What is a Buying Agent?
Buying agents find the perfect property for potential buyers. They have a similar role to estate agents, but they work in the interest of the buyer.
Property buying agents will research properties based on the buyer’s criteria. They will then negotiate with the seller’s estate agent for the best price and terms. They can assist in purchasing homes that are not even on the market, whilst also negotiating the best price.
Whether you are looking for a small property in London or investing in country houses in regional areas, buying agents can help. They can offer a boost in competitive markets such as sellers' markets.
In this guide, we’ve gathered everything you need to know about buying agencies and what to expect from the conveyancing process if you use one.
What Do They Do?
Buying agents strive to find the finest property that fits your criteria and ensure you get the best deal. Offering a detailed brief means that your buying agent will have a higher understanding of what to look out for. Thanks to their inside knowledge, they can offer impartial advice and negotiate with estate agents.
Here are some of the jobs that your buying agent may take on:
Find properties that meet your requirements
A buying agent’s main task is to find a property that meets your criteria. This means they will search the local market to ensure that the shortlisted properties they offer are what you are looking for. This can include property type and specific locations.
Provide access to properties not on the market yet
Since agents have extensive local knowledge, they may be able to offer access to off-market properties.
This means there are even more options to discuss and you can find a property in the right location that suits your needs.
Negotiate with the seller and their estate agent
Since they are working on your behalf, they will achieve the best possible terms with the seller and their estate agent. They are also expert negotiators, meaning they can save you more money.
Read more about Making an Offer on a House
Give a valuation
Buying agents can use their expertise and knowledge of the local area to provide an approximate valuation. They consider current house prices in the area and local amenities to determine the market value. They can use this valuation to assist in negotiations with the seller’s estate agent to get the best deal.
How Much are Buying Agent Fees?
The average buying agent registration or retainer fee is £1,365 including VAT. Your agent may then charge this amount at subsequent intervals, depending on how long the transaction takes to go through. They will then deduct this amount from the total bill at the end of the process.
There are several fee structures that buying agents may adhere to. This means that the total amount you will end up paying can be hugely different. For example, buying agencies are likely to charge more for affluent properties.
London buying agents charge more for properties in areas such as South Kensington and Notting Hill. In comparison, buying agent fees may be lower when working in home counties outside the Capital.
Here are the fee structures you need to know about:
Percent of Price
The first form of fee structure that is commonly applied is charging a percentage of the buying price. It is typically between 0.5% and 2% of the final purchase price. The percentage can vary depending on multiple factors. These include property type, market conditions, and property value.
Fixed Fee
A fixed fee means that your buying agent will provide you with a full cost at the beginning of the process. You will pay this cost regardless of the property value and what you buy it for.
Saving Fee
A saving fee, also known as a success fee, is a difference between the asking price and the agreed purchase price. Your agent may charge a percentage of the saving fee.
It’s important to confirm with your agent what fee structure they follow as this allows you to budget accordingly.
Buying agent average fee figure taken from HOA, Henry Pryor, Perrygate, The Buying Agents, and Swallow & Castle
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When Would I Need One?
There are no specific requirements to meet when hiring a buying agent. Most agencies offer a no-obligation consultation, so you can discuss what they offer and how they can help.
One of the main benefits is that buying agents can ensure that the start of the buying process is as stress-free as possible. Their knowledge of the property industry provides a huge advantage and can make you stand out in bidding wars. However, due to the high costs, it is a decision you will need to think carefully about.
There are certain circumstances where it is highly recommended. Here are some of the common reasons people hire a buying agent:
Landlord and Investors
Landlords and investors looking to purchase a new property commonly hire buying agents. This is because buying agents will have market knowledge of the area in which you are looking to buy the property.
They will be able to recommend buy-to-let solicitors and provide advice so you can make a sound investment decision.
Buying a UK property from abroad
Those who live abroad and are looking to buy a property in the UK would also benefit from hiring a buying agent. Buying from abroad means you will have a limited scope of the housing market in the UK. Therefore, buying agents can prevent international clients from making costly mistakes.
First-time buyers
First-time buyers or those with limited experience may feel nervous about their purchase. A buying agent will be able to conduct the research and negotiate with the seller.
Sellers’ Market
If you are buying in a sellers’ market, it can be extremely daunting and competitive due to the limited number of properties on the real estate market. Buying agents provide objective advice for individuals. They also offer an advantage thanks to their industry contacts.
Time Constraints
Those who need to embark on a quick or last-minute move will benefit enormously from buying agents.
The buying process can be extremely time-consuming, but buying agents can negotiate the best price and speed up the process. This will save you time and help you purchase the property that you want.
Read more on the Moving House Timeline
Buying Agent vs Estate Agent
Buying agents and estate agents have similar jobs; however, there is one major difference that sets them apart. Buying agents help buyers purchase their ideal property whereas estate agents work on behalf of the seller rather than the buyer.
Most buying agencies are registered with the Property Ombudsman, which is a good place to start in your research.
Some buying agents receive a commission if you hire recommended mortgage brokers or wealth managers. This means it's important to check that they are not receiving financial incentives from other parties.
Estate agents typically receive a commission from the property sale as they receive a portion of the seller’s profits. This means that it is in their best interest to fight for the highest possible price.
Read more on What Does an Estate Agent Do?
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Is it Worth Getting a Buying Agent?
Hiring a buying agent can be hugely beneficial, especially if you are looking to buy during a seller’s market. Buying agents can save you considerable time and stress, as they will conduct the research and negotiations on your behalf.
Choosing a local buying agent who works in your search area is massively advantageous. They will already have a clear idea of the local housing market. This allows them to begin the search process imminently and ensures that their buying service is quick and efficient.
Buying agents assist in getting you to the conveyancing process and proceeding with the legal transfer. However, due to the cost of hiring a buying agent, it’s best to make sure that you can afford the fees beforehand.
Finding a Conveyancer
Once you have had your offer accepted, you will need to hire a conveyancer to guide you through the legal process. Compare My Move has a conveyancing partner network consisting of firms from across the UK.
All our partners are regulated by either the SRA, CLC, LSS, LSNI, or CILEX and have passed a strict verification process.
We can connect you with up to 6 licensed conveyancers, allowing you to compare quotes and save money on your conveyancing fees.
