Why Are Estate Agent Fees So Damn Expensive (And What’s The Alternative)?

Estate agent clown

Spoiler alert: there are cheaper solutions that don’t suck!

But yes, for sure, our traditional high street estate agents are generally painfully expensive!

With UK house prices climbing and with typical UK high street estate agents charging anywhere between 0.75% – 3% commission on the sale price, it’s not unsurprising that many home-sellers are reduced to blubbering tears when they’re handed the bill.

According to the UK House Price Index (September 2021 edition), the average UK house price was at a record high of £270,000.

Know what that means?

You could pay between £2,025 and £8,100 + VAT in commission to your local estate agent for flogging your property. Yes, OUCHIE! That is absolutely gut-wrenching!

But you know what really gets on my tits about the out-dated and cut-throat commission based pricing model? Well, it’s the out-dated and cut-throat commission based pricing model.

To be specific, it’s the fact that the price we pay has NO reflection on the amount of work that has gone into the sale, but rather, it’s purely based on the value of the property, so some of us are paying a lot more for the same level of service.

Fortunately, we’re no longer living in the Stone Age; we’re not barbarians sleeping on rocks! Times have changed, and home-sellers now have options better fitting for modern and fairer times!

So in short, why are estate agents so damn expensive?

I think it boils down to, “because they can”

Honestly, I really think that’s it.

It’s a bleak outlook, but one that I’m sure isn’t unbelievable.

When an entire industry bands together and embraces the same pricing model, it’s very hard to combat, even if it’s unfair and makes little sense. I’m not saying estate agents don’t provide value, nor would I refrain from acknowledging the exuberant overheads they have to cover (wrapped Mini Coopers certainly don’t pay for themselves), but there does seem to be a real issue when two people that receive exactly the same service end up with a bill that is thousands of pounds apart.

Welcome to 2021: Fixed-fee Online Estate Agents

Is a fixed-fee pricing model the fair solution? I think so. Or at the very least, it’s a fairer one. And I’m certainly not alone, hence why ‘online’ and ‘hybrid’ estate agents like Purplebricks & Yopa have changed the [house-selling] game and have become ridiculously popular with sellers’ over the last several years due to their low-cost fixed fees. Essentially, it doesn’t matter how much you’re selling your house for, everyone coughs up the same price. That sounds exactly like how it should be, right?

Fixed-fee online estate agents make it possible for you to sell your home for £500 (the average cost of an online agent), while the average high-street estate agent charges anywhere between 0.75% – 3% of the sale price, which based on the average house price in September 2021 of £270,000 would cost between £2,025 – £8,100 + VAT.

Now, I’m not going to tell you that an online agent like Purplebricks is a like-for-like replacement for a traditional high street agent, because they’re not. There are differences – there has to be trade-offs to pull off the low prices – but what I will say is that online agents have made it incredibly easy and cost-effective to sell a home. Of course, you should be aware of the key differences between Online Estate Agent Vs High Street, so you can decide which option is the best for you. To find out more, you can scour through my…

I know I’ve primarily used Purplebricks as an example of an online agent, so I wouldn’t be surprised if there’s a handful of people screaming at the screen, “what about [insert a different fixed-fee online agent]?”

I hear you loud and clear, and I’m getting to that.

Purplebricks is the most popular online estate agent (technically, they’re a ‘hybrid’ agent, but tomayto, tomahto!), so it’s a brand most people are familiar with, and that’s the only reason I’m flaunting them around. In reality, there are dozens of other reputable online estate agents offering similar services, some of which are higher rated and significantly cheaper.

The average fixed-fee Online Estate Agents charges £500

The likes of Purplebricks and Yopa are actually the most expensive examples of online estate agents today. The average cost is approx. £500, and the cheapest service is currently provided by an online agent called Strike (formerly Housesimple). They charge – wait for itabsolutely nothing! I shit you not, their service is absolutely free. It’s legit, and I go into more detail about Strike’s free house-selling service right here.

Anyway, I’ve waffled on too much, here are some visuals that will better tell the story…

Examples of Fixed Fee Online Estate Agents
Estate AgentRatingDurationIncludes / NotesPrice
Rating
4.7
TrustPilot Reviews
Duration
6 months
Includes / Notes

No fee package
  • Key features
  • Rightmove listing
  • Zoopla listing
  • Photograghs
  • Floorplan
  • Negotiation
  • For sale sign
  • In-person valuation
  • No sale, no fee
  • 13 weeks Sole Agency contract

*YES, Strike will give you a 100% free service, no strings attached.

However, Strike currently only sells properties in England, and in two forms. They provide a "hybrid" service (i.e. which includes an in-person valuation by a local agent) for properties in the Midlands, North West & Yorkshire etc. Specifically, the following postcodes: B1 - 50, B6 - 99, BB, BD, BL, CA, CH1- 4, CH25 - 34, CH41 - 49, CH60 - 66, CH70, CH88, CH99, CV, CW, DE, DG, DH, DL, DN, DY, FY, GL1 - 20, GL50 - 56, HD, HG, HR, HU, HX, IM, L, LA, LE1-19, LE21, LE41, LE55, LE65 - 67, LE87, LE94 - 95, LN, LS, M, NE, NG1 - 25, NG31 - 34, NG80, NG90, OL, PE10 - 12, PE20 - 25, PR, S, SK, SR, ST1 - 21, ST55, SY, TD, TF, TS, WA, WF, WN, WR, WS, WV, YO.



For the rest of England, they provide a "virtual" service, which includes everything listed, but instead of an in-person valuation, you will receive a digital valuation report.

Price

Free

*Free

Visit WebsiteBook Free In-Person Valuation
Rating
4.9
TrustPilot Reviews
Duration
12 months
Includes / Notes

Pay Upfront package
  • Key features
  • Rightmove listing
  • OnTheMarket listing
  • Rightmove Premium listing
  • Photograghs
  • Floorplan
  • 30 day money-back guarantee

* Add Rightmove premium listing to your cart then apply discount code during checkout.

Price

Promo running

£595 Inc VAT
(Normal price: £625)

Visit Website*Free Rightmove Premium Listing with code: PREMIUM2020
Rating
4.5
TrustPilot Reviews
Duration
12 months
Includes / Notes

Pay now package
  • Key features
  • Rightmove listing
  • Zoopla listing
  • Photograghs
  • Floorplan
  • Negotiation
  • For sale sign
  • In-person valuation
  • Money-back guarantee

*Selling fee of £1,499 in London and surrounding areas.

Price*£999 Inc VAT Visit Website

Right, I’m done.

I’d love to hear your precious thoughts…

xoxo

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