to be surprised that our estate agent's took their commission from the original marketed price rather than the final sale price?

[Housewife2010]

My sister has just sold our late Mother's house. It has been on the market for nearly 2 years & we had to keep dropping the price. It finally sold last week & we were surprised that the estate agent's took their 1.25% commission from the original marketed price rather than the final sale price. We had to drop the price by 40k to finally get a sale. As my sister lives near the house she organised the sale & missed the small print. As she did all the work I don't blame her at all. However, I want to know if this is standard practice? If so, surely it's in estate agent's interests to give an over-inflated starting price to ensure that they get more money.

Sounds wrong to me. I'd drop them a note saying they've obviously made an error, could they send a credit note so that you can settle the account.

I've never heard of this. What was in the contract?

I don't think it Is standard practice, no. Is it definitely what it says in the agency agreement?

I've never heard that happening before - any estate agent I've dealt with has always been % of sale price, thus incentivising them to get the best price possible from the buyers. This sounds like very poor practice on behalf of the estate agents. Doe sit definitely say that in the small print of your contract with them?

Does it actually say in the small print that they can do that? wow.

certainly challenge it.

No, definitely not standard practice.

Please name and shame the agency .

I'm sure it's supposed to be a percentage of the sale price. Has been with all estate agents I've dealt with. Do what ajandjjmum suggests.

not standard practice here - Mine took the percentage from the final sale price

thieving cunts

but what if the house had gone UP in value , would you be complaining then ??

When we sold our house, one of the agents who valued the house gave us a contract which had their commission based on the original sale price. Needless to say, we didn't use them

You can bet kitty if it had gone up it would have been 1.25% of that final price!

Sounds very wrong, but I wonder if a contract is a contract if signed? I don't know.

They are certainly not following the code of practice see para 3h

Might be worth contacting the propertyh ombudsman to see if there is anything you can do.

I've never heard of that. That's appalling. Name and shame, definitely

kitty - if house value had gone up when i sold, i wouldn't be complaining because estate agent would only get 1.25% of that increase and i'd get 98.75% of it. that is why they are always incentivised on sale price - so they work bloody hard to get as high a price as possible so both vendor and agent win. if they just get % of starting price, they can put that at double what the market takes and then recommend the first crap offer that comes along so they can get their hands on their commission without having to do any work at all.

They sound like crooks
NAME AND SHAME!

It's definitely not standard practice - like everyone else on this thread I've never encountered this. The whole point about using a percentage rate is that it induces the estate agent to negotiate the best possible deal for your property.

Check the small print and check that she didn't in fact negotiate a flat fee (which is accepted).

The other possibility (sounds silly but just to avoid a red face if you're not!) you are aware that their commission incurs VAT...? So their final cut will be 20% more than you were expecting.

well - to clarify my last point - THEIR final cut will not be 20% more, it will be exactly what you thought it was. But you ALSO have to pay the VAT man 20% of their cut.

This is normal, and is not usually taken into account when setting the %.

But if this is not the explanation then definitely query it as ajandjj suggests.

if it is in the standard terms and not pointed out to you you would have a good case for saying it was void for unreasonableness under the Unfair Contract Terms Act.

unless it is a VAT blip like young visitor said

The house hasn't gone up in value though. They've taken a percentage of an imaginary figure! Challenge it.

It's Farrell Heyworth - a North West firm. In the small print it says that the "fees are regardless of whether the property realises a higher or lower value".
I've never sold a property before and my sister swapped to this Estate Agent's after the house had been with a previous Agent for a year & there were very few viewings. However, this practice means that its in their interests to bump up the asking price but as an earlier poster said, they have no incentive to sell it at a high price.

Crooks! They can have a flat fee or they can have a percentage. They can't have a percentage which is in effect a flat fee because it's not dropping even if the sale price does!

oh dear lots of crap reviews here. Including one about the charges identical to your situation.

PMSL @ duplicitiousbitch