An obvious but appropriate topic for my inaugural blog post.
More and more people use property search agents to find the right home faster and avoid overpaying. There are at least 200 property search agents in the UK. With the exception of a few big firms, most are one or two man bands. But just because anyone can set up business as a property finder doesn’t mean everyone does. So I wouldn’t fret too much about cowboy operators simply because success fees are only payable when you’ve exchanged contracts – and you’re hardly likely to be manipulated into buying somewhere you don’t want.
To make the right choice you need to know two things. Firstly, what personal qualities should you seek in an agent? To a large extent this is a question of personal chemistry. Secondly, how do competing firms work? Understanding this is important in getting the best value for your money. Knowledge counts more than judgement here.
When it comes to choosing an agent, it’s a people business. Property is a very personal thing. Search agents’ clients are looking for something quite specific, even a little unusual. When you’re paying someone to be your eyes and ears in a market it’s important that they’re on your wavelength. Good property finders will be curious about your tastes and needs. They’ll be interested in why the right place has eluded you to date, and keen to understand your experiences, good or bad. You need someone who has ample confidence and presence to deal with professional sales people effectively, but is also thoughtful and sensitive to your individual requirements. Every client is different and should be treated accordingly. Good search agents will be happy to discuss your requirements on a no-obligation basis, and offer free advice to help you decide whether to use them or not.
Whereas estate agents won’t always say why your brief is proving so difficult, a good search agent will be direct about the issues, without being rude. It’s not in their interest to take on briefs where the property in question simply does not exist. Instead expect constructive suggestions on how to move forward. If what you’re looking for doesn’t exist, how else might you find what you want? If your budget won’t stretch to (say) a 4-bed character detached property in your chosen area, a good agent should be able to identify an area you hadn’t thought of that will suit you every bit as well.
When it comes to discriminating between organisations, big isn’t always beautiful. A few property search firms offer national coverage, but many more will specialise in a much smaller area they know well. Size isn’t everything. Bigger firms have higher revenues and marketing budgets, but that’s not the same as better quality service for clients. Several of the big players are franchise operations. Nothing necessarily wrong with that, except that quality in the property search game can’t be centrally standardised and guaranteed in the same way as when you’re buying hamburgers or skinny lattes. Best ignore the branding hoopla and look carefully at the strengths of the individual you’re considering in the area you want to live.
Fee structures are all pretty similar. You pay a non-refundable registration fee, with the balance as a success fee based on a percentage of the agreed sale price. But fee levels vary a lot. Registration fees range from £500 to £2,500. Success fees range from 1% to 2·5% of the sale price. Higher commission rates can reflect market positioning as much as superior quality service – some agents concentrate on properties well over £3 million and charge accordingly. At the very top end it’s an insider world. So if you’re in the market for a Kensington mansion or a beach front in Sandbanks, a premium priced service may be unavoidable yet still represent good value for money.
Elsewhere, higher fees may simply reflect office overheads (particularly pricey in London) and/ or outsourcing the labour-intensive search work invisible to clients. You may effectively be paying more for less of a senior person’s time and attention. Such a set-up has obvious commercial advantages but the benefits to you as a client are more debateable. Some firms simply “harvest” clients and sell them on to third party freelancers at a mark-up. No doubt these freelancers are perfectly capable, but whether you’re happy paying a premium to a middle man is up to you
None of this is to say that any particular type of search agent is automatically better or worse than another. But it’s more a question of “horses for courses” than “you only get what you pay for”.