Putting up the "For Sale" sign this winter is likely to throw some homeowners on to a steep learning curve. The first thing they will notice is there is no surge of buyers shouting the asking price and more. They may also note that estate agents are even keener to take their business than usual, due to an exceptionally quiet market. And finally they will encounter some extra costs from the last time they sold.  

A new-look property market

The message of forthcoming stagnant house prices became clearer than ever when Nationwide Building Society published its 2008 market forecast on 16 November. It predicted that the annual rate of inflation will fall from its current 9.7 per cent to 0 per cent by this time next year, which means that in real terms, the price of property will be falling, as it will not be keeping up with general inflation.

The news falls on a housing market that is already looking uncharacteristically quiet. According to the National Association of Estate Agents (NAEA), in October 2004 when the Bank of England base rate was low and the market was still booming, agents had an average of 511 buyers registered on their books. This compares to just 282 buyers in October this year. There is also a wider range of properties on the market for sale, meaning that asking prices are more realistic than ever.

“It’s not that valuations are going down but the final selling price of a property is now lower than it would have been this time last year,” says Chris Woods, managing director of PDQ estate agents, based in West Cornwall. “Of the two prices we give all our customers – asking and selling – it is getting a lot closer to the latter.” In this case it is especially important that vendors think carefully and seek professional advice, says Wood. “Get valuations from three agents and make them work for your business.”

Finding an estate agent

When you have found your preferred agent, find out if they work on a sole, joint or multi-agent basis. This means whether you are tied into an exclusive contract with them or are able to market your home with one or more other agents. You will also need to know the level of commission they charge.

Estate agents’ commission is typically priced between 0.5 and 2.5 per cent of the final sale price – but where your price is pitched on this scale will depend on the contractual agreement, the value of the home being sold and how well you can negotiate the agent down.

Bear in mind it’s not a straight forward case of opting for the lowest commission. The reputation and track record of the agent is arguably more important than half a per cent; after all if your property fetches a high price with an expensive but talented agent, you could still be in pocket.