Expectations of estate agents differ from person to person, however one thing is certain: You want a reliable service and the trust that you are getting the best deal out of the selling process. The way that estate agents charge their services has been commission based for many years. Lately, the industry is seeing the rise of another service pricing method – the fixed fee – but is it really the most beneficial option for you?
Fixed-fee is a common method among online estate agents where a fixed amount is decided (usually depending on the location of your house) and it is due to be paid regardless of whether the house is sold immediately, slowly (and in some cases not at all!). Many estate agents started to opt in for this kind of technique, which started to create a new business model in the estate agency sector. However, this means having to pay even if you didn’t receive the quality of service you signed up for, which is not always the most attractive offer you can get. There are various reasons why, you should consider instead proceeding with your sale with the help of a commission based estate agency.
Here are the 3 fundamental reasons:
1- Fixed-Fee Kills Motivation
As fixed-fee agreements require the homeowner to pay no matter the result, the estate agencies are presented with lower motivation to find a potential buyer for the property. As they are guaranteed by law to be paid, there is low to no incentive for them to try hard to sell your property with high speed and at a higher price.
2- Commission System Makes You Win
Across a variety of industries, commission system calls for motivation and positive challenges for employees to undertake. Also in the real estate sector, commissions encourage agents to perform better i.e. sell the house at a higher price. This results to be a win from your part as well, as you may get more money in your pocket than you would if you were to sell your property via a fixed-fee agent, who don’t benefit financially from selling your property at a higher price.
3- Increased Marketing Budget
Another benefit to working with a commission based estate agent is the increased marketing budget allocated to selling your property. A fixed fee agreement may limit the amount of expenditure apportioned to market your property on effective and fast-return channels such as publications, telesales, and email marketing. On a commission based estate agency deal, it is likely your estate agent will have more flexibility in allocating the necessary amounts for marketing the property as the commission is only received after the sale starts to go through.
If you are interested in selling your property, contact our South East London estate agents team now and learn more about how Madison Brook can help you achieve your goal.