Budget player joins ranks of buying agents

House-buying agents have traditionally been the preserve of wealthy property purchasers – but a new low-cost company has now launched with the aim of bringing its negotiating skills to the mainstream market.

Buyers Edge, unlike rival buying agents, does not charge an upfront fee. Tim Hammond, its chief executive, says homebuyers will pay a fee only if the company negotiates a discount on a property that a client wants to purchase. Buyers Edge will then charge
either 1.5 per cent of the purchase price or 15 per cent of the saving on the asking price, whichever is greater.

“We want to offer the buying agent service to any type of homebuyer,” says Hammond. “You don’t have to be rich to be busy – and most people are busy.”

A buying agent works on behalf of the buyer – in contrast to an estate agent, whose job is to obtain the maximum price for the seller. Buying agents help buyers through every step of their home purchase, from locating a shortlist
of properties to negotiating the best price and terms.

Hefty upfront fees and commissions have tended to mean that only wealthy buyers could afford buying agents.

Property Vision, one of the biggest players in the UK market, charges an upfront fee of £2,500 and a 2.75 per cent commission based on the purchase price. Prime Purchase, the buying arm of Savills, and The Buying Solution, part of Knight Frank, both charge an initial upfront fee of £2,500 and 2.5 per cent of the purchase price.

“The initial upfront fee is non-negotiable,” points out Nathalie Hirst, director of Prime Purchase.

She says this fee is charged because the agent can, sometimes, spend several months acting for a client who then – for professional or personal reasons – decides not to buy. “This fee just covers some of our initial costs,” she explains.

Property Vision typically looks at properties with a value of £1m plus, while The Buying Solution starts from a minimum of £1.5m.

But Hammond of Buyers Edge says his company will help clients with budgets as small as £250,000, as well as wealthy clients buying £1m-plus properties.

Sourcingproperty.co.uk is another service that will deal with lower-valued properties. It charges a £500 fee for three months and a commission of 1.5 per cent.

“One of the reasons why we’re launching now is that there has been so much confusion and uncertainty in the housing market – there’s no better time for this type of service,” Hammond says.

Tracy Kellett of BDI Homefinders, another home-buying agent, says she is in favour of opening up services to the lower end of the market but stresses that homebuyers should look carefully at what they are getting. Buying agents that charge more will typically offer a longer search time, full project management and after-sales care.

BDI Homefinders charges would-be buyers an upfront fee of £1,500 for a period of nine months and a commission of 1.5 per cent of the purchase price. The standard contract for Buyers Edge is for three months.

“Buying agents at the upper end of the property market have a carefully built network of contacts and have access to properties that are not on the open market,” says Charles McDowell, a buying agent.

“More often than not, these properties are only heard of by word of mouth as vendors want maximum discretion. It is as much about securing the property they want as buying at the right price,” he adds.

According to Charlie Ellingworth, founder of Property Vision, negotiating skills are one of the main reasons why purchasers opt to use a buying agent. Ellingworth also points out that telling people when not to buy a property is equally valuable.

Homebuyers can search for a buying agent through the website of the Association of Property Finders and Buying Agents. Go to:

www.apfba.org