Property - US style Buyers Agent in the UK


W

wooks

Would the concept of a person who acted on behalf of a buyer (finding
properties, organising viewings conducting negotiations and handling
conveyancing) and was paid a comission, work in the UK.

Has it been tried before.

I'd been interested in any views or information.
 
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M

Mouse

wooks said:
Would the concept of a person who acted on behalf of a buyer (finding
properties, organising viewings conducting negotiations and handling
conveyancing) and was paid a comission, work in the UK.

Has it been tried before.

I'd been interested in any views or information.
Do you mean something like this company:
http://www.garrington.co.uk/

It's owned by the people who do "Location location location" on channel
4.

Mouse.
 
M

me

In message said:
Would the concept of a person who acted on behalf of a buyer (finding
properties, organising viewings conducting negotiations and handling
conveyancing) and was paid a comission, work in the UK.

Has it been tried before.
I'd been interested in any views or information.
There are a few people who do it, we've had a few viewings over the
years from such people but it never led anywhere. I think it would only
really work for the multi-millionaire who instructs someone to go and
buy him a mansion within so many miles of a capital city somewhere, I
don't think there would be too much demand for that sort of thing.

Rather more common, however, are buyers acting for property investment
companies.
 
T

tim \(back at home\)

wooks said:
Would the concept of a person who acted on behalf of a buyer (finding
properties, organising viewings conducting negotiations and handling
conveyancing) and was paid a comission, work in the UK.

Has it been tried before.

I'd been interested in any views or information.
It works in the US because it is (usually) the seller
who picks up the bill.

In the UK it would be the buyer who pays and there
are few buyers who are prepared to pay someone
to trawl Estate Agent ads for them. There are some
who are prepared to pay for this, so there are a small
number of agents who provide such a service, but I
doubt that a extensive chain could be established
for this service.

tim
 
W

wooks

tim said:
It works in the US because it is (usually) the seller
who picks up the bill.
I think thats a misleading oversimplification of what happens in the
US.
In the UK it would be the buyer who pays and there
are few buyers who are prepared to pay someone
to trawl Estate Agent ads for them. There are some
who are prepared to pay for this, so there are a small
number of agents who provide such a service, but I
doubt that a extensive chain could be established
for this service.
Well if you put it like that..... and alternative way of viewing it is
having expert advice on hand for the biggest purchase most people make
in their lifetime. For those who get it wrong it is the most expensive
mistake they will ever make.
 
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T

tim \(back at home\)

wooks said:
I think thats a misleading oversimplification of what happens in the
US.
Perhaps you'd like to tell us the system then.

It is my understanding that when you sell a house in (some
states of) the US the seller is obliged to pay the buyer's agent.
How else would they get away with charging 3% for ringing
around a few selling agents for details and then taking the
buyer on viewings (something that is done by the selling agent
in the UK).
Well if you put it like that..... and alternative way of viewing it is
having expert advice on hand for the biggest purchase most people make
in their lifetime.
The fact that the majority of people don't use such agents
suggests that they don't see it this way either
For those who get it wrong it is the most expensive
mistake they will ever make.
For a very small minority. For most people who make
a mistake, selling it on to some other _mug_ is usually
not too difficult.

tim
 
W

wooks

tim said:
Perhaps you'd like to tell us the system then.

It is my understanding that when you sell a house in (some
states of) the US the seller is obliged to pay the buyer's agent.
How else would they get away with charging 3% for ringing
around a few selling agents for details and then taking the
buyer on viewings (something that is done by the selling agent
in the UK).


The fact that the majority of people don't use such agents
suggests that they don't see it this way either
This would be the same majority that were persuaded that endowment
mortgages were a good idea.
For a very small minority. For most people who make
a mistake, selling it on to some other _mug_ is usually
not too difficult.
The economic viability for the Realtor acting as buyers agent depends
(amongst other things) on their ability to save their clients money by
using their professional skills to get them a better deal than they can
manage by themselves.
 
T

tim \(back at home\)

wooks said:
This would be the same majority that were persuaded that endowment
mortgages were a good idea.
The relevance of this is?
The economic viability for the Realtor acting as buyers agent depends
(amongst other things) on their ability to save their clients money by
using their professional skills to get them a better deal than they can
manage by themselves.
This is patently obvious.

What is not patently obvious is the whether they do, in fact,
achieve this. As it would be impossible, after the negotiation,
to tell if the agent had done better than you could, it is
unsurprising that people won't commit to spending circa
4K on finding out.

tim
 
W

wooks

tim said:
The relevance of this is?
it's as relevant as the point it responds to.
This is patently obvious.

