Online Estate Agents?
Firstly, and the most obvious, In every town across the UK, there are high street Estate Agencies. Great protection for consumers, they know who they are dealing with and where to go locally with problems, issues, concerns and complaints.
Recently, some people have become confused whether they are dealing with a reputable high street agency or a person who is operating from their bedroom, who has never been an estate agent or valued a single property in their life.
People, dealing with their biggest asset want to know they are dealing with an established, local and professional firm. They want the personal service, attention to detail and individuality required, specific to their personal circumstances.
There was a time, cost cutting to the bone, meant everything resulting in call centers in India and other parts of the world adding to the stress of returning a DVD for example. If the industry goes online, cutting fees, so I have someone in India trying to sell my house or a person operating from their back bedroom with little reputation. Personally, I would hate this. The high street agencies are extremely competitive. The majority of online agencies are gone within one year. So fee cutting but at what cost?
The benefits of a high street agency to the consumer? I know who I am dealing with. I want the reassurance I am dealing with someone who has experience, who is professional, who can conduct themselves appropriately, who is established and knowing 20%, one fifth, of our enquiries are generated from our office locations producing more buyers and tenants. A full service, not a part service.
The online agents don’t do anything apart from listing a property and creating an advert. A REACTIVE service. A real agent will speak to all their staff being PROACTIVE in calling prospective buyers, going through their database, bulk emailing buyers, texting buyers and actually selling the property, not waiting for someone to call. There is a big difference.
I agree, it’s not for everyone. Some people want to save five hundred pounds, for example and take the risk of using a new, recently opened agency in a town (who has no database of waiting buyers and tenants) not established and take a risk, but that’s the consumer’s choice. Fortunately, normally they don’t pay a penny until sold but now, people are paying £600, losing this because they still need to go to a real Estate Agent to sell their property.
For years estate agents have wanted regulation and industry exams / licensing. The Government ignored the industry, like the failed Home Information Packs they forced on consumers. For years, Stamp duty goes from 1% to 3%, with no 2%? There is no logic to be found here. Its been up to the industry to protect the consumer and build up the reputation of the industry.
Secondly, and more importantly.
Yesterday I reviewed a new online agency, a typical online agency opening within the last couple of years. On the website, it states, ‘Find out what your home is really worth’? I enter my postcode and a detailed report is sent to my email. This morning at 8.53am, I receive a phone call from the franchisor who has bought the Bournemouth area territory, who has never been an agent before, never professionally valued a property in his life. Call me and say, the valuation has come out at £263,000, slightly higher than Zoopla but having carried out research feels the property is worth £11,000 more. The email was sent this morning stating a valuation at £273,000.
I can see some of the data is being produced by Hometrack. (Sorry I have picked on this particular online agency, I do not know the company or the individual, apart from the fact I know he has no experience). However, having been an agent for over twenty years, I can tell you my house is worth £375,000.
This is an eye watering one hundred thousand pounds out. Why is this type of valuation so out and frankly dangerous? I bought the property as a three bedroom with no parking and no kitchen. I have extended the property to be a four double bedroom, three luxury bathrooms, installed gas central heating and double glazing, refurbished the house and managed to make off road parking for two cars.
Incredibly, this individual told me my house is worth £11,000 (which is quite specific and an exact amount) more than the online valuation and further produced a written report confirmed the valuation, without even seeing my house.
Its only a matter of time before people are badly ripped off or losing tens of thousands (in my case, a hundred thousand pounds) through negligence. The opportunity to rip people off has increased and I’m sure the media with report a headline, ‘Estate Agent rips off …’ rather than ‘Online Estate Agent rips off’
In relation to property portal valuations, their online valuation is making my job harder. Providing a valuation cannot be taken so blaze and lightly. This is a very big responsibility, I panic when I think I’ve lost someone a thousand pound, let alone 100,000 or ten thousand. In any industry, someone with a little knowledge is dangerous, you just know, big and dangerous mistakes will be made.
Here are some real life examples. Remember, tens of thousands of pounds are life changing amounts of money.
A house is worth £210,000, after 14 weeks on the market it finally sells. The brother of the owner goes on Zoopla and tells the sister, she is under selling and the house is £250,000 according to Zoopla and pulls out of the sale. It’s a ridiculous price and the lady has to move, she has to sell. What a waste of everyone’s time, it’s a 20% difference. Its still not sold and the price in coming back down.
Similarly, I valued a property at £164,950, an online agent valued at £150,000 to £155,000. Which I completely understand because no one had sold or moved home on the road for over two years, so the comparable properties were low. I sold this house for £164,000, the surveyor down valued to £155,000. However, the seller paying me £2,061+ Vat, used by experience, expertise and professionalism to finally sell the property for £162,000. I paid for myself over and over again. The owner came away with a price the property is worth in today market.
The thought of an online agent working from his bedroom, giving advice without knowledge, simply guessing directly to consumers, is a very scary and dangerous reality. I would say online agents can still use Rightmove and Zoopla and the consumers can still use Rightmove and Zoopla but only Independent high street Estate Agents can use OnTheMarket.com.
So, in conclusion, its nothing new, even before the internet people tried to sell through private newspaper adverts. As an Estate Agents /Marketing Agents, I spend well over £8,000 a month in marketing and generating hundreds, if not thousands of enquiries every month.
More Enquiries = More Viewings = More offers = Sells for the BEST PRICE for clients.
Clifftons Estate Agents Tel: 01202 789699.
Posted: 24th October 2014