How Much are Estate Agents' Fees for Selling a House?
Estate agents traditionally charge the vendor of a property a percentage of the final selling price. In addition to this, most auctioneers will charge an additional advertising fee and some charge “outlays”. Depending on the agent, advertising and outlays could add another €500 to the final bill.
In terms of the percentages charged, again these vary but industry standard would be in the region of 1.5% + VAT at 23%. So let’s suppose you are selling a property for €300,000, a typical bill from the auctioneer would be as follows:
| Selling Commission | (€300,000 X 1.5%) = €4500 |
| Advertising | €300 |
| Outlays | €200 |
| Total ex VAT | €5000 |
| VAT @ 23% | €1150 |
| Total Bill | €6150 |
Use our slider below to see the savings on offer from Auctioneera depending on the final selling price.
Such a massive differential in the prices charged by competitors isn’t normal. In the above example, our fee is €4552 less (74% less) than the regular price. Accordingly, the main question we get is “what’s the catch?” “this seems too good to be true!” “what aren’t you telling me?” “are you registered with PSRA?” etc. For the record, the answers are: there’s none, it’s actually not, nothing and yes!
So Why Are Estate Agency Fees So God Damn Expensive!
The current fee structure probably had some validity before the Internet. Pre-Internet, potential property buyers went from estate agent to estate agent looking at the properties that they had available in books with photographs. There was no Daft, no MyHome so no central database of all of the properties on offer in any given location. In this environment, things like a prominent shop front and a list of potential buyers had value. Selling property was slow, clunky and had high transaction costs. So charging a few thousand Euro (Punts at the time) could be justified as there was quite a lot of work and overhead involved in selling a property.
Alas, things have moved on, but the pricing structure hasn’t. Nowadays, the reality is that Daft and MyHome do the heavy lifting of selling a property by acting as central hubs where literally 100% of the market search for properties. There is absolutely no need at all whatsoever for an expensive high street presence.
The idea behind charging a percentage of the final selling price of the property is that this fee structure solves the “principal / agent” problem ie it aligns the goals of the seller and the auctioneer, which is to get the highest price possible. Implicit in this fee structure is that auctioneers won’t do their best for their clients unless they are financially incentivised to so do. That doesn’t reflect well on the profession at large. You don’t pay a doctor a higher fee depending on the outcome of their treatment; the fee is fixed and you trust their professional integrity that they will do the very best they can for you.
Another problem with the percentage of selling price structure is that it implies that an auctioneer can get a vendor a higher price for their property. Assuming an agent ensures the taking of high quality photography, lists the property on Daft / MyHome and shows the property to everyone who wants to see it, there is no further technique to drive the price higher. The agent sits in the middle, accepting offers and the highest offer is presented to the vendor at the end of the process. If the vendor is unhappy with the offer, the estate agent can relay this information to the buyer and advise that the property will not be sold for this amount. The buyer can agree to raise their offer or hold firm – the estate agent has absolutely no control over any of this. The property is valued by the market in the amount that the highest bidder is willing to pay. So in our view, agreeing to pay the estate agent a percentage of the final selling price in order to incentivise him/her to get you a higher price is utter insanity as the ultimate price achieved frankly has nothing to do with them. It is worth simply what the highest bidder is willing to pay.
Auctioneera’s Fees are a Fraction of Everyone Else’s – There Must be a Catch!
When selling something for several hundred thousand Euro, the last thing you want to do is to be penny wise and pound foolish. For example, saving a few Euro by selling yourself (and thereby not being on MyHome as only estate agents can list on there) or taking the photos on your phone is madness. You don’t want to save money on anything that will give you the absolute best possible chance of selling your property for the highest price. In order to do this, you need:
- Professional Photography and 2D Floor Plans
- A Well Written Description
- Daft & MyHome Listing
- For Sale Sign
- Regular Open & Private Viewings to Accommodate All Interested Parties
- A Qualified, Professional Auctioneer to Accept Offers Offline or Online as Per Buyer’s Preference
- An Auctioneer to “Negotiate” at the End of the Process if the Desired Price Hasn’t Been Achieved
Anything over and above the above list is frankly just waste. We get asked “do you advertise in the newspapers?” Some people like to see their property in the newspaper. The reality is that 100% of the market is on Daft & MyHome – if your property is on there, everyone interested in your property will see it. If a client insists, we will advertise in the papers and pass the cost along but we do so grudgingly as we have yet to see someone open up a Sunday newspaper, see an advert for a property and decide to pick one up – property doesn’t get bought like that. People conscientiously study all the options on Daft and/or MyHome and view their favourites within their budget. “Hunny if you’re going to Tesco later, would you mind picking up some charcoal for the barbecue as it’s on offer this weekend. You might pick up a 3 bed semi in Lucan also as I see a new estate has just been launched there” ..said no one ever! Buying property is not an impulse purchase and is not suited to display advertising. It is one of the most, if not the most, involved purchases of a person’s life so is heavily researched on Daft and MyHome.
So when you add up the cost of all the above tasks, if bought in bulk, they come to less than €1499 and hence our price of €1995+VAT. Our margins are tight for sure and we certainly don’t get very rich selling a handful of properties per week, as do the traditional competition. But we believe that one man’s margin is another man’s opportunity. While we make very little profit per property we sell, we believe we will ultimately control the entire market as more and more vendors vote with their wallets and decide to keep their hard-won equity. We will take a small profit from a large number of customers and not the other way around.
So the next question we get asked is “ok, you sell lots of property, does that mean your service is worse?” Talk is cheap so we point you to the genuine reviews of those who have sold with us to date.
We recently sold our family home through Auctioneera recently. Fiona and her team provided a very seamless and professional service.
As a first time buyer in Ireland, I am so happy working with Auctioneera. Auctioneera was incredible and gbe team was very helpful and supportive.
Great house for sale auctioneering & estate agency service from start to finish by Auctioneera & their representative Lee Walsh. Their online IT softw... read more
I sold a property recently in Cork. I found Auctioneera very efficient. The house was in a good location so had a lot of interest. The fixed fee was g... read more
Couldn't be happier with the team at Auctioneera. Very professional from the offset and supportive throughout the entire process. This coupled with th... read more
I dealt with Victor throughout the purchase of the property and he was truly a great help through this whole process. I did find the Cork based estate... read more
Auctioneera were the agents I dealt with when purchasing my home. I found their honest, open and direct approach refreshing and their way of selling m... read more
Robert and all the team at Auctioneera were brilliant to deal with and the best estate agent we have dealt with. Coudn't recommend more.
We recently sold our apartment through Auctioneera, and from the moment we met Robert, we knew we were in good hands. They saved us a small fortune co... read more
Overall very positive experience. I would highly recommend Auctioneera team to everyone.
Friendly staff member and quick to reply to all inquiries it ... read more
On the contrary, like medical centres of excellence, we believe that because of the amount of property we sell on a daily basis, we become absolutely totally attuned to the very latest market developments. We live and breathe property everyday so we know the market intimately. Above all else, when we get engaged to sell a property, we want to create a happy client and so we are meticulous about customer service. So before you agree to pay over the odds to sell your property, speak to us.