One of the jobs of any column writer is to prompt a debate among their readership and this happened after my most recent missive went live last month.

It tackled the issue of up-front fees (usually between £300-500) paid voluntarily by vendors at the point of instruction in return for a lower overall commission or fee when the property sells.

As I said in that column, the practice is well established within the industry, but some worry it undermines commission levels and risks annoying the vendors whose homes don’t sell despite the up-front payment.

The practice does have champions, as I have discovered. Step forward Ian Preston, Group CEO of Leeds-HQ’d estate agency Preston Baker… who leads a double life.

As well as leading his busy four-branch firm, Ian spends hours and days every month crisscrossing the nation championing up-front fees via his side-hustle consultancy which, he admits, doesn’t make his family happy. And speaking on the phone to him while visiting a client on the Sussex coast, he is clearly a fervent backer of up-front fees.

Therefore, I felt it fair to give him a hearing given my previous column warned readers to tread carefully when considering this kind of marketing wheeze. Was I right?

The point Ian underscores the most heavily is that up-front fees work and he has the proof, although for transparency his data – based on 2024 sales collated last year – is from his own clients’ and estate agency’s sales.

Nearly 60% of vendors who paid a moderate up-front fee went on to complete

It is impressive, nevertheless. Just 43% of homes he tracked using the traditional ‘no sale, no fee’ model went on to sell. But nearly 60% of vendors who paid a moderate up-front fee went on to complete, and nearly 80% of those who paid a higher up-front fee, also went on to sell. And 92% of those who paid their entire fee up-front completed.

To be clear, I am not being paid by him or his company to write this – I am just curious why he thinks the tactic of up-front fees works better than the traditional model.

Ian, who has worked with 35 brands across the UK including both independents and big corporates, says he appreciates that vendors who pay an up-front fee but don’t sell their home are likely to get testy about ‘paying for failure’.

Many contend that if a vendor has ‘skin in the game’ via an up-front fee then they are much more likely to be active participants in the process and less likely to withdraw or de-instruct.

Failure rate

For reference, official data shows that approximately 40% of all instructions received by agents do not complete but Ian says that, as conveyancing problems stretch sales lead times more and more, he believes estate agents need a different approach if they are to keep their cashflow and pipelines healthy.

So he urges clients to increase their overall fee from 1% to 1.2% and then charge 1% plus a small upfront fee – £400 – to sell but also offer a sliding scale which reduces the overall fee as the upfront fee increases.

“One key point here is that the agreement must include a provision that if the vendor’s circumstances change and they need to withdraw, they able to re-instruct for free within a two-year window,” he says.

“But what this approach does for agents is price in the risk that the instruction may not make it to completion – the ‘no sale, no fee’ approach puts all the risk on agents’ shoulders; remember that in London the failure rate is 65% so some agents are only being paid for one in three instructions.

High risk

“The current way the industry gains instructions and earns its fees doesn’t make commercial sense, particularly in today’s high-cost, high risk environment.”

There is one elephant in the room. Purplebricks tried this and it didn’t end well. Ian’s answer is that up-front fees must be based on a ‘slider’ that enables the vendor to pick the level of risk they are comfortable with, whereas Purplebricks used to fix that level of risk.

Ian has been going at this for a year now and says he’s trained some 500 agents on how to embed it within an agency’s offering. I wish him well.