Homeowners pay £3bn of estate agent fees in 2013

UK homeowners paid out more than £3bn in high street estate agent fees during 2013, with London homeowners alone paying agents almost £1bn, according to research carried out by online estate agents Housesimple.

Related topics:  Finance News
Amy Loddington
3rd June 2014
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According to HM Revenue and Customs, the total number of properties sold in the UK during 2013 was 1,071,220. And using average house price figures from the Nationwide House Price Index, the average price of a UK property sold in 2013 was £169,043.
 
Housesimple.co.uk has calculated that taking 1.75% as the average percentage-fee charged by estate agents on a house sale, that the total amount of fees paid out by UK homeowners to high street estate agents during 2013 was a staggering £3.2bn.
 
Not surprisingly, London tops the estate agent fees chart. With the average price of a London property in 2013 standing at £325,414 and the total number of properties sold during 2013 just under 88,000, the total amount of percentage-based fees paid to London estate agents was almost £600m. That was more than 12 times the total amount of agent fees paid by home sellers in Bristol (£49m).
 
There were seven cities in the UK where estate agent fees paid during 2013 topped more than £20m; London (£599m), Bristol (£49m), Manchester (£32m), Liverpool (£28m), Birmingham (£27m), Nottingham (£23m) and Leeds (£22m).
 
With traditional estate agents charging thousands of pounds in fees, more and more homeowners are now turning to online estate agents to sell their property and saving thousands of pounds in fees in the process. Online estate agents charge a fraction of the cost of high street agents for an identical service from valuation to completion; providing professional valuations, photos and floorplans, through to managing viewings and negotiating with buyers on behalf of the seller.
 
According to Housesimple.co.uk, if the 1,071,220 properties sold in 2013 were sold through an online estate agent, sellers could save around £2.6bn in fees[5]. Homeowners who sell through Housesimple.co.uk, save on average £5,207 in fees compared to selling through a high street agent.

Alex Gosling, managing director of Housesimple.co.uk, comments:
 
“These figures are staggering. Homeowners lined estate agents’ pockets to the tune of £3bn last year, and in London particularly, where properties in many areas are selling themselves, there is no need to be paying such high fees to sell a property.
 
“Despite the fact that the majority of property searches now start on property portals such as Rightmove and Zoopla, homeowners are still paying through the nose to sell through traditional estate agents.
 
“The days where buyers needed to walk into an estate agent’s office to book viewings are long gone. The whole property transaction process from valuation to completion can now be facilitated online at a fraction of the cost of using a traditional agent.
 
“Currently less than 1% of homeowners use an online estate agent, even though the service is almost identical to a traditional agent. And if every homeowner who sold a property in 2013 had used an online estate agent, they could have collectively saved more than £2.6bn in fees.
 
“Clearly not every homeowner will sell online, but the fact is that there is now a genuine alternative to selling through a high street agent.”

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