What is not patently obvious is the whether they do, in fact,
achieve this. As it would be impossible, after the negotiation,
to tell if the agent had done better than you could, it is
unsurprising that people won't commit to spending circa
4K on finding out.
Of course it's possible. Everybody has a notional figure of what they
were prepared to pay for a purchase. You simply compare that with the
deal the buyers agent negotiates for you.

Fees are not due until completion - you are obviously not going to
complete on a deal if you are not happy with it. The kind of people
that can nail down to the nearest 5k the optimum price of a 250k home
obviously don't need an agent.
 
T

tim \(back at home\)

wooks said:
it's as relevant as the point it responds to.
I don't agree.

The point is that endowments were actively sold.

The services of a selling agent are passively sold (if
available at all).

You can't compare the take up of one, with the take
up of the other and use that to compare the usefullness
of the product when the real reason for the difference
is the selling process.
Of course it's possible. Everybody has a notional figure of what they
were prepared to pay for a purchase.
No they don't. The average buyer doesn't have the
slightest idea what price he 'ought' to pay for a specific
house when he first visits. You have no way of determining
what price he would have achieved on his own.
You simply compare that with the
deal the buyers agent negotiates for you.

Fees are not due until completion - you are obviously not going to
complete on a deal if you are not happy with it. The kind of people
that can nail down to the nearest 5k the optimum price of a 250k home
obviously don't need an agent.
This discussion isn't about whether they 'need' an agent.
It's about whether they can be persuaded that they offer
value for money.

tim
 
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W

wooks

tim said:
I don't agree.

The point is that endowments were actively sold.

The services of a selling agent are passively sold (if
available at all).

You can't compare the take up of one, with the take
up of the other and use that to compare the usefullness
of the product when the real reason for the difference
is the selling process.
Right. So the real reason that the majority of people don't use buyers
agent is because they haven't been informed/exposed to/sold the
concept.

It's not because the majority think they are a bad idea or don't
believe in them which is what you seemed to suggest.
No they don't. The average buyer doesn't have the
slightest idea what price he 'ought' to pay for a specific
house when he first visits.
Exactly. But in his mind, he has a price that he is prepared to pay for
a property that interests him - which is actually what I said.

It may be too low - in which case a good buyers agent would save him
from missing out on a good deal.It could be too high in which case the
buyers agent would save him money.

Replace "buyers agent" with estate agent in that scenario and the
clients dilemma should be apparent. The estate agent trying to persuade
a buyer that he is undervaluing a property wouldn't be believed and he
isn't going to dissuade a punter from overpaying.
You have no way of determining
what price he would have achieved on his own.
I don't have to.
This discussion isn't about whether they 'need' an agent.
It's about whether they can be persuaded that they offer
value for money.
Right. So like anything else in life you apply your own value for money
criteria to the service on offer. It could be how much money or time
you save. It could be how much trouble (in the legalistic/contractual
sense) you could have got into if you were not represented by a
licensed professional. The analogy you present is that of an estate
agent - but really a more appropriate analogy when you consider the
type of service a buyers agent would have to offer would be an
accountant.
 
T

tim \(back at home\)

wooks said:
Right. So the real reason that the majority of people don't use buyers
agent is because they haven't been informed/exposed to/sold the
concept.

It's not because the majority think they are a bad idea or don't
believe in them which is what you seemed to suggest.
OK, but the original question was a comparison with the
US. You (or anyone) still hasn't addressed my point that
these agents are used by buyers in the US because they
(the buyer) does not directly pay the fees, whereas in the
UK they would. It's easy to get good vfm from something
that you aren't paying for.
Exactly. But in his mind, he has a price that he is prepared to pay for
a property that interests him - which is actually what I said.

It may be too low - in which case a good buyers agent would save him
from missing out on a good deal.It could be too high in which case the
buyers agent would save him money.

Replace "buyers agent" with estate agent in that scenario and the
clients dilemma should be apparent. The estate agent trying to persuade
a buyer that he is undervaluing a property wouldn't be believed and he
isn't going to dissuade a punter from overpaying.
You might be right, but I still suggest that you cannot
prove it.
I don't have to.
You do if you wish to establish whether the buying agent
has achieved a better price.
Right. So like anything else in life you apply your own value for money
criteria to the service on offer.
Are you really suggesting that I am talking about 'my'
position or did you mean "one applies....."

What I am doing here is suggesting why people don't use
buying agents in the UK.
It could be how much money or time
you save.
ISTM that using a buying agent doesn't save very much time.
Selling agents will convey prospective purchasors to
out of the way properties (a job performed by a buying
agent in the US I believe), and many people will find the
idea that the agent looks around properties before picking
a 'few' to show them, rather strange. People like looking
around all the properties for themselves, I am sure that
they would fell that they had missed something they might
have liked if they weren't shown it.

