concept of co-operating agency is begining to take hold in the U.K. for the same reasons as it did, in the U.S., exposing property to a wider audiance and defining duty/responsibility. When there is another agent involved in the transaction, the fee doubles.

Estate Agents are also required to charge VAT, 17.5%

For example, a £200,000 property at 2.5% commission is £5,000 plus 7.5% (£875), which means £5,875 in total commission and twice that, if two agents are involved.

Expressed in USD, the comission costs $11,476- $22,952 on a home sold for $390,621.
Agreed on the VAT - I'd forgotten that.

However, I've sold in hot and cold markets and never paid more than 1.25%.

And I'm talking about London. I've never heard of anyone paying 4% to sell

As far as the MLS goes, well, we have websites like RightMove and PropertyFinder to name just 2 - every selling agent will list properties on there because they know that the internet is now the single biggest resource for buyers to research.

The agent fee does not double in the sense that you pay each agent 2.5%. You only pay the agent that sells the home. The "double fee" is that you pay 2.5% to the agent that actually sells the property rather than 1.25% if you were listed with only one agent.

The higher fee (1x2.5%) is somewhat justified here because each listing agent has reduced their chance of selling and therefore receiving commission by 50%.
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