How hiring an agent can make your search for a home easier
By Hannah Ricci
If only buying a house was as easy as on TV – you’d invite some property gurus round for a cup of tea, tell them what you’re after, and off they would go, coming back half an hour later with the perfect house at the perfect price. Property search agents claim to offer such ease, taking the legwork out of looking and the hassle out of haggling. They basically find you a fabulous property without you having to lift a finger.
While search agents are often viewed as an exclusive service for buyers at the higher end of the market, more and more house-hunters are turning to them for help. For the time-pushed, inexperienced, or those wishing to relocate, property search consultants or ‘homefinders’ promise to save you time and money, by providing a stress-free professional service.
First off the mark
So what can these professional house hunters offer, that you couldn’t do yourself? The process starts by meeting with a search agent – face to face or over the phone – to discuss your requirements; the areas you are interested in; your budget; and how flexible you are prepared to be. They will then arrange a schedule of viewings, and accompany you if you wish.
As consultants have so many contacts, they’re often the first to view properties – sometimes before they are advertised – and find out about those being sold privately, or discreetly by agents. And because estate agents, developers and private sellers know that only serious buyers hire brokers, they frequently offer first refusal.
The agent will do all the leg-work. Consultants’ expert knowledge of markets and localities also avoids wasting time looking in unsuitable areas. For example, they’ll look out for traffic problems, noise pollution and what the neighbourhood is like. Some property search consultants include all this in the service, whereas others charge extra.
If you have spotted a potential property yourself, you can also make use of the ‘property preview service’ offered by many companies. Usually for a fee, the agent will provide a detailed, unbiased report on the property, with photos. Again this is useful for people who are incredibly busy, and saves time for those who might travel miles to see a property that looks good on paper, but in reality could be a disappointment.
Smoothing the way
The majority of homebuyers who use search consultants, find a home they want to buy relatively quickly. Once they’ve found a property you like, your agent will start negotiating on your behalf. “Unlike homebuyers we don’t develop emotional attachment to properties, so are open to hard negotiation,” says Ayre. “Depending on the value of the properties we’re dealing with, we can save anything from £5,000 to £50,000.”
Once an offer has been accepted it doesn’t end there. On your instruction, search agents can contact solicitors to arrange contracts, and ensure everything goes smoothly through to legal exchange and completion. They can also help recommend mortgage and insurance brokers, architects and planning consultants as well as interior and garden designers, builders and removal companies. RSJ Property Search in Dorset offers a move-management service, where the firm collects the keys, opens up the property for the removal firm and looks after utility meter readings.
Such services certainly don’t come cheap, but the idea is that the savings you make on the purchase price should more than cover your costs. Initial registration fees for joining a property search service can start anywhere from £125 to £2,000 (see below for example costs). It’s important to read the small print to find out what this fee includes. Some companies, such as Francis Long Homesearch in London, offer everything inclusive of the registration fee, whereas many others charge extra for any addition services.
It’s also worth checking how long the registration fee covers you for. For some this lasts until the search agent finds you a property you want to buy, whereas others can last anywhere from two to six months, after which they will charge a retention fee which can cost as much as £250.
Then there’s commission. On purchasing a property, some homefinders use the initial registration fee as a deposit, which is deducted from the commission they charge, whereas with others it’s a non-refundable fee. Commission ranges from 1% to 2% of the final purchase price. The majority of brokers charge the greater of either this, or 15% to 25% of the difference between the original advertising price and the final purchase price.
When negotiating, most search consultants guarantee to make a saving of at least the fee they charge. So if you bought a property for £190,000 with an asking price of £205,000, the fee charged would be £2,250 (15% of the £15,000 saving) because it is greater than 1% of the final purchase price, (£1,900). In this case the saving is more than the fee, so the buyer would theoretically be £12,750 better off than if they had done it on their own, and paid the original asking price.
Market forces rule
However, in reality these savings may not be as great as property search firms would like you to believe. According to Hometrack, the average UK property is now selling at 7% below the asking price. Mark Newton, chief executive at Newton Fallowell Estate Agency points out: “Market forces dictate what someone will pay, so having someone to negotiate for you won’t necessarily make a difference.”
Brokers and their fees
Wilton Property Search wilton-property-search.co.uk Tel: 01228 529622
£375 plus 1% commission of purchase price or 15% of saving made between the original advertised price and final purchase price (whichever is greater)
Select Anglian Homes select-anglian-homes.co.uk Tel: 01473 716730
£300 plus 1% to 1.25% commission of purchase price less £300 deposit
Francis Long homesearch fl-homesearch.com Tel: 0207 5840809
£500 plus 1.5% commission of purchase price less £500 deposit
RSJ Property Search rsjpropertysearch.co.uk Tel: 01308 867877
£350 to £700 plus 1% commission of purchase price less deposit
County Homesearch county-homesearch.co.uk Tel: 0870 1123114
£500 (£750 in London) plus 1.5% of purchase price (1.75% in London) or 15% of difference between original price and purchase price
Surrey Homefinder surreyhomefinder.co.uk Tel 01372 806643
£450 plus 1.25% commission of purchase price less £450 deposit
Apex Relocation apexrelocation.co.uk Tel: 0845 634 7815
£400 plus 1.5% of final purchase or 15% of the difference between the advertised price and final price (whichever is greater) less £400 deposit
Select Homefinders selecthomefinders.co.uk Tel: 01539 564361
£500 to £1,000 plus 1% of purchase price or 25% of difference between original price and final price (whichever is greater)
E-Location e-location.co.uk Tel: 01539 564361
£275 to £425 plus £1,500 (less deposit) or 0.75% of purchase price (depending on property)
West Country Relocations westcountryrelocations.co.uk Tel: 01823 400066
£375 plus 1% of final purchase price
Editor's note: Please beware that this particular article is directed at people living in the United Kingdom. Always seek expert opinions before making key home-buying decisions.
With thanks to Interactive Investor where this piece first appeared
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