 Do you really need an estate agent? In the first of a fourpart series, You & Your Money investigates the pros and cons of buying or selling your home without the middleman.
Until recently, selling privately was
slow to catch on in Ireland, but
more and more homeowners are
going it alone as estate agent fees climb.
It's not a new trend either: In America,
between 20% and 30% of
properties are 'For Sale by Owner', a
practice also common in the UK.
Estate agents in Ireland charge an
average commission of 1.5% to
sell property. VAT at 23% is then
added to this commission. This means
that, on a house valued at s350,000, you
can save over €6,000 by selling direct.
For a house valued at €550,000, the
saving rises to almost €10,000. In a
market where prices continue to decline,
many property owners are cutting out
the estate agent and using this
substantial saving to get a better deal for
both themselves and property buyers.
While there are several advantages to
selling property privately, the cost
savings involved, which property owners
can use to offer a more attractive price
to buyers while still netting more in the
final deal, are huge attractions.
However, a recent survey conducted
by Sellityourself.ie reveals that the main
incentive for people selling direct is to
gain more control over the selling
process. "What we found is that many
property owners are disillusioned with
their estate agent and want to be more
proactive in the sale of their property,”
says Anne-Marie Doyle, founder of
Sellityourself.ie. |
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For Ken, currently selling a property in
Cork, taking over the sale from his estate
agent has been the right step: “In 2007,
my agent showed the property to fi ve
people. Since taking control of the sale, I
have showed it to nine people in the past
three weeks and have received many
enquiries. I see little point in involving an
agent. I have bought many properties
myself over the years and am yet to
meet an agent who 'sold' me the
property.” |
"While there are several
advantages to selling
property privately, the cost
savings involved, which
property owners can use to
offer a more attractive price
to buyers while still netting
more in the final deal, are
huge attractions." 
Property owners selling direct know
the exact number of buyers viewing
their property online. They also know
the precise number of phone and email
enquiries they are receiving and they
can speak directly to the buyers to
gauge their level of interest. If interest is
low, they can take measures to increase
it - whether through readjusting the
price or through advertising. With an
estate agent, you're relying on their
feedback. In some cases, this feedback
may not be entirely accurate, as the
agent has their own reputation to protect.
"Sale by Owner" websites such as
Sellityourself.ie provide property sellers
with a complete selling package -
everything from the online property
listing, 'For Sale' signboard, pointer
board and a newspaper advertising
service. What's more, the €150 fee on
sellityourself.ie is a one-time fee and
your property is listed on the site until
it's sold. The property seller simply
shows their house to potential buyers
and handles the price negotiations
before handing the sale over to a
solicitor for closing.
"I have bought many
properties myself over
the years and am yet to
meet an agent who
'sold' me the property
"
| If this is all very straightforward, why
aren’t more people not selling privately?
Showing potential buyers around a
property puts many people off selling on
their own, so they choose to use an
estate agent. They may feel daunted by
the process, or simply don't have the
time to devote to it. In most cases,
though, a property owner has an
advantage when showing their house, as
they have expert knowledge of the
property. The owner can provide full
details on every aspect of the property,
the neighbourhood, and facilities in the
area where an estate agent might not,
and this information is extremely
important to anyone buying a home. |
|
Maria, currently selling a four bedroom
property in Celbridge, Co.
Kildare, is very comfortable showing
people around her home. “With a young
family I can schedule viewing times to
suit me, and I can answer any questions
potential clients ask. I just feel in
control”, she says. “When I viewed
houses in the past, some estate agents
couldn’t even answer simple questions
like why the people were selling,” she
adds. From the buyers’ perspective, Ken
finds that “buyers are happier to ask
more questions and have not been
negative in any way regarding not
having an agent involved – in fact, they
seem to welcome it.” |
Contrary to popular belief, an estate
agent isn't essential when selling a
property as they don't have a part to
play in the legal process. When selling
privately, you can retain the services of a
solicitor and pass the closing of the sale
on to them once a buyer has been
found.
Your Questions
Q As a buyer, should I be wary of
buying a house directly from a
property owner?
A Absolutely not!
When buying a
home directly from the property
owner, all you have to do is employ a
surveyor and a solicitor, exactly as
you would if you had found the
property through an estate agent.
Although the legal and survey fees
will increase the purchase costs, these
amounts are relatively small compared
to the expense of trying to sort out
unexpected diffi culties in the future. A
qualified surveyor will survey the
property and identify problems that
you may have overlooked. If problems
are identifi ed, you may be able you to
renegotiate the price with the seller,
thus preventing any costly fi nancial
implications further down the line.
A solicitor is necessary to deal with
the 'conveyancing' - transferring the
ownership of property from one
owner to another. The solicitor will
ensure that all aspects of the purchase,
including planning permission and
other legal requirements, are
satisfactory and will investigate the
property as thoroughly as possible to
uncover any issues. The solicitor will
also liaise with your bank, building
society or mortgage broker with
regard to the issue of loan cheques.
Many property buyers forget that the
estate agent is acting on behalf of the
seller. So purchasing property directly
from the owner has many advantages.
You get fi rst-hand knowledge of the
property and the area, a better
indication of the level of interest in the
property, and a good idea of how
seriously the owners are taking your
offer. Finally, you may be able to
negotiate a better deal by taking
advantage of the cost savings being
made by the seller. With your solicitor
and surveyor on board to protect your
interests, you can be confi dent that the
purchase of your property will be just
as smooth without the middleman.
Q Legally, do I need an estate
agent to sell my property
A
There is a common misconception
that estate agents are always
necessary to sell a property, and that
they have some legal involvement in
the property sale. However this is not
the case. The estate agent plays no
part in the legal process of selling
your property: their primary function
is to advertise your property and
locate a buyer. Your solicitor continues
to manage all the legal aspects of the
property sale.
Once you have found a buyer for
your property and have agreed on a
price yourself, you will instruct your
solicitor to close the sale just as if an
estate agent had found the buyer for
you. Your solicitor will liaise directly
with the buyer's solicitor to ensure a
smooth property sale and transfer of
title.
Sellityourself.ie offers all the
services of an agent without charging
commission, while the property owner
deals directly with the potential
buyers. These services include an
online property listing, 'For Sale'
board, pointer board, virtual tours,
professional house photography,
brochure printing and newspaper
advertising. The website also
provides a directory of property
solicitors to make selling it yourself
even easier.
Q I am already with an estate
agent. Can I still sell my home
privately?
A
If you're selling with an estate agent,
you may also sell your property
yourself, as long as you have not
assigned 'sole selling rights' to your
agent.
Before selling on their own, many
people will cancel the contract that
they currently have with their agent.
However, others may wish to continue
with their agent while exploring the
SIY (Sell It Yourself) option. If so, you
need to check to see what type of
agreement you have with your agent.
The most common agreement is
sole agency. This means your estate
agent is the only 'agent' allowed to sell
your property. This contract does not
prevent you from selling your property
yourself through Sellityourself.ie and, if
you fi nd the buyer, then you don't
have to pay any commission to your
estate agent.
However, if you have assigned 'sole
selling rights' to your agent, then you'll
be liable to pay them commission,
even if you fi nd the buyer yourself.
Sellityourself.ie recommends that you
let your agent know if you are selling
your property direct. They will let you
know exactly where you stand, and
you may even be surprised at how
interested your estate agent suddenly
becomes in your property!
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