An online estate agent has warned that hundreds of high street agents will go out of business over the next two years.
Adam Day, director of Hatched.co.uk, says that by contrast, online agents will flourish.
Day forecasts that within two years, online agents will account for over 10% of the market, putting 1,400 high street agents out of business.
He said: “For every online estate agent that opens, nine high street agents will close, saving the public approximately £350m in fees.”
Day is also predicting that more agents will be sued next year as a result of the Property Misdescriptions Act being ditched in favour of the Consumer Protection from Unfair Trading Regulations.
He said that more agents would come under scrutiny and warned that consumer protection is a ‘catch all’ law which is not specific to the property market.
Day also forecasts that the big property portals will hold out against listing passive intermediaries, the new breed of agents who will be allowed to operate outside legislation.
Day said: “The amendment of the Estate Agents Act aims to encourage these property portals to list private sellers and intermediaries on their sites, which they do not want to do.
“The battle against property portals not listing private sellers and the coverage that this should generate will educate the public on the benefits of using estate agents.”
Comments
We've recently published a blog article about our view that both high street agents and online agents can thrive and co-exist in the future: http://www.homesalebureau.com/blog/the-future-for-online-and-high-street-estate-agents.
Of course you do. You have no idea who she is, but clearly can't stop yourself bullsh**ting, every time you open your mouth!
And yup - that's the one. Just added an S65 AMG to go next to it on the drive as well. Lovely motors - you should try one someday.
http://www.prestigecarsforhire.co.uk/self-drive-fleet/executive-car-hire/
Try the link. You might be able to afford 30 mins behind the wheel I guess.
Mr Day...
You seem to be cock-a-hoop that no-one has challenged your predictions. Interesting reallly - as your 'predictions' are based upon the following sound reasonings (from your own post):
"We estimate that...
...I think it is therefore safe to assume...
...I think we are therefore quite within our rights to assume...
...(assuming there are no major housing market crashes)..."
THEN - to analyise your actrual suggestion that "for every online agent that opens, nine high street agents will close".
You are talking about a spread of a few hundred properties, NATIONWIDE. Not in one area; not in one town - but across a whole country. Hardly likely to shut down nine branches of anyone, is it? 1600 homes as a percentage of approximately 2 million? Do you want to do the math (or would you rather take out the uncertainty element you keep building in to your claims and let me do it for you)? It is NOUGHT POINT EIGHT PERCENT of the total, give or take a few. There you go.
Less than one tenth of an instruction per Agent.
And, we are talking here about LISTINGS - NOT SALES! Take 50% off your 'big' number as abortives, if Rightmove are to be believed; then a third off the revised figure for bu99eration factor where sales don't go through; THEN what about your multi-listings?
So - not exactly based upon sound science, then. Flawed reasoning; flawed statistics; flawed knowledge of a flawed marketplace.
No wonder no-one else can give a shizzle enough to take you to task...
They're out there simply proving you WRONG.
Hello all
Thank you again for your continued comments.
It's interesting that no one really has challenged our predictions and how we arrived at them, now that this has been clarified.
We're looking forward to seeing what the future holds for estate agency. As we said in the previous comment, we believe that online estate agency is the future. Why wouldn't a customer use an online agent?
We do everything that is important in trying to find a buyer and we see the sale through to the end through the (sometimes) difficult sales process.
And we do it for less than £500.
As a previous client once said to us, "Deciding to sell our property with Hatched was a real no-brainer. They market your home better than traditional estate agents, they get it on the right websites so it is seen by most househunters in your area, they are extremely efficient and pleasant to deal with and they cost a fraction of the price of high street agents! Don't kid yourself you are getting a better service with local agents just because they cost more. We would heartily recommend hatched.co.uk and will definitely use them again in the future"
Thanks once again for the comments, and we look forward to the next story about the future of estate agency!
Regards
Adam
"A stupid or annoyingly ignorant person.
The dullard would not stop his incessant ranting on the subject until I outwardly corrected him on his incorrect data."
No name, no point, do you think you matter!? Still.
