Estate agent fees

[Mike Reed]

but it may be cheaper in the long term just to keep them afloat and regulate them more rigidly.

Well, yes, as the government repay up to £85K of each person's investment. The Icelandic bank fiasco comes to mind, though Iceland did eventually repay our government (my sister was caught out in this but got her money back within a week or two)

Compared to the banking crisis time, there are a heck of a lot more challenger banks than then, nearly all covered by the FSCS . Could they founder? Well, if they're making money at these interest rates, they're only likely to do better when rates rise. There are a lot of them though. A contrary situation to the fledgling energy companies, methinks.

 

[russel]

These pearls of wisdom are lost on me; partly by relevance and partly by comprehension of syntax, I'm afraid.

Because the dawn of neoliberalism brought forth lack of regulation in finance which made them incredibly rich and with that wealth they lobbied to reduce restrictions on lobbying and political donations so the whole system has become ever more corrupt and there seems no end in sight. Clear enough?

 

[Brian Ellis]

Recently paid 1% ex VAT which was the lowest I could negotiate with the agent I used. There were cheaper but this one produced amazing pictures, quality brochures and worked to sell our house which he did quickly and remained with us
throughout helping along the way. A lot of money but on reflection was worth it..

 

[Barrymagrec]

Recently paid 1% ex VAT which was the lowest I could negotiate with the agent I used. There were cheaper but this one produced amazing pictures, quality brochures and worked to sell our house which he did quickly and remained with us
throughout helping along the way. A lot of money but on reflection was worth it..

Yes, if you get a quality service it`s worth paying for, selling a house is bad enough without incompetent / don`t care agents making it worse.

 

[sean99]

Over here in the US 5% is common, which is pretty eye-watering if your house is valued near $1 million (which is a pretty ordinary house, but in a good location). I'm amazed they continue to get away with it. Moving house costs around $50k after all fees, so usually it's better to stay put, and maybe get the builders in.

 

[Ponty]

Over here in the US 5% is common, which is pretty eye-watering if your house is valued near $1 million (which is a pretty ordinary house, but in a good location). I'm amazed they continue to get away with it. Moving house costs around $50k after all fees, so usually it's better to stay put, and maybe get the builders in.

That seems crazy money. Unless it’s run by a cartel, surely there must be new market entrants who can seriously undercut that sort of pricing? Or market and sell directly? Of course, in the UK we have stamp duty, which could easily be £50K on a seemingly normal house in the south east.

 

[Bob McC]

That seems crazy money. Unless it’s run by a cartel, surely there must be new market entrants who can seriously undercut that sort of pricing? Or market and sell directly? Of course, in the UK we have stamp duty, which could easily be £50K on a seemingly normal house in the south east.

CGT is charged on all property in the US, including principle private residences, admittedly with reasonable thresholds.

 

[Ponty]

CGT is charged on all property in the US, including principle private residences, admittedly with reasonable thresholds.

Ah yes, good point. I suppose with the US system you are taxed at the point of sale of a material gain actually being made. In the UK, you have to fork out a chunk of cash (post tax) up front.

 

[sean99]

CGT is charged on all property in the US, including principle private residences, admittedly with reasonable thresholds.

The threshold is a $500k capital gain for a married couple selling their primary residence. Even with the current bubble not many fall into this, unless you've lived in your house for a long time. If you're retired on a low income you can also be exempt.

 

[Bob McC]

I thought you said $1 million was a pretty ordinary house in a good location?

 

[hifinutt]

and only 4 weeks to pay the cgt tax bill after you have sold . any delay and they slam you with a fine very fast !!!

 

[Mike Reed]

and only 4 weeks to pay the cgt tax bill after you have sold

Slightly better;30 days but what on Earth were they thinking about with such a short deadline? After my recent sale, I still hadn't had all the details back. However, they made it impossible for my wife and I, separately, to register online. Answer 2/3 qu.; passport (no) N.I. driving licence (I'm U.K. but no good; wife doesn't drive. Luckily I'm always wary of online experiments and had paper forms sent months ago. Glad I did or I'd've been up the Swannee.

 

[TheDecameron]

CGT is charged on all property in the US, including principle private residences, admittedly with reasonable thresholds.

I think it’s only a matter of time before that happens here. The buyer is already hit with eye watering LBTT/‘stamp duty’ with a low threshold for the 10% rate in inflated markets like Edinburgh, so Im sure like auctioneers, they’ll hit the seller too eventually.

 

[PsB]

Transaction costs in France:
- Stamp duties, notary's fees etc.: around 7% (varies slightly by region)
- Real estate agent: around 5% (if used, a lot of transactions are private)
To put it another way, you can rent a house for 3 to 4 years and still spend less than the transaction costs to acquire the same house.

 

[Mike Reed]

To put it another way, you can rent a house for 3 to 4 years and still spend less than the transaction costs to acquire the same house.

An unusual but interesting scenario. When my wife and I were seriously investigating southern French rural prop's in the first decade of this millennium (as were many others because of the 'bargain' prices), we were informed more than once that the overall admin etc. cost of purchase approximated 10%. Not sure that would include est. ag's fees as here, they are borne by the seller only.

 

[PsB]

An unusual but interesting scenario. When my wife and I were seriously investigating southern French rural prop's in the first decade of this millennium (as were many others because of the 'bargain' prices), we were informed more than once that the overall admin etc. cost of purchase approximated 10%. Not sure that would include est. ag's fees as here, they are borne by the seller only.

The transaction costs have come down a little bit I believe since then.

Even if the seller writes the cheque, the fee is baked in somewhere in that selling price... It actually makes sense for the buyer to pay the agent directly, to avoid paying duty on the agent's fees.

 

[Ponty]

Well, offer accepted on a place. It’s very, very painful trying to buy in this market. Forget about it unless you are truly proceedable, agents just won’t let people view. Far too much cheap borrowed money sloshing around and they want to relax lending criteria further…

 

[hifinutt]

Yes it just does not seem to end, has been like that for 7 years now in parts of west Midlands

 

[dan m]

Not that I agree with the hefty fees in the US, but part of it is there’s both a buyer’s and seller’s agent involved. I find it odd the buyer in the UK has to fully understand the local market when putting in an offer (or risk overpaying). As a first time home buyer it was good to have someone with experience when negotiating price. I have seen fixed fee services in the UK that help with searches and provide advice on value. But I don’t think they are typically used.

How do most determine what to put in? I think that comps are hard given the diversity of housing. I can’t believe folks trust the seller has priced something fairly.

Also, if the seller’s agent is working for a flat fee what’s the motivation for getting the seller the highest price? The opposite is true - lowball it and get a quick sale, and move on to the next property.

 

[TheDecameron]

A formal valuation will approximate to what the current market value is. In Scotland the seller is obliged to pay a chartered surveyor to value the property and supply the ‘home report’ to interested parties.

I also just noticed CGT is owing on the sale of your primary home if you’ve lived in it less than two years while owning it longer as a second home and is payable within 60 days of sale!