Hunters defends £500 buyer fee
Hunters Property Services has defended a £500 fee it charges house buyers to secure their offer.
As part of its terms and conditions, Hunters includes an offer price deposit agreement stating that the York-based firm will take a £500 deposit from buyers, which it holds in a client account pending completion of legal contracts in relation to the proposed purchase.
The fee is returned upon completion of the deal, but in the event of a buyer withdrawing from the purchase, the balance of the deposit that remains after deducting all administration charges and expenses relating to the withdrawal, will be returned.
Kevin Hollinrake, managing director of Hunters, says: “The deposit was introduced in city centres, where investors were chopping and changing deals, with no sentiment for the property involved.”
“We don’t get a big buyer resistance to it, and if we did, we would speak to the vendor and ask them what they wanted to do. In some cases, vendors won’t take their property off the market until the deposit is secured.”
Hollinrake insists that the fee, which was introduced around three years ago, is only taken from the best buyer offer received for a property. He claims that his vendor clients receive an average of four offers per property, and that around 17% of the firm’s sales fall through.
Property ombudsman Christopher Hamer says: “Whilst I do not normally comment on commercial decision, I remain uncomfortable with the approach, which sees an agent earning commission from his client, but also apparently receiving a fee from and entering into an agreement with a prospective buyer.”
He adds: “If it was a pre-contract deposit, then a ‘lost’ sale would see the money being paid to the seller because he is the one who has been disadvantaged. But in this case, it appears that the seller is not party to the agreement to take a deposit.”
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