NAEA: Estate agents' flat fee scheme risks both parties

Date:Monday 27th October 2008

A new flat fee option offered by a London estate agent firm brings risks to both the agent and the customer, it has been claimed.

Peter Bolton King, chief executive of the National Association of Estate Agents (NAEA), was commenting on the system from Lauristons, by which customers can choose between a flat upfront fee of £999 when the property is put up for sale, or a two to three per cent commission when it is sold.

Mr Bolton King said the agent was taking a chance, as £999 is much less than the average commission.

And he said that if a property is withdrawn, the homeowner has lost the fee.

Steve Truman of Lauristons said that the scheme might be extended beyond December, depending on the response to it.

He said interest in it in its first two weeks had been "mammoth".

According to figures released by the Royal Institute of Chartered Surveyors earlier this month, new buyer enquiries and newly agreed sales net balances are still negative but have both improved for the fifth month in a row.