A guide to help you stop reducing your agency fees

Even if you have qualified your landlord or house seller correctly, there are still times when your landlord or house seller asks for a reduction in your fees. How do you cope with that? How do you keep your fee up and still get the landlord/house seller to use your lettings/estate agency ? It really makes you want to cry sometimes, doesn’t it?

Fees are such an emotive issue for a letting agent / estate agent. You don’t want to charge too much and lose the landlord or house seller. Then again, you don’t want to charge too little and not make enough for the landlord or house seller to be profitable. At first sight, a landlord or house seller asking for a fee reduction is a big, big problem. However, it is actually a good sign because it shows that you are close to signing them up.

What you must not to do is reduce your fees without rhyme or reason, as this is educating your landlord or house seller that every time they want a fee reduction, they just need to ask and you will do it.

What you need to do instead is establish exactly what service you are delivering to them. You need to find out what it is that the landlord or house seller really wants from you, and what is a non-essential. If you can cut the non-essentials from your packaged offering, then you can offer your client a more bespoke package at a reduced fee. Your client is happy, and you are happy because you have signed up a client and not reduced your hourly rate or devalued what you do for clients.

Ah, but Chris, what if you don’t have the option to trim away parts of what you will do for the client? You may find that one of these methods may help eliminate the stalemate: The first is that you explain that the fee is what it is, and if they don’t want to pay this fee you will happily walk away, no hard feelings. Sometimes this works, and they still sign up. Or you should restate the benefits of using your services and how this will help them achieve their goals (especially if the asking price is high).

Another approach would be to demonstrate to them why it costs so much to sell or let a property and why you don’t have the room to reduce your fees. Or you explain (it needs to real and credible) to illustrate how other landlords/house sellers have also had doubts about your fees, but achieved great results, which justified your fee.

You could offer stage payments, if they are worried about the hit to their cash flow. (letting agents, you could spread the upfront set fee over a few months) or finally, agree a different pricing structure based on results achieved. (Estate agents – You have quoted 1.5%, client wants 1%. Suggest you say if the property sells below a certain figure its 1% but if it sells above that figure, you will charge 1.75% ).

These are just some of the things I have come across in my years in estate agency and lettings. If you know of anymore, do let me know. Try them yourself .. you might just be a happier agent?

What does anyone else think?

(For more articles like this, please go to the blog that helps agents get more business http://how-to-grow-your-lettings-agency.blogspot.co.uk/)

Christopher Watkin

I teach, guide, support, mentor, consult, counsel, partner many hundreds of UK Estate and Letting Agents in their quest to grow their estate and lettings agencies business. Old school techniques of touting, landlords wanted leaflets, ring us for a free valuation, we have sold this in your street leaflets don't work anymore. There are too many competitor agents .. meaning cheap fees are epidemic, overvaluing is almost a norm to get the stock and don’t even mention about the online/hybrid threat. So a few years ago, I set about looking around the UK and spotted that certain agents (not many mind you) in certain towns were still seen as the ‘go to person on property’, the person the newspaper editor rang up every week for a comment and I looked at what they did and they were doing some thing quite remarkable…. Only one thing but they were doing it so well .. and reaping the reward in terms of decent listings and decent fees, happy staff, decent sales pipeline and exchange income, managed lettings portfolios in the many hundreds .. but more importantly, they really enjoyed the job… they enjoyed getting up in the morning and people looked up to them Over 400 agents around the UK are on a mission to change the way our Estate and Lettings agency profession is perceived and looked upon, doing it town by town, city by city. I guide these 400 agents, teach them, mentor them and support them to be seen in a different light, to be seen as the ‘go to person for property’, actually be the ‘local property expert’ and prove it. Christopher Watkin 07950 147 572 christopher@christopherwatkin.co.uk

You May Also Enjoy

Breaking News

Weekly News Roundup – 19/04/24

A roundup of the week’s top property and proptech news stories in partnership with Proptech-X Table of Contents Ascendix deep dives into the world of the AVM CEO Adam Pigott on tour in Norfolk with tlyfe App VTS Activate Multifamily launches   Ascendix deep dives into the world of the AVM This month Yana Yarotska from Ascendix…
Read More
Breaking News

Breaking Property News – 18/04/24

Daily bite-sized proptech and property news in partnership with Proptech-X.   Scotland to get to Net Zero by 2045 in stunning U-turn Because of its serious implications here in full is the Scottish ‘apology or explanation’ why it thinks it is OK to let the planet burn for the next two decades. Net Zero and…
Read More
Breaking News

Breaking Property News – 17/04/24

Daily bite-sized proptech and property news in partnership with Proptech-X.   CEO Adam Pigott on tour in Norfolk with tlyfe App Full disclosure CEO Adam Pigott and his team are one of my earliest clients, so it is always a pleasure to hear what they have been getting up to. And this week they were…
Read More
Love or Hate Rightmove
Breaking News

Rightmove’s weekly mortgage tracker

Headlines The average 5-year fixed mortgage rate is now 4.84%, up from 4.45% a year ago The average 2-year fixed mortgage rate is now 5.23%, up from 4.77% a year ago The average 85% LTV 5-year fixed mortgage rate is now 4.77%, up from 4.46% a year ago The average 60% LTV 5-year fixed mortgage…
Read More
Rightmove logo
Breaking News

Rightmove comment on inflation reducing to 3.2%

UK inflation slowed less than expected last month, making traders and economists more cautious about the likely pace of interest rate cuts. Matt Smith, Rightmove’s mortgage expert said: ‘It’s positive to see inflation continuing to fall this morning, albeit not by quite as much as expected, as the blocks continue to build towards the anticipated…
Read More
Estate Agent Talk

Multifaceted Rewards of Vineyard Estates: Investing in Vineyard Estates in Provence for a Fulfilling Lifestyle Business

Vineyard estates provide an exceptional opportunity to invest in a lifestyle business that aligns with a passion for crafting something unique, freedom for creativity, and business interests while harmonizing with the rhythms of nature. In Provence, you can invest in winemaking and foster authentic connections with the land and community while enjoying your returns. It’s…
Read More