Making my way to our London office on a busy commuter train, my mind got busy thinking about the new do-it-yourself estate agency option offered to property sellers.
I have been clear in the past over being in favour of giving consumer choice and that there is no one fit-all solution.
However, I was trying to think of any product at all - and I mean any - that people can ‘buy’ on the internet. This product would not require: proof of funds, some form of actual immediate commitment, a delivery timeframe, or additional stakeholders to validate and legitimise the purchase, taking up to five months to process.
If you can think of any online transaction that is similar to that of the experience of buying a property please tell me, because I can’t!
Oh, and if you are thinking cars...no, I’ve considered that one - you need to put down a deposit or holding fee.
So here is my thought process…
Amazon, Ocado, Expedia and others, are all hugely successful businesses in the online space merging speed and convenience. People go online and buy because it’s an instantaneous process.
I seek, I discover, I acquire...delivery on average in 48 hours. Although, same day delivery is now possible. Let’s not discuss that a recent survey indicated that returns of clothes and footwear via online purchases are at almost 50%!
These companies have fundamentally changed the retail experience and consumer expectations of service delivery. They need to be in control. It has to be instant, convenient and efficient.
The need for a consumer to visit a high street or superstore to identify a suitable purchase and to take it away with them is no longer the only option. Non-human interaction facilitates the identification of stock, its availability, and delivery function.
But buying a property is simply different. It isn’t retail. It NEEDS human interaction and always will.
And while it is true that the interaction could be directly between the buyer and seller, it removes the element of knowledge and expertise of an experienced and trained estate agent.
Who will make sure that the seller gets the best price for the property? Not all sellers will know how to negotiate. How many sellers will know how to qualify a buyer?
Who will make sure that the sale is progressing, ensuring that there is no break in communication when dealing with chains, which can easily lead to fall throughs?
Who will help buyers find their perfect home? I sold properties to buyers who hadn’t requested to see a particular property because they didn’t like the look of it online, but fell in love when I suggested to take them for a visit anyway.
And so here is the point: Technology is only an evolution in the methods of interaction with customers, not the end product.
Technology doesn’t fulfil the transaction, people do. It may help it as a method of communication in the same way a fax machine did in the 1980s, but it is still a people business.
Agents need to communicate this robustly and articulate the reason why a traditional agent adds value. If you can’t, why should a customer pay more for something that they perceive to be the same or less? And we all know this isn’t the case, but perception is reality. While agents are great at selling properties, they are less so at selling themselves and the benefit of their services to both sellers and buyers.
Let’s remember the famous saying...cost is an issue in the absence of value. So let’s all make sure that we demonstrate the value of our services, our experience and our knowledge.
Finally, on my first day in agency my then boss said to me: ‘Estate agency is 99% people and 1% houses’. This is more true now than ever.
*Iain McKenzie is chief executive of The Guild of Property Professionals
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Well said, which is often why I think (without a huge amount of knowledge admittedly) that the American Model is superior, where properties are multi-listed, however, buyers use an agent they trust most. Here we sell a product we don't own, buy in, have a stock price for and once agreed have to wait for several other parties to do their job and be paid, before getting paid ourselves, all the while overseeing those other parties. Can't see automation dealing with down valuing, survey issues etc.
Simply perfect Mr M!
I totally agree with every word - how very boring of me. I particularly like...
"Technology doesn’t fulfil the transaction, people do."
Remember this.
Keep doing a good job for you clients.
Be honest,trustworthy and get the best price for your client.
Also.
Be qualified.
Very well said. The thing that is changing is convention. Take Lettings deposits, who would have imagined a zero Deposit Option a few years ago? The big nasty in property is the infernal conveyancing process, however, when you break it down it’s 98% convention that keeps the whole creaky monolith standing. If I view a property and I want it there is nothing to stop me putting down a decent deposit subject only to the place being mortgageable. There could be other simple conditions, no need to note them here. I can hear the cacophony of protest but it’s all coming from conveyancers. Agents need to have the courage to change the game rather than just doing what they’ve always done, if not, well it won’t be PB that takes them out .......
What a load of self-serving rubbish. The writer doesn't outline even one task in the sales process which couldn't either be automated now, or will be very soon. Of course someone from the Guild of Property Professionals doesn't want automation or value for money for consumers. He wants to get in the way and continue to extract £15-20k out of a transaction which should cost hundreds of pounds maximum.
Accompanied viewings? When the nice old couple who have no experience of property transactions since they bought their first home back in 1950 need advice? Someone to call all parties in a chain and gently explain what the issues/delays are all about? someone to guide a buyer with no experience through an adverse survey? The list is literally endless.
Beautifully put Iain.
Agree with Mr M, Human element is essential and always will be, look at how PB have used their TV adverts as a sort of documentary on what they have learned about the consumers willingness to use a fully automated service. 1. All about Money (WRONG), 2. We ARE an Estate Agent and here are our LPEs (NOT ENOUGH SERVICE) 3. We do ACTUALLY help you along the way with our LPEs. Technology to SUPPORT not REPLACE
This is a comment I added on another posting about a recent survey where the public stated they prefer face-to-face contact and I think it's relevant here too:
It's pretty obvious really. Face-to-face meetings are the only way to really understand a client/applicant's requirements.
Phone calls are fine of course (apart from god-awful conference calls and don't get me started on Skype....fantastic until the system crashes!!) and email is great for getting brochures/heads of terms etc. quickly to the parties involved in a deal. However, those who mostly rely on communicating remotely will never be able to build up the kind of client base and strong reputation like those of us who work our respective patches day-in-day out.
Spot on Iain, as always, and the perfect q for me to mention The ESTAS. Estate & letting agency is essentially a conflict industry where there are always 2 opposing parties – a seller and a buyer, a landlord and a tenant. There will always be obstacles and problems to solve and they can ONLY be solved by human interaction delivered by experienced property professionals. That's what great service essentially is.
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