I understand the claimed 'cost' implications, but you really
do have to show that there *is* a cost implication before
you can sell it.
It could be how much trouble (in the legalistic/contractual
sense) you could have got into if you were not represented by a
licensed professional.
We have solicitors who do this. No-one need get in a
contractual mess buying a house in the UK. I understand that
the position in this respect is not so clear in other European
countries.
The analogy you present is that of an estate
I don't think I made this analogy.
agent - but really a more appropriate analogy when you consider the
type of service a buyers agent would have to offer would be an
accountant.
tim
 
W

wooks

tim said:
OK, but the original question was a comparison with the
US. You (or anyone) still hasn't addressed my point that
these agents are used by buyers in the US because they
(the buyer) does not directly pay the fees, whereas in the
UK they would. It's easy to get good vfm from something
that you aren't paying for.
Even if the American system operates as you say the buyer still pays
indirectly in the price he pays for the property. Inevitably the price
could have been lower but for the agent fees.

You might be right, but I still suggest that you cannot
prove it.


You do if you wish to establish whether the buying agent
has achieved a better price.
It's like anything else.
If customers are happy with the service and the price they paid for it
thats all that matters.
Are you really suggesting that I am talking about 'my'
position or did you mean "one applies....."

What I am doing here is suggesting why people don't use
buying agents in the UK.
It's not a service that is widely available at this time nor is there
much information about it so its hardly surprising.
ISTM that using a buying agent doesn't save very much time.
Selling agents will convey prospective purchasors to
out of the way properties (a job performed by a buying
agent in the US I believe), and many people will find the
idea that the agent looks around properties before picking
a 'few' to show them, rather strange. People like looking
around all the properties for themselves, I am sure that
they would fell that they had missed something they might
have liked if they weren't shown it.

I understand the claimed 'cost' implications, but you really
do have to show that there *is* a cost implication before
you can sell it.


We have solicitors who do this. No-one need get in a
contractual mess buying a house in the UK. I understand that
the position in this respect is not so clear in other European
countries.
Imagine how much better a job your solicitor could do for you if he/she
actually came round to the property - viewed it - and asked the seller
(or his agent) questions on your behalf and advised you accordingly.
Negotiating points could be identified, points of contention dealt with
in the contract. Thats the sort of thing buyers agents do in the US.
I don't think I made this analogy.
Maybe analogy is not the right word then but you certainly made the
comparison.
 
T

tim \(back at home\)

wooks said:
Even if the American system operates as you say the buyer still pays
indirectly in the price he pays for the property. Inevitably the price
could have been lower but for the agent fees.
If everyone did it this way yes. But AIUI the problem
is the seller has no choice but to pay the buyers agent.
He has to price his property on the basis that he will
do so, and I think that he is not allowed to discriminate
against buyers who are using one.
It's not a service that is widely available at this time nor is there
much information about it so its hardly surprising.
I not sure what your point is.

I agree that the service isn't widely available.
But the discussion is about whether it would be
purchased if it was. You can't use the fact that
the service isn't widely available as 'evidence'
in such a discussion.
Imagine how much better a job your solicitor could do for you if he/she
actually came round to the property - viewed it - and asked the seller
(or his agent) questions on your behalf and advised you accordingly.
They do ask the seller questions. I think you are underestimating
the UK legal system.

tim
 
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W

wooks

tim said:
If everyone did it this way yes. But AIUI the problem
is the seller has no choice but to pay the buyers agent.
He has to price his property on the basis that he will
do so, and I think that he is not allowed to discriminate
against buyers who are using one.


I not sure what your point is.

I agree that the service isn't widely available.
But the discussion is about whether it would be
purchased if it was. You can't use the fact that
the service isn't widely available as 'evidence'
in such a discussion.
Up until the late 80's the Americans were operating a system similar to
ours. The concept of Buyers agents started taking hold in the early
90's and it has evolved to the current situation where it is the
dominant paradigm for real estate business. This wasn't a changed
forced on Americans it happened because people saw advantages and
switched. In this regard the Americans are farther down the road on the
evolutionary cycle than the UK.

You are focusing solely on the increased costs of real estate
transactions in the US, but the fact is the Americans pay more to their
realtors and get more of a service. They deal with regulated licensed
professionals who can be sued for failing in their obligations to their
clients. In the UK estate agents still get a hefty whack for providing
far less of a service and you put your trust in him at your peril -
Latinos have a saying - the cheap can turn out to be very expensive.
From the links that I have read it seems the marketplace is amenable to
such an innovation. Time will tell.
 
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