Beware of estate agents double charging fees
Well it is a wheeze if you can get away with it but immoral as far as most of us are concerned but some estate agents have been getting away with charging buyers and sellers for the privilege of buying a home that is on their books. This is a recent phenomena caused by the lack of available homes for sale and the desperation of some buyers to buy a property. It is only fair to point out that this practice is only being used by a small number of agents but it is possible it will catch on of the agents think they can get away with it.
Buyers are being asked to pay 1.5% to estate agents in order to secure a sale
This would mean they would be doubling their fees overnight because if many instances they are charging vendors and buyers 1.5% each. So on a sale price of £400,000 the agent will be looking to charge an average of of 1.5% to the vendor and 1.5% to the buyer. This means that the estate agent would be banking a fee of £16,000 for the sale of one single house. Many property insiders have said that this practice is seen as outrageous and are asking the government to stamp it out.
Government need to stamp out this bad practices
Estate agents normally charge the vendor a commission of between 1.5% and 2.5% to sell a property. The buyer would never be charged a commission as they are saddled with other buying costs such as stamp duty and arrangement fees for mortgages etc. If this practice catches on it could be the biggest cost a buyer may face when purchasing a home.
According to the National Association of Estate Agents there is nothing wrong with this practice as long as estate agents are clear from the outset what their fee structure is. It may be fair to say that this double charging may become widespread particularly if the government does not stamp it out.
Some estate agents are asking for deposits when buyers make an offer
The problem is that there is simply not enough homes for sale and buyers are being manipulated into jumping through hoops in order to secure a sale. There are other reports today in the guardian that some estate agents now asking for a £2,000 deposit when they make an offer on a home. Those of us that have been around the block would smell a rat and tell the agent to get lost but there are vulnerable first time buyer out there that will get suckered into paying this deposit with little chance of getting it back. It is something that the government will have to take a look at and many of us are hopeful that these bad practices will be outlawed by the government.