Sinn Féin - On Your Side

Morgan condemns hike in estate agents fees

5 February, 2007

Sinn Fein Housing spokesperson Arthur Morgan TD today condemned the news that estate agents are to hike their fees by as much as 33%, following an announcement by the Institute of Professional of Auctioneers and Valuers last night. Deputy Morgan said such an increase will make home ownership even less accessible to working families.

Deputy Morgan said, "Out-of-control house price inflation has all but priced working families and first time buyers out of the private housing market, with average costs &euro395,000-&euro532,000 in the 26 Counties. According to the Quarterly Housing Statistics Bulletin for March 2006 the average price of a new home in the 26 Counties was up over 11% compared with that period in the previous year. Figures for the same period show a more than 17% increase in second-hand house prices in the Dublin area. This follows steady increases over years, by which the average price of a new house increased by 77% between 1998 and 2003, and the average price of a second-hand home increased by 99% during the same period. Indeed, house prices are now increasing at nearly twice the rate of wage increases. Little wonder then that those public sector workers such as nurses, fire-fighters and teachers can no longer afford to buy homes in our major cities. As well as this the number of mortgage repossessions has also increased. An exorbitant rise in estate agents fees will make home ownership even less accessible to working families.

"If estate agent commission rates rise to 2%, the average fee paid by a house purchaser will be &euro7,000. The estate agents are now saying that they must hike their fees as properties are becoming harder to sell. Surely estate agents realise that if they add an extra couple of thousand or two to their fees, it will be filtered into the price of the house making it even harder again for the purchaser to buy.

"The professional body are using the excuse that Ireland has one of the lowest estate agent commission rates in Europe to up their fees. However, they are neglecting to mention that Ireland has one of the highest costs of purchasing property in Europe. For the cost of a single typical family home in Dublin, you could buy three similar housing units in Amsterdam for the same price.

"The practices of some estate agents may also play a role in inflating house prices. They have a built-in incentive, as they receive a percentage of the amount for which a house is sold. There is plenty of anecdotal evidence to suggest that a number of estate agents use underhand measures to increase the cost of housing and their own profits. This mix of incentive and opportunity is of great concern and requires urgent government action to prevent further obstacles being thrown in the paths of those who are forced to turn to home ownership after years of government policy has resulted in the successful erosion of the social housing system.

"In order to ensure that estate agents act appropriately Sinn Féin is calling for the regulation of the profession and for a Housing Ombudsman with the power to impose a code of conduct, to investigate complaints and to take disciplinary action when fair practice has been breached." ENDS

Connect with Sinn Féin