Lloyds TSB research revealed this week shows that the cost of moving is, typically £9000. The largest chunk of this, 38% in fact, is devoted to paying estate agents.
Moving home cost £5,290 in 2001. Now, the bill is 64% higher thanks largely to a rise in agency selling fees of £1,320 from £2057 a decade ago to £3,377 in 2011. The hike mirrors the increase in property prices with agents traditionally taking an arguably unjustifiable percentage of sale price no matter whether their efforts reflect such a value or not.
Suren Thiru, housing economist at Lloyds TSB, said: “With the costs associated with completing a home move in the UK rising substantially over the past decade, the task for those looking to move home has undoubtedly become more challenging. The significant rise in home moving costs is particularly concerning at a time when demand in the UK housing market is weak.”
Concerning…. That’s an understatement. And a bold one at that from a banking organisation at a time when lenders themselves are being chastised for being obvious for their lack of assistance in helping struggling home buyers.
But Lloyds’ hypocrisy aside, never a sector to let morals get in the way of a self-promoting press release, the research does paint an increasingly unsustainable picture for traditional property firms. Especially as the latest commission numbers are indicative of average estate agents fees of 1.8%, up from 1.6% when the Office of Fair Trading last took a peek under the covers of the property industry in 2009.
Using a High Street estate agent costs a significant proportion of the expense of moving home. But let’s not allow conveyancers and lenders’ arrangement fees off the hook either as their remuneration has doubled in the past ten years.
But if you turn to our more sensible low cost estate agents option, that £9000 dilutes to a rather more palatable total of £6000 in lawyers fees, stamp duty and eMoov fixed fees. A reduction of 33% on using expensive, traditional firms.
High Street estate agents? Just say no.