The chief executive of the National Consumer Agency has described as 'incredible' a decision by estate agent Sherry Fitzgerald to increase its commission on house sales in the Dublin area from around 1% to almost 1.5%.
Ann Fitzgerald told RTE radio this amounted to a 50% increase in fees. She said estate agents had had ten years of a 'gravy train' and were now looking for a big increase after just six months of a downturn.
Ms Fitzgerald urged consumers to shop around, but said that if other estate agents raised prices, it would raise questions about competition in the market.
Estate agents say they were able to let fees fall back during the housing boom because of the increased level of activity in the market.
But now they have reassessed what they charge relative to the amount of business they are doing. In other words, the market has slowed considerably, and sales require more work to secure.
Sherry Fitzgerald says it has had to increase the commission to continue to provide a premium service to clients. It says it is carrying more stock than usual on its books because of the slowdown in the market. Commissions outside Dublin are traditionally higher, and they have also increased.
Sherry Fitzgerald chief executive Mark Fitzgerald said the estate agents had responded to the strong growth in house prices by reducing fees, but fees were now returning to the levels of 18 months ago.
He told RTE radio fees had to go up in order for the company to provide a quality service.
Asked whether other estate agents would be increasing commission fees, he said he was not sure, but he had never seen any type of co-operation or organisation between estate agents on price and the market was very competitive.
Lisney said it had no plans to adjust commission fees A spokesperson for the firm told RTE News this afternoon that fees were negotiated on a case-by-case basis, but that no increase in fee levels had been agreed.
