The dream of affordable homeownership is common. So, do estate agents list affordable homes? Many prospective buyers question whether estate agents prioritise listings at lower prices. There is a prevailing perception that estate agents cater more to high-end properties because these bring in greater commissions. However, estate agents’ do play a role in the affordable housing market and it deserves a closer look.
Estate agents listing affordable homes
Estate agents play an integral role in the housing ecosystem, serving as facilitators who bridge connections between buyers and sellers across the market. Of course, they will certainly have a financial incentive to focus on premium listings high value listings as the commissions from these can be greater. However, agents also fulfil an important function in listing and selling modestly priced, affordable homes. The proportion of affordable versus high-end homes in their listings can vary based on several factors…
- Market demand – Affordable housing stock may be lower in extremely high-demand areas where prices are stretched beyond reach for many buyers.
- Neighbourhood pricing – In upscale neighbourhoods where property values are inflated, affordable housing stock is typically more limited.
- Client demographics – Agents with clients concentrated at the high net worth end may be less inclined to list affordable options. It will also depend on the brand they’ve built up.
- Commissions – Affordable homes generally yield lower commissions compared to multi-million pound luxury houses, impacting agent motivation levels.
Less commission on offer to sell affordable homes
One of the critical challenges agents face in taking on affordable home listings is that these properties offer less lucrative commissions. According to TheAdvisory the average commission rate for a UK estate agent is 1.18% plus VAT. Depending on the estate agency brand, this fee can be higher or lower.
This economic consideration can affect the effort and resources agents devote to marketing and selling affordable homes compared to high value properties.
Lack of affordable homes for sale
Likewise, the exceptionally high buyer demand combined with low inventory for affordable UK housing means more budget-friendly properties often sell incredibly fast. In some cases sometimes even before making it to the formal listing stage. This rapid turnover rate and whirlwind sale timeline can create the impression that fewer affordable options are available through estate agents.
In reality, it is more an issue of timing and how quickly affordable homes get snapped up rather than an actual lack of affordable housing opportunities overall.
Get a head start when looking to buy your affordable home
For buyers focused on finding an affordable property, partnering with the right estate agents can make the search process more productive and streamlined. Here are some tips to start with…
- Be upfront from the very start about your maximum budget and criteria for an affordable home. Communicating this helps align you with estate agents who understand this and can inform you when the right homes become available.
- Request to be notified about any new affordable listings that match your search criteria as soon as they become available. Given how quickly affordable homes sell, you need to act quickly when options arise.
- Get a mortgage agreement in principal. This demonstrates to the agent that you are financially ready and serious about purchasing, making you a more attractive buyer.
- Although estate agents act for the seller, making sure they know who you are means you are at the forefront of their mind if homes become available matching your needs.
- In some instances based on the relationship you have with estate agents it could help you to be first to see new homes matching your criteria which means you get a head start if it’s a home you’re interesting in buying.
Government policy for affordable housing
Looking ahead, the affordable housing landscape continues to evolve based on government policies, economic conditions and housing market trends. There is also growing recognition of the urgent need for more truly affordable housing, especially for first-time buyers. Over time, this could motivate more estate agents to expand their focus towards catering to first-time and budget-conscious buyers.
Making affordable homes attractive to sell
Some other measures that could help agents direct more attention to the affordable segment include:
- Offering higher agent commission rates for affordable listings to improve motivation.
- Partnering with developers building new affordable housing communities.
- Running special first-time buyer open house events to connect with this demographic.
- Leveraging social media and digital marketing to promote affordable property listings.
Despite the challenges inherent to this market segment, Estate agents play a valuable role in listing and selling affordable homes.
Buyers can get on the front foot to find affordable homes coming to the market
Buyers can optimise their affordable home search by understanding agents’ motivations. They can also leverage their knowledge and resources effectively.
Though complicated at times, you can navigate the affordable housing market. Make sure you are as prepared as you can be and are in touch with local estate agents should new homes becoming to the market that match your criteria. For the many seeking the dream of homeownership, estate agents remain an important ally to guide you through this process.
Take a look to see affordable homes for sale now.