Updated: Sep 30, 2020
It is an annual poll carried out by the organisation Market and Opinion Research International, which surveys the nation's trust in professions. Sadly it paints a picture of an all too negative perception for the average estate agent.
Just 30% of British adults (aged 15+ interviewed face to face during 18-27th Oct 2019) "trust estate agents to tell the truth".
Estate agents feature in the 5 least trusted professions, along with journalists, advertising execs, government ministers and politicians generally. Here is why we think this is the case. If we believe that financial remuneration drives a certain behaviour in business, then it is no wonder that estate agency in some quarters has a questionable reputation. Estate agents are not bad people. The vast majority of property industry employees want to do a good job, to help people to move home successfully and with the least fuss and to earn a reasonable living for themselves. But the problem with the traditional estate agency model is that the way that its people are paid is not necessarily conducive with a great experience.
What exactly do we mean by that? Believe it or not, where a fee of say 1.0% + Vat of the property sale price is earned, an individual agent can sometimes earn just 5% of that (plus their basic salary which is anything between £12,000 for a trainee negotiator up to £30,000 for a long serving branch manager). For example, if we take a £300,000 property where the seller pays a fee of £3,600 including the Vat, the agent earns £150. Yes they can earn extra commission by selling additional services such as mortgage referrals or conveyancing but usually these extra services don't benefit the client as they pay a premium for these services. Some large corporates state on their website in the small print that they get paid £350 for referring their preferred conveyancer where the conveyancer charges the customer anything from £599-£899 depending on the property value. The agent who sells the service gets around £20 of the £350 and in all honesty what sort of service will the client get if the conveyancer is only earning between £249-£549 per transaction. We would suggest using a conveyancer who is going to give the buyer/seller a much better service as the legal process is a pivotal part of the process and here at Save Money Selling we don't want referral fees on extra services we offer we just want to make sure our clients are using the right people to help them achieve their goal of either selling or buying a property. Mortgage services are offered by agents and they pay an 'lifetime' fee to the broker. This fee is usually around £500 and some brokers charge the fee in advance before the mortgage has even been offered. All mortgage brokers get paid a procurement fee from the lender and this can vary from lender to lender so why should the broker charge their client too. It's wrong, unethical and in our opinion should be illegal. These proc fees that brokers get can be quite a hefty figure depending on the loan amount so again how do you know that you are getting the right advice on the mortgage being offered by the broker. At Save Money Selling the brokers we work with have access to almost all of the mortgage deals available and guess what? They won't charge our clients any fees.
In addition, each transaction might take six months to complete. Motivating? A remuneration approach such as this can potentially encourage apathy towards customers. It can also force agents to run from one transaction to another trying to spin many plates in order to try to earn a decent income. Inevitably, those plates can drop when there are too many to keep spinning at once. It is incompatible with a positive outcome for the customer and can only serve to make an already stressful process worse. But what if, as with Save Money Selling the agent that does the work and faithfully attends to the customer 24/7, were to be paid a larger proportion of the commission whilst offering the customer a fairer and better value fee, instead of that money being channelled toward multiple branch office rents, rates, staff, car leases and so on? Well, that’s the way that the Americans have been selling real estate for decades and is the reason why, unsurprisingly, the USA has a much better reputation for real estate service and efficiency. Save Money Selling isn’t an American business operating in the UK. It is a company that wants to give its customers an unrivalled personal and bespoke service for a fair and much better value fee than traditional agents who simply charge far too much for not a lot in return. If you pay people properly so that they enjoy their work, covet success and deliver exceptional customer service, it is a win-win for all parties concerned and that certainly drives good behaviour in any language.
If you would like to know more about who we are and what we do, please get in touch at firstname.lastname@example.org or 01273 978688. We would love to have a chat.