Agents say so little on their particulars
Written by Viewber co-founder, Ed Mead:
Why do so many put minimal info up front and what are Trading Standards possibly doing about it?
More often than not the lack of up-front info is simply because agents want potential buyers to pick up the phone. They can then qualify them and offer them an assortment of related services. This has all been put under the microscope by Trading Standard’s comment at the start of October that buying customers must be told about any potential referral fees. Agents may face disqualification if they don’t.
Most buyers would welcome as much info as possible about a property upfront and must find it very annoying when all they are offered on the actual listing is the words leasehold or freehold. In the days when auction style data rooms like the PIP Vault are available at no cost, it would seem unforgiveable not to have much more available upfront.
Some agents, usually the bigger ones, are very good at selling related services to buyers – indeed recent Countrywide figures suggest that for every £1 they make from agency commissions they make more than 40p from third parties. Smaller agencies will often not make any play for this income at all, but recent changes like the tenant fee ban mean that is likely to change as all agents seek additional income streams in order to thrive.
So is the idea that your agent will refer you to a local solicitor, mortgage company or removals services, for example, such a bad thing. Does the fact that they’ll make money for doing so bother you.
Therein lies the dichotomy, you may not like the idea of an agent trying to pass you on to someone else or making money out of you but ask yourself – what advantage does that agent have by recommending a duff service. Almost all these recommended services only pay out on success. In my time as an agent I built up a formidable set of contacts in almost every sector and although back then you didn’t take money, an invitation to Wimbledon or lunch in a nice restaurant was the oil that smoothed the wheels.
Indeed, chances are that estate agents will be recommending someone who genuinely knows what they’re doing, will have sieved out the duffers over a period of time and will help get your deal done.
The key for anyone looking to use referral services is transparency and it’s this that Trading Standards are looking out for. The amalgamation of many service providers means some of the legal services you might be offered could be located anywhere in the country and standards can vary wildly. The ability to actually go and visit in person is often lost – but this is the case with so many providers these days when trying to lower the cost of service.
The idea of making money from a buyer could be viewed as anathema to many, bearing in mind an agent is paid by, and could be viewed as acting exclusively for, the seller. To be potentially making so much money from both sides is a relatively new phenomenon, but when each property can yield as many as twenty potential buying leads it’s a big untapped resource. There’s even a move to sell for free and monetise only buyers – if you view making money out of both sides questionable then it’s arguably a better way of looking at the process.
Point I’m making is that not all referral fees are a bad thing – keeping them hidden is.