Do Internet Agents Really Threaten Traditional High Street Firms?
I’m not sure anyone has actually claimed internet estate agents are taking over the world? We see ourselves more of an estate agency, that has chosen to conduct our business without using a high street retail office. Mostly due to the fact they are often hugely expensive (especially in popular town locations) and they also tend to limit you to conduct your business in a pretty specific location. The internet has developed and it now offers businesses the opportunity to attract custom through various advertising channels, without having to limit their offering to a specific location.
Every week another high street agent blogs about the fact online agents are not quite taking over the world (estate agency industry, that is) and never will. I’m not sure anyone but the press suggested they would?
For starters, most online agents (us included) promote services whereby the seller conducts the viewing with potential buyers. Clearly this arrangement will not be for everybody. I mean, some properties are vacant, so the agent really is the only option even if the seller really didn’t want to use one.
Office-less estate agents offer a genuine alternative. Some homeowners who are in-residence are happy to show potential buyers around their home because they value the cost saving more than having to give up just a little of their time.
Just today I read another prominent London agents blog about how internet agents are seemingly run by those who know nothing about the art of selling property or registering a Landlords deposit effectively.
Valuations: Apparently only ‘genuine’ estate agents with offices can do this properly. If you don’t have an office, you’ll have no idea how to price a property.
Our opinion: So that’s why so much stock is currently waaaay over-priced and going nowhere fast. Which? magazine just recently reported such a disparity with valuation prices when they surveyed a group of ‘leading agents’ that it begs the question, who is actually right, and which agent got it horribly wrong? Some properties attracted valuations that were different by as much as £150,000!
For the public: Remember that estate agents are not ‘qualified’ with a City & Guilds in ‘how to value properly correctly’. They guess the value based on other similar stock available , market trends and sold prices. In fact I’d bet the majority of reasonably savvy home-owners could take a guess of their property’s value that’s pretty much on par with any agent. Don’t think agents know more than you, as often they don’t. When you buy a property you don’t pay a price because the agent tells you to, because you’ve already done your homework, haven’t you?
Building rapport with clients: Apparently you can only really service a client effectively if you can meet them and ‘suss’ out whether they are genuine or not.
Our opinion: You certainly have to work harder to build rapport if you don’t meet in person, but it can still be done over the phone. Rapport is built from your ability to listen and then action. You don’t have to sit in front of a person to listen to their needs effectively. The ability to service a client properly is the responsibility of the agent handling the task. Those more skilful at it, certainly don’t need an office or even to meet their client in person. I have fantastic relationships with scores of clients I’ve never even seen (save for a passport photograph!).
For the public: Being able to point out places of interest, stations, schools, local tradesmen and much more isn’t going to sell your house more effectively. And anyway, you can do that bit far better than any salesman could. And (for buyers / tenants) do you really trust a salesperson of any kind? Estate agents are not advisers, they are ‘negotiators’ acting on behalf of their client, at heart always trying to increase your offer (or obtain a better one elsewhere). Whether online or office based, they all have the same objective.
Not many internet agents subscribe to any form of regulation: There’s a distinct difference between an internet estate agent and a website that allows you to add your property to Rightmove’s list. The better internet agents are compulsory members of an OFT approved estate agents redress scheme, because the law changed in October 2008. They are also NAEA accredited (as we are), meaning they subscribe and adhere to the principles of the National Association of Estate Agents. They also usually have many years of experience in the industry.
Our advice: If you are dealing with any agent (whether office based or not) who is not a member of a redress scheme, we recommend you make your excuses, then leave.
For the public: Unfortunately whether the agent has a fanciful office or not is zero indication of the type of business you are dealing with. I’m sure the landlords that placed their trust in the numerous high street agents throughout the UK who went into receivership having spent their landlords tenants deposits had only confidence in the businesses when they instructed them to do business in the first instance. Unless you are actively able to audit the agents accounts before making a decision to use them (or are a psychic), you are effectively speculating that the agent will remain solvent if you allow the agent to hold your tenants deposit using an insurance backed Tenant Deposit Scheme. For the record, even though we have a ring-fenced client account and insurance, we still prefer to use The DPS (the custodial scheme) as it means even if we disappeared, your tenants deposit wouldn’t!
So there you have it. We’re not for everyone, and we cannot pretend to be able to effectively handle viewings like a high street agent. But we’ll do everything else just as well regardless of how many high streets get on their high horses suggesting otherwise. We’re office less agents, not a lesser breed of uneducated types.
fishneedwater offer services to sellers throughout London who think they can manage the viewings part (which is actually really easy) in exchange for a great value for money fee (which is whole lot less than a high street agent). We work just as hard, and just the same – but without doing the bit where we drive to your house to meet potential buyers. Because you do it for us.
fishneedwater arrange for a RICS valuation before marketing your property to help decide the best strategy to attract a buyer. A RICS surveyor is a the type of person who values a property for a mortgage lender, and they assess a property value simply by calling a local agent.
Our opinion: If RICS surveyors arrived at the property value simply by calling a local agent , then we’d have a pretty decent market right now and you’d be forgiven for thinking it was Novemeber 2007, looking at some of the property asking prices.
Its a good piece that you have written here. High street estate agents are threatened by online agents, as deep down they are fully aware where most of their business comes from -Rightmove and the other property portals. I am a traditional estate agent who now trades in the virtual world through choice. When i first set my online estate agency up, i could quite easily have gone out and got a high street premises. I decided against this as over the last few years we have seen the internet lead the way in the marketing of properties. In addition to this, if an estate agent is based on a high street in a paricular town they will only get properties in that surrounding area. The beauty of being an online agent is you can literally go anywhere! There is space for both models. It is not everybody who will use an online estate agent, but we are becoming popular as people realise that we are excellent value for money.
Thanks for the comments Tom. I agree, on-line agents (or let’s call us estate agents without a high street office) are not for everyone, especially those that really require the agent to handle the viewing bit.
However the sellers we have attracted so far haven’t found doing this a chore at all, and some of the comments have been that they’ve actually found it interesting.
If a property is attractive in price, decor and in it’s marketing, it does almost sell itself. You just need to make sure the buyers that you send are properly vetted and meet the sellers criteria.
If you property falls into this catogory, and you reside in it, why would you want to pay a high street agent up to 2%?
I’m sure eventually the public will realise there is a much cheaper and just as effective way. Even if it takes the new generation to realise it.