Am I right or wrong? Is what I say, however verbose, so far from the mark that I should never again darken the doorstep of EAT with my presence? - I cant answer that, even you said 'I've bored you all enough'.
'Under 50 words - no problem'. - great, give us a more succinct version and we'll get back to you.
'Oh Boy, Oh Boy....'
Under 50 words - no problem.
Am I right or wrong? Is what I say, however verbose, so far from the mark that I should never again darken the doorstep of EAT with my presence?
Answers on a postcard, please...
You did that on purpose PeeBee and I'm telling Ros!
Your assassins attempt to silence to me nearly worked. With your sniper aim you hit me, double tap with that tranquilliser dart you wrote and you put me down.
Falling head long into my morning bowl of cornflakes, facing certain death as I would surely have drowned had I not put the milk in...
But I survived, battered and bruised and now I proudly wear the mark of a true keyboard warrior, a plaster. I live another day, free to petition Ros to restrict you to 50 words, free to tell Old Boy! to stop posting in 'crayon' and free to enjoy my golden flakes in peace!
By vendors listing direct I mean on portals, not the obscure diy / fsbo sites that exist now.
The big portals don't allow vendors to list direct. Only estate agents. Pma is given as their reason, it means that the agents have responsibility for the accuracy of their content.
If the law is changing, might its doing so enable vendors to list on portals. Might excluding vendors by the portals be seen as a restrictive trade practice ?
I agree Peebee, such would not be for every vendor but it doesn't need to be, just a sizeable chunk would damage the industry. Plenty of vendors are capable and tech savvy. Plenty of vendors will also prefer to use a full service ea.
First of all - apologies in advance to 'Oh Boy.....' for serving up this bumper dose of eye strain! Think of my poor fingers!!
Okay. 'Blue' - The PMA does NOT stop private sales. The Property Misdescriptions Act does not apply to private individuals selling their own homes - so DIY vendors have nothing whatsoever to fear about that piece of Legislation.
If anything, the 'new' Legislation could be a bigger threat to them - as could any additional knee-jerk reaction measures our elected leaders decide to hurry into place when they realise how woefully inept these Regulations will no doubt prove to be when challenged.
But here's the thing that kinda blows your theory out of the water. You are a special kind of person. You firmly believe that you can do a better job of selling your own home than any Estate Agent - either High Street or online variety.
And for all I know you may be perfectly correct in your belief.
BUT - for every one 'Blue', there are HUNDREDS of Blacks, Whites, Yellows and every other colour in the spectrum who, with no disrespect meant to them, couldn't handle the sale of a pound coin for tenpence.
For THEM, Estate Agents will always be 'a necessary evil' - whether they choose the local 'expert' with a shop window or one of the many online offerings (who may be based in Karachi for all it matters) is up to them to make an informed decision - or the toss of a coin.
In simple terms, an Estate Agent is ONLY of use to a vendor IF they can produce a result. From there, however, the plot thickens. I would further argue that an Estate Agent is ONLY of use to that vendor IF:
1. They can produce a better result than the vendor could do themselves, or
2. The Agent can produce a better result than any other Agent.
In many cases, the first point is the decider. 'Yer average' Agent would win hands down in getting a buyer more effectively for a property than 'yer average' homeowner - and I'm noy even taking RM/Zoopla into account on that front. Said Agent would be able to achieve a higher agreed price with the buyer than said vendor. And they would be able to steer the sale through to a smoother, faster conclusion. If the Agent can do all these things, then they are worth every penny of their fee and more.
If they can't - then they shouldn't be trading - and THESE are the Agents that will fall by the wayside in the main... from BOTH camps.
But back to point 2. It is whether said Agent can produce the BEST result which is the question that any particular vendor is faced with - and that which is var nigh impossible to answer with absolute certainty.
I could write a book on that one point - I've certainly written a training course of five over the years on the subject... but I've bored you all enough, and you know what I mean anyway.
For those that stuck with me to the end - thank you. I look forward to the views of others.
The assumption seems to be that online agents represent the biggest , or only threat.
Imho just as big, if not bigger threat could come from vendors listing their property directly. Pma stops that right now, but pma is on its way out.
If they don't need an ea why would they need an online ea ?
