Estate agents' fees

If you are selling your home through an estate agent, you will have to pay commission and fees. How much you have to pay normally depends on the type of contract you have with the estate agent.

You don't usually have to pay anything until the sale is completed and you shouldn't have to pay for anything you didn't agree to in advance.

Commission on the sale of your home

People selling their homes normally have to give a percentage of the sale price (often between one and three per cent) to the estate agent as commission. How much agents charge usually depends on the type of contract you agree to have with them. It is usually worth shopping around and getting quotes from a few different estate agents before you agree to sell through a particular agent. Ask what they charge for each different type of contract.

The contract with your estate agent

There are different types of contracts available, which usually affect how much you have to pay. The type of agreement you have should be clearly explained to you. The most common contracts (in order of how much they cost) are as follows:

  • Sole selling rights - no one else (including you) can sell your home. If you give sole selling rights to more than one agency, you will have to pay the full commission to each of them when the property is sold. Sole selling rights is usually the cheapest type of contract, but you will have to pay commission even if you find a buyer privately.
  • Sole agency - no other agent can sell your property until the contract between you and the estate agent ends. If you give sole agency to more than one agency, you normally have to pay commission to both of them. If you find a buyer privately, you don't have to pay commission, but may have to pay for other expenses.
  • Joint sole agency - two agents agree to share one commission, regardless of which of them finds a buyer. The commission is usually higher than you would pay for a sole agency or sole selling rights contract.
  • Ready, willing and able purchaser - you only have to pay if the estate agent finds a buyer who is willing to exchange contracts without any other conditions. If you pull out, you will still have to pay commission.
  • Multiple agency - several estate agents are marketing your property separately. You only have to pay commission to the agent who sells the property, but the rate is likely to be highest with this type of contract.

You are normally billed on exchange of contracts and have to pay on the completion date. However, if you have a 'ready willing and able purchaser' contract, you usually have to pay when the agent finds a buyer. Some agents may not give you a written contract, but you should ask for written confirmation of what percentage commission you have to pay and when you will have to pay it before you agree to anything.

Getting out of the contract with your estate agent

If you want to switch to a new estate agent, check to see what your existing contract says first. How long is it for and do you have the right to cancel it early? You will probably have to pay for any expenses the agent has already incurred. Depending on the type of contract you have, you also may have to:

  • pay a penalty for moving to another agent
  • pay the agreed commission even if your home is sold by a different agent.

If you want to take your home off the market, you don't normally have to pay any penalties or commission but you will probably have to pay for any expenses the agent has already incurred.

Fees for estate agent expenses

You may be charged separately for the agent's expenses or they could be included in the commission. Ask what services are included and check whether you will have to pay anything extra for things like:

  • valuing the property and advising on the price you are likely to get
  • producing the property particulars and photographs
  • advertising through newspapers, window displays and/or 'For Sale' signs
  • arranging viewings and negotiating offers
  • VAT.

If these are not included in the commission, your contract with the agent should make clear whether the amount you will have to pay is fixed or variable. This may be important if it takes a long time to find a suitable buyer. If it's not a fixed amount, the contract should give details of how fees will be calculated and an estimate of how much they might be.

The estate agent's bill for their services

The estate agent's bill should include a detailed breakdown that is consistent with your contract. If it seems too high, you should ask the estate agent to explain the costs involved.

If the amount wasn't calculated in the way that was agreed in your contract, get advice. You may not have to pay the extra costs. However, you may need advice from a solicitor or Citizens Advice if the estate agent insists that you have to pay - use our directory to find a local legal advice centre.

If you (or your solicitor) have already paid the bill, you can ask for a refund. If the agency refuses to give you any money back, you can make a complaint.

You could also consider taking the estate agent to court but this could be expensive and you will probably need help from a solicitor.