Image From: Channel4.com
Today MPs will decide whether to back a ban on ‘double-charging’ by estate agents. MPs are becoming increasingly worried about the trend, referred to as ‘double-charging’ which sees agents charging fees to both the seller and buyer, often totalling thousands of pounds.
Typically sellers are asked to pay an ‘admin fee’ when selling their property through an agent, for a property worth £200,000 this fee would usually be around 180. However the Property Ombudsman, Christopher Hamer, has explained how buyers are also being charged a 2% “introduction fee” in order to purchase the property through the sealed bids process. Again, if we take the example of a property worth £200,000, this introduction fee would cost the buyer an extra £4,800.
Coming out in defence of the practice, a spokesperson from LSL Property Services plc, said that buyer fees were only charged in a sale by tender and that it was the buyers choice to use this method. The practice is perfectly legal and agents claim that in a market of high demand for properties, they see it as a way to encourage more owners to put their property on the market as the seller only pays a reasonable “admin fee”.
Consumers are increasingly concerned over high agent fees and more and more price-conscious sellers are exploring alternative options like private sales, which circumnavigate a traditional estate agent and eliminate costly fees.
Estate agent’s fees have always been a concern and in today’s fast paced property market they are likely to once again become a hot-button issue. However it is unlikely that we will see a resolution in the near future, as since the Office of Fair Trading (which used to regulate and enforce estate agency rules) has been disbanded, there is in fact no single industry regulator responsible for the sector.