How much do estate agents charge?
Can I sell my house without an estate agent?
You’re legally allowed to sell your house without an estate agent. You’ll avoid paying estate agent fees, but you will have to take care of pricing, advertising, and negotiating a house sale by yourself. You also might not be able to get the best price for your house as you probably won’t be able to advertise on the big online property portals.
If you’re thinking of buying or selling a house yourself, you can check out our blog ‘Do you need a solicitor to buy a house?’
What do estate agents fees include?
The services that an estate agent’s fees cover can vary, so it’s best to ask an agent before you sign anything. And online agents that offer cheaper services may charge extra for some services.
You can generally expect an estate agent’s fees to cover these services:
- Valuation of your property
- Writing a description of the property
- Drawing up floor plans
- Photographing your home
- Putting up a ‘For Sale’ sign
- Contacting potential buyers
- Marketing the property
- Organising viewings
- Negotiating a sale price
How much do estate agents charge in the UK?
Estate agent fees in the UK can vary quite a lot, often anywhere from 0.9%-3.6% of the total sale price of the property. On average, estate agent fees in 2023 are 1.42%, including VAT.
Some estate agents might offer a sliding scale of commission, which would give them a higher commission percentage if they sell the property at a higher price. For example, if your home is valued at about £300,000, this could look like:
- 1% if they sell your home for under £275,000
- 1.25% if they sell it between £275,000 and £299,999
- 1.5% if they sell it between £300,000 and £325,000
- 1.75% if they sell it for over £325,000
This can be effective if you find an estate agent with a strong track record of selling houses over their initial asking price. You may end up paying higher estate agent fees, but you could sell your house at a higher price.
If you’re not sure how much your house is worth, you can check out our blog ‘What is the value of my house?’
How much is VAT on estate agent fees in the UK?
VAT on house sales in the UK is 20% of the total sale price of the property. This means that a 1.2% fee would be 1.4% including VAT. Estate agents have to clearly state whether their quoted costs include VAT, so it’s best to ask if you’re not sure.
Hidden estate agent costs to look out for
There are a few things to watch out for when you’re working with estate agents to make sure that you aren’t going to be surprised by any extra costs:
- Estate agents must disclose what their fees cover - You can ask your estate agent to provide a full list of their services to make sure you won’t pay for ‘extra’ services like photos and floor plans.
- ‘Withdrawal fees’ - Estate agents can charge you a fee if you decide you don’t want to sell your house anymore, but this should be clearly written in papers you sign
- Recommended services - You don’t have to accept any recommended services from your estate agent, like surveyors or conveyancers.
- Energy Performance Certificate (EPC) - You need to have an EPC before you can sell a house, and it typically costs £60-£120 to get one. Though EPCs are valid for 10 years, so it’s worth checking if you think already have one.
- Quoted fees must include VAT - Commission percentages quoted by an estate agent are legally required to include VAT, so it’s best to ensure everything’s included before you agree to a final amount.
- Notice periods - If you decide to end your contract with your estate agent, you’ll usually have to wait a certain notice period, usually 2 weeks.
- Tie-in periods - This is the minimum amount of time that you’re tied into your contract with your estate agent. They can vary from 4 to 12 weeks, and you might have to pay a fee if you cancel your contract while you’re still in your tie-in period.
It’s typically recommended to use estate agents that use a ‘no sale, no fee’ policy. It’s the policy most standard estate agents use and means you’ll only have to pay them if they sell your house.
Can I negotiate estate agent fees?
You can negotiate estate agent fees, and it’s often a good idea to try to. Most estate agents will initially pitch you their standard rate of commission, which you can then negotiate down to a percentage you’re happy with. It’s generally agreed that 1.2% (without VAT) is a good place to aim for.
Here are a few things to remember about negotiating estate agent fees:
- Small, local, estate agents can be more flexible compared to large chains, which often have stricter policies
- Estate agents that are new to an area might be more open to negotiation to establish market share and make sales
- More expensive agents often have better selling records, so you might pay more but you can sell your house faster
Sole agency vs multi-agency fees
Multi-agency sales use two or more estate agents. They will compete with each other to sell your house, and whoever completes the sale takes the commission. This means your house is likely to get sold faster, and often for a higher price. Generally, this is a process used by property developers looking to make money quickly on strong properties. Multi-agency fees tend to be higher than sole agency fees, coming in at an average of 3%-3.6%, plus VAT.
When do I pay my estate agent?
Your estate agent fees usually are due once contracts are exchanged, right at the end of the sales process. You’ll then pay them once the sale is complete, and the money is in your bank (if you went with a ‘no sale, no fee’ agent). In most cases, your estate agent will invoice your conveyancing solicitor, who’ll take care of actually paying them.
If you’re wondering how much solicitors charge, you can check out our blog ‘How much are solicitors fees when buying a house?’
A few final tips…
These are the main things to remember about estate agent fees in the UK:
- The commission rate for estate agents can vary quite a lot, but it’s generally recommended to try to pay around 1.2%, plus VAT
- VAT on estate agent fees is 20%, so a 1.2% fee will cost you 1.4% of the total sale price
- It’s usually best to find an estate agent that offers a ‘no sale, no fee’ policy, to avoid paying any extra hidden costs
Urban Jungle is not a financial advisor and information in this article should not be taken as advice or recommendation.