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September 12, 2022
Jeremy McGivern
Posted in: Finding a property consultant

The Difference between a Property Consultant and an Estate Agent

There is a big difference between what a property consultant and an estate agent does.

In the U.K. most people rely on estate agents to buy and sell their property. But if you are a buyer, this leaves you at a massive disadvantage because estate agents are legally obliged to achieve the highest price possible for their clients, the sellers.

You, the buyer, are not their client. In estate agent jargon, you are called an “applicant” which gives you an idea of the level of service and expertise you can expect to receive, i.e. not much. Indeed, estate agents are a permanent fixture in the lists of the top ten least liked professions in the UK.

The reason is that most buyers forget the true role of the agent:

Their job is not to find you your ideal home or investment property. No, their job is to sell any one of their clients’ properties to any applicant who is registered with them and for the highest price possible.

In other words, they work in direct opposition with buyers whose two main goals are:

  1. To find the best property your money can buy
  2. To acquire the property for the lowest price/best terms possible.

So, does it sound like a good idea to rely on estate agents when acquiring a property in prime central London?

By the way, this is not a diatribe against the estate agents, because the best estate agents are very good at what they do and achieve some incredible prices for their clients, the sellers.

This is why I never sell properties for my clients – I will advise them on which are the best agents to use for their particular property and I will manage the agents on behalf of my clients. But my company never sells properties because I know that the good agents will achieve the best price.

Unfortunately, this doesn’t help you as a buyer!

However, as with any profession, there are good, average and downright incompetent estate agents. This creates opportunities because some agents undervalue properties. Some are bad negotiators and others just want to get their commission so are more interested in ensuring that a transaction happens rather than giving their clients the best advice.

How can you use this information to your advantage?

Most buyers forget the role of the estate agent which is one of the main reasons that they find the process of finding a property so frustrating. They don’t understand why they are being sent details of properties that have little in common with the type of property they want to buy.

The other issue in the UK is that there is not a Multiple Listing System (MLS) like there is in the USA, for example. In other words, the agents can only sell the properties on which they are directly instructed.

Occasionally, they do share properties with other agents, but these tend to be the ones that are difficult to sell, i.e. they are overvalued or are severely compromised in some way, so probably not the type of property you should be buying.

The invention of the internet and the huge number of property websites was meant to improve the situation, but it really hasn’t done much except make it more competitive. By this I mean that if you rely on the websites, all you are really doing is copying what every other buyer is doing.

In other words, if every other buyer is trawling the big property portals and setting up “property alerts” all you are doing is joining a long queue of buyers for the same properties. What competitive advantage does that give you?

If you want to find the best property your money can buy and acquire it for the lowest price possible then you need to have first refusal on the best opportunities. Does joining a queue – even if it is a virtual one – sound like the best way to achieve this?

And the other fact that escapes buyers is that there is not one site in the UK that lists all the properties. That is a problem and when you get to the top of the market, the estate agents themselves openly admit that many of their properties never even reach the open market.

The likes of Savills and Knight Frank say that c. 25% of the properties they sell are off-market while the highest figure I have seen quoted is 75%. I am not sure that this is right but on average between 25% and 33% of the properties I acquire for my clients are off-market.

So, if you are planning to acquire a property for over £1m would it be a bad idea to source properties other than via the internet? And this is especially true the higher the value of the property that you wish to buy. This is why we speak to over 200 estate agents per week and we also have a list of over 500 off-market contacts.

property consultant

How does a property consultant differ from an estate agent?

Property consultants are also sometimes called property search agents, property finders or buying agents.

As you may already have guessed, I only represent buyers. Indeed, I founded Mercury Homesearch in 2001 because I became fed up as a buyer with the service I was receiving from the estate agents. I couldn’t understand why I was taking advice from someone who was trying to achieve the highest price possible.

So, a good property consultant should approach the property market from the opposite angle to the estate agents. My role is to protect your best interests and here are some of the ways property consultants and buying agents differ from the estate agents:

  1. You will only receive the details of properties that match your criteria so that your time is not wasted
  2. You will have access to off-market properties that the typical buyer will never even know exist
  3. You will receive objective advice on the quality of the property
  4. You will be given an objective view on what represents fair value and be given accurate comparators
  5. You will be represented by an expert negotiator to achieve the lowest price/most favourable terms possible
  6. You will be introduced to the relevant and most reliable professionals, e.g. solicitors, surveyors, etc. to ensure that the transaction progresses smoothly
  7. You will not have to waste time with unnecessary bureaucracy as this will be handled by us

I won’t go into each of these in too much detail, but it is worth saying a little more about point 4 and accurate comparators.

While the estate agents represent the sellers, they are not allowed to lie to you. In my experience, the vast majority of agents in prime central London are honest. However, this does not mean that they cannot use statistics to make properties seem better value than they are.

For example, you may be interested in a property that is valued at £2,000 per square foot and the agent may tell you that it is good value because another property in the same street has just sold for £2,200 per square foot.

But that property could be better for a whole host of reasons: it may have higher ceilings, be in a better building, have a longer lease, be in better condition, have a better view, etc. And it may just be that the buyer paid far too much!

In other words, you need far more data and a much better understanding of valuations for the type of property you wish to buy. One of the biggest mistakes I see buyers making is relying on pound per square foot valuations, but as I have hopefully demonstrated here, they are a very blunt instrument as there are several factors that will affect price and the ones I have listed are just the tip of the iceberg.

So, please ensure that you do your research and have access to all the relevant information about other properties that have sold in the area (also please remember that asking prices are irrelevant – only sold properties should be used as comparators).

property consultant luxury

A Word of Caution 

While I believe that most buyers would find better properties and acquire them for lower prices if they used a property consultant, there are issues.

Just like any other profession, there are property consultants who are not up to standard. Indeed, there has been a proliferation in the number of property consultants over the last decade or so and, unfortunately, many do not offer the type of expertise and fiduciary care one would hope for.

Many are estate agents who have switched sides but forgotten that looking after the buyer is less important than the transaction. Others are people who are simply attracted by the high fees and the fact that there is a low barrier to entry, i.e. regulation is pretty feeble. And then there are the firms who both buy and sell property. But how can you play both sides of the coin and offer the best advice?

So, when choosing a property consultant, it is essential that you read testimonials, speak to past clients and gather proof about their ability to find the best opportunities and negotiate favourable prices, i.e. make sure that they have a proven track record.

The best also offer guarantees.

Contact Mercury Homesearch – Luxury Property Consultant

To discover more about how we can find you your ideal home or investment property and negotiate the lowest price possible, simply email dee@mercuryhomesearch.com or call 02034588855 (+442034578855 from outside the UK).

Topic: property consultant London

About the author, Jeremy McGivern

My name is Jeremy McGivern. I am the founder of Mercury Homesearch, the internationally renowned property search consultancy, and author of The Insider’s Guide To Acquiring Luxury Property in Prime Central London. I have been acquiring property in prime central London for clients for over 13 years.

Having physically viewed over 22,000 properties in prime central London, studied the details of over 153,400 apartments, houses and investment opportunities and spoken to 232+ estate agents every week for over a decade.

My advice is in high demand and has featured everywhere from Bloomberg Television, The Financial Times and The Daily Telegraph to Forbes India and Bahrain Confidential.

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