Helping hand
A legacy of Britain's property boom of the past has been the proliferation in buying agencies, sometimes called property finders.
Unlike estate agents, which represent the interests of sellers, property finders help buyers. Following a client's brief, they find a suitable home and negotiate its purchase for them. In addition to residential properties, some search for land and commercial premises. Hong Kong and other overseas buyers sometimes hire them.
'It is not just about finding a property, it is about evaluating a property and then negotiating a good deal on it,' says Tim Hammond, chief executive of the Association of Property Finders and Buying Agents. 'It is about giving the buyer professional representation.'
Buying agencies first appeared during the 1980s property boom, and mushroomed during the 1997-2007 property bonanza. According to the association, Britain has 300 to 450 buying agencies. Most are one-person outfits covering individual towns or counties, some are companies employing dozens of staff. The largest, Property Vision, was also the first. Set up in 1983, it has 70 employees.
Some estate agencies have set up buying agencies. Prime Purchase, which is linked to Savills, and The Buying Solution, set up by Knight Frank, cover large parts of Britain.
Many buying agents are former estate agents who use their contacts in the property world to unearth properties before they come to market. Typically, a buying agency will charge an initial search fee or deposit and a success fee, based on the value of a property, when a purchase is made.
Based in Newbury, Berkshire, Middleton Advisors helps executives find homes in southern England. These include Britons moving back from Hong Kong. 'We deal mainly with expats looking for country homes,' says Tom Hudson, partner at Middleton Advisors. 'Seventy per cent of all the deals we do are private, for properties never coming to market. This is relatively common in the GBP3 million [HK$34.15 million] bracket we operate in.'
The firm charges a GBP2,750 search fee, plus VAT, and a 2.75 per cent success fee, plus VAT.
In London, Mayfair-based Black Brick has been finding multimillion pound homes for clients since 2006. Its fees are negotiable. Black Brick's managing director, Camilla Dell, says buyers need property finders to help them negotiate deals in a competitive environment. 'It is a very tricky market for people to buy a property without professional help,' she says. 'It is hard to gauge value, because so few transactions have taken place. Buyers who bid too low, like 25 or 30 per cent, won't be taken seriously.'
London-based Property Hunt helps buyers find residential and commercial property, including hotels. It charges an initial GBP1,000 deposit, plus VAT, and a 2 per cent success fee, plus VAT, minus the deposit.
The association has set up an online service to help house hunters find a buying agent, at findabuyersagent.com.
The Association of Relocation Professionals has buying agencies among its members.
