There can be nothing better suited to the internet than property, and hits to property websites far outnumber those of any other industry. The ability to be able to search in the comfort of your own home, usually without having to provide any personal details, is certainly attractive and has transformed the way the public begins to look for their new home.
So will the internet replace traditional estate agency? It would certainly seem not. Ultimately property search portals are regarded by buyers and tenants alike as a supercharged local property newspaper, with a fairly comprehensive selection of homes on offer.
As many sellers have discovered, the benefits of using an estate agent far outweigh the simple ability to source a buyer or tenant. In some ways, finding the buyer or tenant is the easy bit!. The internet certainly helps the agent to do this, which in turn frees up time to be more proactive in helping those “home-seekers” identified as being particularly motivated. At the same time, those who are “just browsing” need not feel neglected as the internet will keep them happy for hours on end, and might even prompt them to take a more positive step towards moving.
The internet cannot advise on detailed property matters in context, cannot interpret the market, cannot provide strategic marketing advice, cannot negotiate, cannot hold a chain of related sales together, cannot chase solicitors, cannot understand a survey, cannot accompany buyers and tenants around property, cannot encourage people to view unexpected properties or help overcome initial hesitation, cannot prompt a decision, and cannot provide reassurance when things go wrong.
When it comes to so-called “on-line agents” there is often more to consider than may first meet the eye. Firstly, all agents are on-line, at least this is the case for all those who promote their properties through the likes of Rightmove, Zoopla and primelocation. What differs greatly is a local presence on the High Street and the way in which the business is set up, to handle all aspects of the selling or letting process. Having an easy to find, “open door” office location means guaranteed access to the estate agent – you know where to find them as and when you need to – there’s no hiding behind websites, e-mails or mobile answerphone messages.
The High Street agent is paid when the job is done. This can result in many hours of time and energy, often for no reward e.g. a sudden change in client circumstances resulting in the property having to be withdrawn from the market. The incentive for the High Street agent is clear – succeed or suffer a loss of time and money.
The on-line model requires that the seller/landlord commits to paying a fee regardless of whether the outcome is wholly satisfactory or indeed successful.
The High Street agent offers a local presence, employing a team of property professionals with localised expertise. As part of their overall salary, the selling and letting teams receive a performance related commission on the basis they succeed.
The so-called on-line model employs individuals, who whilst referred to as a “local property expert” will invariably cover a very large area. If the person appointed to service that area is out valuing houses all day, how can they genuinely offer an effective and personal aftersales service? They are commission hungry individuals, paid for each seller or landlord they sign up, and there are only so many hours in a day. If faced with the choice of spending the next hour trying to sign up another client, so as to earn another guaranteed commission, or instead taking calls from those who have already committed to paying the fee, which option do you think they will choose? What if they are not paid a basic salary, only commission (as many are)? Could you really blame them if they focus their time doing what it is they actually get paid for?
The High Street agent provides a full service, covering all stages of the process, and as mentioned already they are rewarded on results, not listings or viewings. Most people have a pretty clear understanding as to what can be expected from a traditional High Street agent, but is this the same when it comes to on-line agents?
The on-line agent seeks a guaranteed fee, which is, in most cases, payable upfront. Then there are added extras which, for many sellers and landlords, are seen as standard expectations e.g. accompanied viewings, which given the fact the people viewing your property are strangers, we think is a must. The cost will usually increase further unless the client agrees to use a specific conveyancing company, often based miles away from where the property is situated. This can result in the lack of understanding on localised issues, issues that unless properly understood can cause delays.
When it comes to finding out what is happening, you may have no alternative but to log in and check for yourself, either that or communicate with somebody who is not even directly employed by the agent you have paid! With a High Street agent you can simply pop along to the office and talk with someone (you may even get a cup of tea).
The High Street agent will pay salaries to a full team of staff, along with paying business rates and other associated running costs (even during the slower times such as the summer holiday season and at Christmas/New Year). It’s a case of planning a business model for the long term, and by offering secure employment to a large expert team, who are capable of providing a full and all-embracing service, the High Street agent can retain their staff and in turn build a strong business with a growing reputation for excellent service and client satisfaction.
A question was put to me the other day – “is everyone in the industry thinking long term?” Some of the on-line models are making losses at an unsustainable level with a focus on branding, crowdfunding and even flotation on the stock exchange. There seems to be a lot of “buzz” surrounding tech companies at the moment and plenty of articles doing the rounds suggesting many could be caught up in a “new bubble”…. if this is true, let’s hope it doesn’t burst and see a repeat of the dot-com era!
I’ll leave you with one last thought. If your local High Street agent offered a service where you pay them a guaranteed fee for marketing your property, on the basis you cannot visit their office, instead having to contact them by telephone, which they may not answer because their days are filled by signing up new clients….would you give them your instruction?? Maybe the High Street agents have got it wrong, maybe a percentage of the public actually want a “no sale pay the fee anyway” type of service. However, I am confident that most vendors want to achieve the best price, moving to a timescale which suit them, and with minimum stress.
Estate agents will always look to adapt to customer demand and it’s fair to say their lives would be far easier if guaranteed a fee for every property they were instructed to sell or let. However, if their fee income wasn’t linked to successfully selling or letting those properties, could there perhaps be a decline in both customer contact and the time and effort invested into each property sale – risking a lower standard of service and thousands of frustrated potential movers…..