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The REAL Cost of Selling a House in 2020: Estate Agents, Auctions and Cash Buyers
The cost to sell a house depends on which method of selling you choose and a number of other different factors. In this article we will look at each of the different methods and at approximately how much will it cost to sell a house using each of them.
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How Much Does it Cost to Sell a House With a Commission-Based Estate Agent?
Selling your house by charging a commission on its eventual selling price is the method which has long been used by estate agents. It’s still the main method used by most conventional or high street estate agents.
The cost of selling a house using a commission based estate agent will depend on a number of factors. These include: The area, the individual agent, the type and value of your property, how keen the agent is to take on selling your house, and even how easy or difficult they think it will be to sell.
How much are estate agent fees? Estate agent’s commission varies from agent to agent but can be as little as 0.5% or as much as 3% or more of the eventual selling price of a property, plus VAT.
A survey by The Advisory found that in England and Wales the current average high street agency fee is 1.18% plus VAT for a sole agency agreement on a no sale, no fee basis.
Research by GetAgent for Which? Money says that quoted fees range between 0.85% and 3.07% although the average estate agency commission is 1.53%.
To find out how much it will cost to sell your house you will need to ask a number of agents for a quote of their selling costs.
Most estate agents have a slightly lower commission rate if you give them sole agency rights to sell your property. Some estate agents are willing to negotiate on their standard commission rate. Some agents may agree a commission rate on a sliding scale. That is, they will earn a higher commission if they are able to sell your house for a higher price than anticipated.
When selling a house using a commission based estate agent check if there are any other fees on top of the commission. For example, fees for a for sale board, enhanced marketing or conducting viewings. In most cases, estate agents who charge a commission will include these in the commission.
Commission based estate agents usually work on a no sale, no fee basis. That is they only charge their commission if they find a buyer for your house.
Bear in mind the percentage of commission charged does not necessarily relate to the service you will receive. Estate agents who charge low commission may be better for selling your particular house than estate agents who charge high commission and vice versa.
How Much Does it Cost to Sell a House With a Fixed-Fee Estate Agent?
Some estate agents charge a fixed fee rather than a commission to sell a house. This is the method usually used by the newer online or hybrid estate agents – the ones who don’t have high street offices. There are, however, some high street estate agents who offer fixed fee property selling and some online agents who charge commission.
Fixed fee estate agents usually offer just a basic selling service for the fixed fee. There are likely to be extra charges for optional services such as for sale boards, conducting viewings and for enhanced marketing services. Fixed fee estate agents often charge the fixed fee whether they sell your house or not.
Money Saving Expert says that online estate agents charge anything between £99 and £1,695.
A survey by The Advisory found that the average fee charged by online or hybrid estate agents is £875 plus VAT.
It is worth bearing in mind that whether a fixed fee agent is cheaper or not depends on the sale price of the property amongst other things. In the case of cheaper properties selling a house can cost less by paying a commission rather than a fixed fee.
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How Much Does it Cost to Sell a House Without an Estate Agent?
It’s possible to sell your house yourself if you want to, and so avoid estate agent’s commission or fees entirely. You could do this by placing a for sale sign on your house, placing ads. in local newspapers and house sales sites or even by using social media.
It is difficult to say how much does it cost to sell a house by this method. You would probably need to allow several hundred pounds for advertising but could save several thousand in estate agent’s fees or commission.
How Much Does it Cost to Sell a House by Auction?
Another option to consider when looking at how much does it cost to sell a house is the cost of selling a house at a property auction. This may be suitable depending on the property being sold, how quickly you want to sell and if you need a guaranteed sale.
Property auction houses may charge either a commission or fixed fee depending on the auction house. There may be some other fees to pay, including towards the cost of a legal pack, depending on the auction house involved.
Home Owners Alliance suggests you should expect to pay around a 2.5% commission for selling a property at auction.
How Much Does it Cost to Sell a House to a Cash Buyer?
One more option to consider when looking at the cost of selling a house is selling directly to a cash buyer. With this method, there will be no estate agent’s fees or commission to pay. Bear in mind though that the cash buyer may offer a price that allows for their expenses in buying the property.
Other Costs
Other than an estate agent’s commission or fees there are some other costs you need to consider when working out the cost of selling a house:
An EPC or Energy Performance Certificate is a legal requirement when selling a house. You will need to have one prepared unless your house has been sold within the last 10 years and you already have an EPC.
The typical cost of an EPC is around £60-£120. An estate agent can usually arrange an EPC for you or you can arrange one yourself with an EPC company.
If you’re selling a house in Scotland you’ll need to have a Home Report prepared before you can market your property. Home Reports include a single survey, an energy report (similar to an EPC) and a property questionnaire. These can cost in the region of £400-£800.
You’ll also need to consider the seller’s legal costs or conveyancing costs you’ll need to pay. You should ask solicitors or conveyancers for a quote but costs are likely to be around £500-£1,500.
The answer to the question of how much does it cost to sell a house is that there is no single answer! The best approach is to decide which method of selling you think will work best for you and then obtain several quotes or estimates of the cost before selling your house.
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