Market slowdown 'may deter online agency spread'

Ed Mead, a director of London's Douglas & Gordon estate agency and a long-standing critic of online estate agents, says the slowdown in the sales market seen in some parts of the country may deter the spread of internet-only agencies.

Mead says the idea of trying to beat traditional high street agents' fees is not new.

"There's always been a cheaper model for selling" Mead says. In the past For Sale By Owner vendors used newspaper small ads, whille canny sellers have always played agents off against another to get a cheaper fee. "But cheap doesn't mean good" he insists.

"Two words explain why there's been so much interest in online agency recently - 'bull market'. Now the market's on the turn, let's see how many survive" says Mead, an agent for 35 years, mostly in central and south London.

"If a typical home costs £180,000 and an agent's commission is 1.25 per cent, you pay £2,000 in fees - but only when or if the agent sells the property" explains Mead.

"Most online agents charge £500 to £799. Then you pay more for a board, a valuation, photographs and so on. How much do you really save And their fees are payable up-front and non-returnable. Beware Greeks bearing gifts."

He says 20 per cent of his company's sales, even in London and even in a digital age, are from people walking into branches, registering and eventually buying.

And the future "Of course online agents will grow and today's five per cent [proportion of sales handled by online agents] may double. But ultimately people want a service and will pay for it.