Is your estate agent underwhelming you, yet charging the earth?
Let or sell your property for less.
I’m often reading agent blogs, warning of the dangers of using low cost or internet based estate agents citing examples of how customers have lost money using agents whom have no obvious office and are therefore not able to be contacted directly.
Without feeling the need to name anyone, I hear stories everyday from tenants and landlords that involve some of the most reputed names in the high street – and how they have been treated, or their hold fee wasn’t returned to them. Having an office isn’t a determining factor of whether a Companies behaviour is unscrupulous I’m afraid.
We do not hide the fact we work from a residential address. In fact its mine, where I live with my family. And its probably a good reason why we’ll never be accused of acting anything even remotely dubious in nature.
Pay peanuts get monkeys
We’ve all heard the saying. It suggests that the quality of service, product or work is directly related to what we pay.
Many high street agents use this line in their defence as to why they charge a whole lot more than office-less internet based agents. In fact a high street agent used this line to one of our extremely satisfied sellers recently.
After seeing our board outside the sellers house, he decided to send a letter to the owner. The owner – whom we had built a solid relationship with (which you would do if you had secured a buyer willing to pay £30,000 more than the RICS valuation) decide to call the agent, albeit in an abject mood.
The agent had assumed after looking on our website at our typical fees that our service would be low quality. He obviously didn’t consider that we are NAEA qualified, have many years experience in the industry (quite possibly many more years than himself) and as a reasonably new Company would work especially hard to ensure we worked sufficiently hard to prove ourselves in a tough market place. He also probably hadn’t thought that as a reasonable small firm without huge running costs, such as too many staff, cars, larger than actually required offices, our overheads we’re actually quite low and therefore our fees could reflect this.
His comments to our client that he would ‘get monkeys if he paid peanut’s’ was met with vitriol.
In research carried out by Dan Ariely – professor of behavioural economics at Duke and author of Predictably Irrational: The Hidden Forces That Shape Our Decisions – it was found that offering more money to individuals to complete a task can actually decrease performance.
His research might possibly offer an explanation as to why some agencies charging very high fees have a complacency about the way in which they conduct their business. Its certainly food for thought.
I’m not suggesting that there isn’t some truth in the age old saying – you certainly will hit a point where its not possible to offer a quality service if your fee is too low. What I am suggesting is that a service can be great, even exceptional and better value at the same time. Think Amazon, or Dell. Both of these Companies regularly exceed my expectations. Even John Lewis is ‘Never Knowingly Undersold’, and their service is always first class in my experience.
Tenants have been found for this lovely flat in Honor Oak Park in London SE23. It was only on the market for 3 days and the asking price was met.
The Landlord decided to use our £295 plus vat service. Compared to the other local high street agents that he’d invited for a valuation he has saved over £1052 in fees. He is also naturally delighted.
It’s an interesting subject James. I, as you know also run an ‘online estate agency’. We also experience a bit of prejudice from the local ‘high street’ agents, they see us a threat as they can’t compete with us. They are losing properties to us on service and on fee. (Before anyone starts on the fee, we don’t just charge low upfront fees, we also offer a no sale – no fee comparable with what other agents charge)
There are good online agents and there are rubbish ones. This is also true of high street agents. As you have said a low fee does not mean a poor service. Eventually, I think online will be taken out of our title as I feel all agents will trade off the high street. We are all estate agents after all, the majority of my clients call me an estate agent not an online one. Where has the ‘online’ tag come from? Has our industry manufactured it?
Tom you make some good observations too. The online tag seems to be the current justification to not having a client facing office. We function just as well without one as with one (and we have worked in high street locations before). In fact you really don’t need one for the job, although it clearly has benefits in attracting sellers and landlords. Unfortunately many potential clients think less of you for not having a customer facing office, as if its going to somehow affect the quality of your advice or efforts. If that really were the case, then I would love to hear the reasoning behind some of the frankly embarrassing property adverts I see listed by national brands. Its almost contemptuous to make such whimsy efforts to try and make the most amount of money for the least possible effort.
All agents are online, as its where almost everybody find their property nowadays.