Letting agent takeover

[Sandyppp]

We've had an offer accepted on a high end apartment in North Devon. We've been in discussions with a local agent since the start, but nothing signed yet. They're offering 15% for 2017 and 18% for 2018, or 16% until end of 2018 as we won't get to market until early summer this year.

Yesterday I got an email saying that they were merging with Sykes and how wonderful this would be. Obviously they're much bigger players and I rang them as a prospective owner and their fees are 18-22% depending on how many private weeks we have.

The agent has also put the wind up me by informing me they've been given the contract of the apartment next door to ours (new build), they're obviously keen as their offer was accepted after ours. They're painting it as a huge advantage to have 2 apartments in the same block, but is it really?

I'm mew to all of this. Any advice would be gratefully received.

[kg1]

Sykes seem to have the reputation of down selling, according to others who have ditched them they will fill your property at any price just to get some commission rather than none. If that suits you, fine, but you may prefer less wear and tear on your property. I'm sure if you search Sykes there will be dozens of posts on here about them.

[newtimber]

There's no advantage for an owner at all of having 2 properties in the same block with the same agent. The advantage is with the agent as their advertising costs will be less and their performance won't be able to be compared with the competition.

If your property is high-end, then you want to be listed with agents that list high-end properties because that is where people searching for quality will be looking.

Get a few agents round and ask for their opinion on rates, fees etc.

[greenbarn]

By way of a comparison, you’re just about to launch a high-end product and on the point of engaging a retail outlet that fits your intended market positioning when they tell you that they’re about to be taken over by Poundland.

Do you proceed?

ps I don’t intend to draw any direct comparison between Poundland and Sykes. I’m not aware of Poundland having a bad reputation for their ethics in treating their Customers.

[Sandyppp]

Thank you to everyone who has replied, it's really helped. The original agent was pretty high end, and had actually given us lots of advice on how to furnish it to attract the right clientele, but I think they must have just seen a lovely takeover fee from Sykes and lost sight of their original ethos.

Some of the posts I've seen about Sykes have been horrifying. I'm just off to do some more digging about on other agents. Our mortgage company are requesting that we get Marsdens to prepare a report of what our projected lettings will be. Has anyone any opinion on them?

[Cymraes]

Sykes will also be charging 20% VAT on their fees so you need to add that on too

[russellt]

I’m not aware of Poundland having a bad reputation for their ethics in treating their Customers.

haha very good.

[russellt]

a lovely takeover fee from Sykes

Just another thought on this. In fact, a question on the state of the market for small/local agents. Are they feeling the squeeze more than normal?

The reason I ask for opinions is that, as part of my new 'book direct' venture, I am being contacted by small local agents who wish to register. It seems kinda strange that they would want to register on a 'go direct' site, but reading between the lines, just like many independent owners, they are unhappy with the changes being made by the OTAs. However, they are also facing an onslaught of 'go direct' initiatives, and owners who wish to do it themselves.

Are the small, local/niche agencies being squeezed out? Or possibly having to change their business models to make themselves appear less competitive to the 'go direct' crowd?

[charles cawley]

Had we not focused on quality, we would no longer be here.

The big booking agents are mainly part-service with better levels of service from Wyndham Worldwide and even Sykes compared to listing sites - turned Agents which are trying to get money from each end without doing much work for it.

Full service agents tend to be best when based locally to the cottages. The reason why we have survived is similar to the reason why specialist food shops, grocery shops and high quality suppliers survived the onslaught of the big supermarkets.

If you want a really good service as an owner or, as a guest, you want to see a quality choice without having to trawl through a vast variety, small high focus quality local booking services will always be attractive.

A medium sized booking business tried to take us over. I was shocked at legacy attitudes. They called owners' properties 'stock' as if they owned them. Attitudes towards owners were equally dated and negative.

A good agent should never forget they are, in effect, employed by owners. They have a duty to owners and guests to make the process of booking, if possible, part of the holiday itself.

Many small agents sell out to large operations because the absorption value is radically more than the value based on profit. A large operation can easily absorb and dispense with the vast majority of overheads turning a significant chunk of gross commission and booking charges into pure profit.

Legacy attitudes are still current across the sector. As a small operator this does us no harm at all. But I still get quite upset when I come across them.