The Benefits of Using a Search Agent and/or Buyers Agent
A Search Agent and Buyers/Buying Agents are similar concepts and in both cases and differ mainly in the portion of the cycle that they are committed to. In both cases, they represent the interests of the tenant/buyer in the transaction, rather than the interests of the vendor (landlord/seller).
What is a Search Agent?
A Search Agent represents the interests of a prospective tenant/buyer who might be looking for a rental property in London or a property to buy in London and their job is to make use of their experience and contacts and to find the best property for that client. Once they have found the property, their job is complete, and the client takes it from there.
What is a Buying/Buyers Agent?
A Buying/Buyers Agent covers the role of a Search Agent but is involved with the transaction until the conclusion, being completion of the property sale. Their job is to remain involved in the transaction throughout the conveyancing process as well and to see that the buyer has the necessary support until they become the official owner of the property.
In both cases, these agents represent the interests of the tenant/buyer (‘their client’) and their role is to find the ideal property for their client and support the client through the process, until the property is finally rented/acquired. Unlike the traditional agent, they are in no way answerable to the vendor (owner/landlord/seller). The benefit of the dynamic in this relationship is that they are more objective with the process and feedback and are obligated to point out any negatives that they notice or are aware of and not at all incentivised to steer the client in a direction that might not be the best solution for that client. The vendor’s agent’s job is to protect the vendor’s interests, while the Search Agent/Buying/Buyers Agent’s job is to protect the interests of the tenant/buyer.
This relationship is particularly useful to people who are not resident in the UK and who aren’t familiar with the way things work and it is of benefit to them to have someone who does, assisting them in those processes. Settling in to live and work in a new country is very different to having enjoyed several holidays there.
Send Us An Email
The Potential Risks
When a tenant/buyer is dealing directly with an agent being paid a commission by the vendor, they must understand that the agent is incentivised to motivate a transaction on the stock that their agency has been instructed to market on behalf of a vendor and that the agent will apply all their efforts and training to close the prospective client on that stock, because that’s the way that they make their money.
The potential disadvantage for the tenant/buyer, is that they are not receiving objective feedback and could be being steered in a direction that isn’t the optimum option for them. Unfortunately, the negatives might not be apparent to the client, as they might not have been through the process enough times to understand the shortcomings and therefore don’t realise until after the deal is done and they’ve been living in the property for a while and only then do they start picking up on the things that they should have noticed but missed when they viewed and committed to the property.
The Potential Risks as a tenant
This is the less costly scenario, as the tenant is only committed until the lease ‘break’ or expiry and then they can move again. But moving is both expensive and stressful and one must go through the whole of searching again and potentially face making some similar or new mistakes, the 2nd time around.
The alternative to waiting until the lease break or expiry, would be to terminate the lease earlier than the agreement allowed for, but this comes with costly ramifications, in that the tenant would be responsible for not only the agent’s commission (for the balance of the contract and possibly for finding a replacement tenant), as well as any losses that the vendor might suffer as a result, including but not limited to void periods, reduced rental level to a new tenant, etc.
Aside from the stress of moving, the costs involved can range from £300 (renting a van and doing all the heavy lifting yourself) to £1500+ when getting someone else to do everything, aside from the hassle factor involved with changing accounts and addresses and forwarding post, etc., so it’s best to consider all the factors before deciding to commit and avoid unnecessary moves.
The Potential Risks as a Buyer
In this scenario, the potential risks are costlier than in the scenario as a tenant. Without understanding the physical property, the location or property values properly, the client might end up acquiring a less optimal property and possibly even overpay as well. Mistakes can be costly, because aside from the risk of overcapitalising, there are lost costs in terms of Stamp Duty Land Tax paid and legal fees and possible mortgage costs, so if you’ve bought a property that isn’t optimal, you’re stuck with it for some time, or the losses will be significant.
You’re never guaranteed the perfect property, even with outside help, but with the assistance of a professional Search Agent/Buying/Buyers Agent, a client is benefitting from the experience of someone with ample exposure to property in that market, which can help you avoid some of the unnecessary pitfalls and related costly implications that come with transacting in an unfamiliar market.