Advice: Private Sales Commission

Posted 15 March by Dan Ellacott

It’s the final twist of the knife for a lot of people... 
“Why have I got to pay 15% when the park didn’t do anything??” 
The straightforward answer is that if it’s in your agreement, you’re contractually obliged to pay it – that’s why....

If you haven’t got a written contract or your agreement doesn’t mention commission or a sales process, it’s vitally important that you contact your park manager to ask about selling privately. This is an opportunity to establish what the parameters are for undertaking a private sale and whether there will be any commission. 

Make sure that if you’re presented with a private sale agreement, that you read the terms carefully. As stated above, you have are able to assign the pitch and the right to station the caravan. How long this right is, and many other factors will be dependent on your agreement and its terms.

Looking at our sister industry – the residential parks sector – their commission amount is limited by law and is set at 10%. It follows that there will always be a comparable charge within our sector but people still find it frustrating. 

We’re generally ok with paying commissions, so long as there’s an apparent reason for the charge.

Websites like ebay charge decent commissions, but they are providing the platform for the sale. Park owners will probably argue that they’re doing the same thing – after all, your caravan or lodge wouldn’t be worth half as much on the roadside. However, in response to this we would counter that this facility has already been paid for. When you purchased the unit, you would have (in all likelihood) paid over the odds to buy your caravan on a park, sited on a pitch. You could consider that this ‘premium’ has already been paid.

One park owner that we spoke to recently countered that they spend tens of thousands on marketing each year to encourage people to buy their caravans – just one of the reasons why they consider that commission is more than fair.

Either way, and whatever your view point, this remains a core concern for members who are selling their caravans or lodges. 

Our advice is clear – check your agreement and make sure that if you sign anything new, you’re happy with the terms. 

If you need specific guidance – give us a call…