is a term used in the UK to describe people acting as agents on behalf of a buyer and not the seller, as do traditional Estate agents (or, in the United States
The United States of America is a federal constitutional republic comprising fifty states and a federal district...
, Real estate brokers) whose job is to obtain the maximum price for a property for the seller. Buying agents represent the buyer's interests and normally undertake negotiations on their behalf to acquire a property for the best possible price and terms.
A buying agent should provide the following services. They should be finding property from the whole of the Market and making sure that the properties they show their clients are not only suitable but are good examples of both quality and value. They should also have access to off-Market properties through their network of contacts. They should be accompanying their clients to all properties. They must be working only on behalf of their clients so when the property is being negotiated upon, they must have their clients interests at heart at all times. Buying agents should be able to provide all necessary technical trades people for the buying process. From lawyers, surveyors electricians et al, to ensure the property is a solid purchase. If it is not, they must advise their clients accordingly with no self interest for their own fee. A good buying agent will follow the process right through to completion. At this stage,(or at exchange of contracts), their fee is due. These fees range from 1% to 2.5% of purchase price. In addition all good buying agents will only work on a retained basis, fees of £500 to £2500 are the norm. Buying agents work on timed contracts from 3 - 9 months is the average.
The buying agent differs greatly from the US model of real estate. It is uniquely British as Estate Agents within the UK only ever work for the property vendors.
According to The Observer
The Observer is a British newspaper, published on Sundays. In the same place on the political spectrum as its daily sister paper The Guardian, which acquired it in 1993, it takes a liberal or social democratic line on most issues. It is the world's oldest Sunday newspaper.-Origins:The first issue,...
, around 63% of homes in the USA were bought using Buying Agents (or, as they are known there, Buyers agents
A buyer brokerage or buyer agency is the practice of real estate brokers and their agents representing a buyer in a real estate transaction rather than, by default, representing the seller either directly or as a sub-agent. In the United Kingdom and Australia, the most common term is buying...
) whilst the figure in the UK was closer to 1%. However, as the British property market booms, the figure is rising dramatically.
In the UK, the concept of Buying Agents first appeared in the 1980s, with one major pioneering company being founded in 1984, and it developed the trend for buyer representation, leading to a noticeable increase in private sales (without the need for estate agents). Buying Agents have always been the preserve of the seriously wealthy with million pound-plus houses, but 'entry-levels' are falling all the time, with many Agents now taking on searches for property valued at under £300,000.
Television shows such as Location, Location, Location
have raised the profile of Buying Agents in the UK, and have facilitated the emergence of national 'chains'.
Advantages and attributes of Buying Agents
The main advantages of using a buying agent are the savings in time and money and access to properties not available on the open market. Whilst nearly all charge a registration fee (anything between £500 and £2500) and a percentage of the purchase price of the property (usually between 1.5% and 2% of the sale price), the agent's negotiating skills and access to properties before they reach the open market often mean that clients purchase properties for substantially less than they would if they went to estate agents or vendors directly.
Buying agents will preview properties for each client, shortlist the most suitable, and usually accompany clients on viewings of the shortlisted properties. Many offer services such as helicopter viewings and chauffers for high-end clients.
Most Buying Agents specialise in a particular location: a large part of their expertise is derived from local knowledge, personal contacts with local estate agents, and inside-information about properties that are not yet on the open market. Buying Agents generally form lasting symbiotic relationships with estate agents, ensuring estate agents have access to a steady supply of qualified, serious buyers and in return, buying agents receive access to the most desirable properties before they reach the open market. Situations can arise where Buying Agents and Estate Agents 'wrap-up' areas, dealing so regularly with each other that 'normal' buyers are excluded from the market.
Agency sizes vary from the one-man-band with an encyclopaedic knowledge of their chosen village or town (there can be huge variations in the level of service) to the mid-size, which specialise in one or two popular locations such as London and Devon, to the nationwide 'chain' services. Some estate agents also offer successful buying services despite reservations over conflict of interest.