Fees  

Estate agent fee disparity worth thousands of pounds

Estate agent fee disparity worth thousands of pounds
 Credit: Jason Alden/Bloomberg

There is significant disparity in the commission and fees charged by residential estate agents.

A nationwide survey of 135 estate agents by property platform WiggyWam in January found the difference between fees charged varied by thousands of pounds.

The lowest and highest fees charged by commission agents were 0.5 per cent and 2.5 per cent respectively, with the average at 1.2 per cent.

For a property priced £250,000, which is close to the average as of December, this would equate to agents charging £1,250 at the lowest fee and £6,250 at the highest. 

According to the research, two-thirds (65 per cent) of agents charged a commission fee between 1 per cent and 1.49 per cent.

One in 10 (11 per cent) charge at the higher end of over 2 per cent, while 10 per cent of agents charge less than 1 per cent.

For agents who operate a fixed-fee pricing model the average fee was £1,702.

The lowest fixed fee reported was £100 per property, while the highest was £8,000.

The property platform noted that any agents charging a fixed fee of around £100 were most likely operating a hybrid pricing model.

It described the range of fixed fees charged as a “striking disparity”, with the lowest, highest and average figures all sitting far away from the £3,000 average when operating a commission-based model.

Marc von Grundherr, director of estate agent Benham and Reeves, agreed there was a “huge disparity [in fees] between one agency and another and from one town to the next”.

However, he said: “[A] low-fee agent is likely to result in longer selling times, lower sold prices, less support and a more disjointed selling process.”

chloe.cheung@ft.com

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