March 2007

'A decent fee for a decent selling experience — what is wrong with that?'

Sir,

IT amazes me that despite yet another estate agency company having gone into administration locally to us in recent weeks (a one per cent merchant), some of our competitors continue to sleepwalk into their own financial disaster by blatantly and unnecessarily ‘undercutting’ and ‘discounting’ their fees in a vain attempt to increase profitability or in some cases, just to stay in business at all, I suspect.

I have truly lost count of the agencies that have closed nearby subsequent to a campaign of adverts and leaflets that proclaim a false client value of ‘one per cent!’ commissions or even lower. When will you all learn??

I am far from advocating what would amount to an unlawful cartel agreement whereby fees are pegged at a particular rate, but surely it can be understood that the majority of the public do not respond to the ‘bucket shop’ mentality that some weaker agents within our industry peddle to them.

Instead, they seek a proper service at a proper fee — but how is it that the agents themselves cannot fathom until too late that the important and expensive business of finding a buyer and transacting each deal to conclusion professionally and efficiently, cannot be done on a shoestring?

It is frankly bewildering that this basic fact is lost on so many. The cheap route to selling a home is fundamentally flawed on every level therefore.

The client gets a questionable service and may not even ever sell his home, while the provider of said service cannot afford the decent staffing, training, technology, marketing etc that is needed to do the job properly and so ends up under huge pressure from the unhappy vendor, and then goes out of business. How does that benefit anyone?

I yearn for the day when my peers sit up and start to be proud of what they do and what they charge and to begin to stand up for themselves.

A decent fee for a decent selling experience — what is so wrong with that?

Perhaps our regulatory bodies might one day step in to point out to the cowboys that their low fee levels are not conducive to satisfactory customer service also.

I won’t count on that happening anytime soon, although it is arguably one of the most important aspects of their supervision that they could become involved with, to the benefit of the consumer and the industry alike.With commission rates in other countries at four to six times ours, why do the uninitiated still believe that the answer to lack of business is to sell yourself short and to dig that monetary hole still deeper?

More than one of my competitors (although I use the term hesitantly) is currently offering Thurrock an advertised fee of 0.75 per cent.

They are not now suddenly the biggest agent locally as a result, nor ever will be, and should realise that to set such a pathetic rate means that ALL of their instructions have to be at that hideously low percentage, thus necessitating that they must list even more properties to make up for the shortfall. Nano technology this is not. It’s just common sense.

Our clients get what they pay for and I feel very much indeed for those of you and your families as to what the future holds financially if you fail to take on board this fundamental fact (that most property sellers know already).

I am proudly promoting a current fee of 1.68 per cent in a volume market and despite the foregoing downward pressure from our competitors.

RUSSELL QUIRK,
Quirk Deakin,
Essex.