The Online (hybrid) Estate Agent
The online only (Hybrid) estate agent has for some time now been discussed as the future for estate agency in general. PurpleBricks appears to have taken the lead in this respect, others are lining up behind them to take a slice of the cake, Sir Charles Dunstone, the co-founder of Carphone Warehouse, has invested in HouseSimple, while the easyJet founder Sir Stelios Haji-Ioannou, has launched a site called easyProperty, and only a couple of days ago it was reported,that Hatched the online agent founded by Adam Day, has been sold to high street giant Connells.
PurpleBricks was founded by brothers Michael and Kenny Bruce who ran Estate Agent Burchell Edwards before it’s sale to Connells in 2011, according to a recent news item from Sky News it appears that the online estate agent is preparing to list on the stock market at a valuation close to £250m as early as this December. It was mentioned in the same Sky News report that they had also learnt Purplebricks had appointed Zeus Capital, an investment bank, to take it through a flotation.
I agree that the online (Hybrid) estate agent will probably be a major player in the future of buying and selling homes and letting, however they have to get it right as it could easily become a house of cards. The estate agency business as most involved in the industry know is a cyclical business, good times can be really good but are often followed by an extended quiet property market as has been seen over a number of years. The experienced independent estate agent is very aware of having such good and bad times, they have learnt to plan their business accordingly, as much as we hear of high estate agent fees in good times, little is said when sales drop through the floor and only good management sees the agent survive.
During the “Thatcher” years we experienced a housing boom like no other before it, the Estate Agency business boomed along side it and with that came changes. Building Society’s were awash with funds from floating on the stock markets, they eyed up the Estate Agency business and saw it as a lucrative business to compliment their own, they went on spending sprees buying up small independents and groups of estate agents, it did not take long when the downturn in the housing market came that we would see a change of policy and many society’s realized it was not as simple as it looked, infact we saw sell offs of the estate agency side of their business at a big discount to what was originally paid.
In any business there has to be a positive outlook otherwise one is doomed before they take the first step, there is a saying in the business world “sales are vanity, profit is sanity” that applies to Estate Agency more so than most other businesses, that being due to the cyclical nature of the business, good times have to supplement the quiet times.
Interested to see what Estate Agents views are on this subject.
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