Are homeowners falling out of love with online estate agents?
Online estate agents have certainly made a big splash in the property market. You only need to turn on your TV to see an online estate agency advert, or walk down the street to see their ‘for sale’ boards outside a home. As a nation that has spent many years criticising estate agents, it’s no surprise that a money saving ‘do it yourself’ model was a welcomed change. Then came the best of both worlds – a hybrid approach that combined the online experience with the support of regional estate agents.
There has been a lot of debate about the different approaches. Some have criticised hybrid estate agents for lack of local knowledge and others have criticised traditional estate agents for charging too much commission. At the end of the day, surely it’s simple. Homeowners will be happy if their property sells.
With this in mind, it’s interesting to hear that recent research conducted by the estate agency comparison website GetAgent, found that half of online agent listings hadn’t sold after a 14 month period.
The same research showed that many homeowners who chose an online/hybrid agent in the first instance, later switched to a traditional high street agent to sell their property, and it didn’t take sellers long to do so. Almost half of vendors who switched from one top hybrid estate agent did so in the first two months. And out of those properties re-listed, 65% had asking price changes. It does seem that homeowners were quick to lose faith in the online model.
It’s of course, not unusual for homeowners to choose more than one estate agent to sell a property. However, online agents encourage sellers to pay an upfront fee regardless of whether the property sells. Over 80% of those interviewed chose to use an online or hybrid estate agency due to the perceived cost savings. If the property sells then the upfront fee is a much cheaper alternative to the usual commission % taken by the traditional estate agents. But the big worry is if the upfront fee is paid and the property remains unsold.
GetAgent interviewed one online agent customer;
“I came across the hybrid agent online and I liked the idea of saving money. I did not like the idea of conducting the viewings myself so chose the full packaged service. However, I found there were a lot of communication issues and I had to ask them to redo the photos they took because the quality was so poor.”
What’s also worrying is that if homeowners are using both online and traditional, surely they will then have to pay the upfront fee to the online agent AND the commission to the traditional agent- definitely not the way to save money.
Homeowners were crying out for a change and online agents have definitely disrupted the market. However, it’s too early to tell whether online agents are a better way for homeowners to sell their homes. With over 15,000 estate agents in the UK, you can’t help but think adding more to the mix will just confuse homeowners further. Perhaps homeowners don’t need more estate agents to choose from, and instead they need help distinguishing between the good and the bad from those that already exist.
GetAgent CEO, Colby Short:
“Homeowners should decide which estate agent to use based on their performance. How many properties they have sold in that area. How quickly they have sold them. How close to the asking price they were sold for. With this information, homeowners can feel more confident in their decision making and make sure they end up with an estate agent that suits them”
Research overview: analysis of 500 new listings by Purplebricks and all listings by Tepilo, Housesimple and Emoov posted in January 2016. Analysis period: January 2016 – March 2017. Data source: Nielsen, Land Registry, Zoopla, Rightmove and our very own GetAgent questionnaire.
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