@Bat Both Ways
Is that your real name?
Thought not. Please practice what you preach you dullard
No name, no point, do you think you matter!?
Dear Oh Boy,
Some manners would be welcome! However the point is that there were only 3 butchers yet there are 22 estate agents and of course the supermarkets all sell meat so they have the agency position of a large well organised 'corporate'
In an attempt to allow you the courtesy I'd hope to have back the point is that service and reputation are key, something the poster below you has failed to experience and the types they describe are exactly the ones most at threat as they add no value
@Bollinger. Wife?????
Old Boy - Don't be such a simpleton, supermarkets have decimated the high street butchers industry, the fact that one remains is hardly worth praising. Get a grip and try to see the bigger picture. Now stop writing nonsense so I can finally finish reading PeeBee, dam that boy loves a keyboard!
Define an "expert"?
Area knowledge? I've rung enough letting/estate agencies over the years and found that enough of the people that answer the phone don't know their arse from their elbow, let alone how close the house might be in relation to what I asked about. Just because the manager thinks they know it all, it doesn't always translate to the member of staff that ends up answering the phone.
Valuation? Usually the buyer and seller can work this one out - simplest and oldest principle of trade isn't it?
Marketing? I look at the internet to buy a house. I like to see half decent photos and an accurate description, any other bits help. I'd go in to ask if there's anything not in the window - that's all. You're lucky if you get anything more than "So... have you seen anyone about a mortgage" from a lot of the staff inside an office. I usually get the impression they give a monkeys about what I actually want.
You've sold my house - great! "You need to speak to your solicitor" How many times have I heard that one.
Sorry - You tell me? How are you guys REALLY any more qualified? As long as the person offering a service is frank and upfront about what is offered, I don't see the problem - I'd like ALL estate agents wherever they trade from to be clued up on what's right and wrong, but surely that's down to whichever trade body they are with. I'd pick a person in a trade based upon the same principles. I choose to sell with people I like and who don't cost the earth, if they're competent at the job, it'll be fine.
I'm glad I read this post - next time I think about moving, I'll be asking a few more questions...!
Surely there is room for everyone, i think new online agents will appear of course BUT they will also vanish just as quickly, the way Rightmove charges they are paying double, when you see prices like £195+vat until sold you know its only a matter of time.
Its the same as online conveyancing, they are cheap but they are also crap, you never can get hold of the conveyancer coz there so many working there, folks still use them though, but next time they probably wont.
Very professional, thanks for your input.
The on line travel sites were to kill the High Street shops, sorry still there, I am net savy but like to sit face to face with an expert when something like a 5K holiday comes up, let alone a home. Some go online, yep, but enough must go to the shops or they would not be there. Each to their own.
@Sibley's B'stard Child
Stay with the times darling! Its all skinny ties nowadays, big knots are soooo 2010
Over the years butchers have closed high street shops as the supermarkets took their market, yet in my town there is still one that has been here for 30 years, has a great reputation, charges high prices and has a queue stretching round the corner (with my partner and I in it!) every Christmas Eve of people collecting turkeys etc, this is despite Sainsbury’s M&S and Waitrose etc.
What is it this little butcher does that others failed to do at their peril? Any agent that knows the answer will retain a profitable share of their market regardless of the challenges from competition and exist along side online and other offerings, those that don’t will be consigned to history like Dewshursts
Something that the online companies do not have are boundaries to their geographical area, I on the other hand (along with most high street firms) stick to my own town and some of the outlying villages. The online companies don’t ‘specialise’ in a particular area and the good ones, including Hatched tend to have a fractional share of many, many areas rather than a substantial share of a smaller area / single town meaning it is quite possible that they could handle one instruction in a particular town and then never go there again meaning the impact on that local EA market from them is small and infrequent but they are commercially viable profitable businesses that work.
The thing we don’t know, including Adam Day is where the market for online will plateau in terms of market share and at what point. In my location both I and others have spent huge resource and many years building market share but based on land reg figures its been difficult to take anymore than about 35% of the local market on completed sales, one of my competitors have spent what I expect to be equal time and effort and have a similar challenge, in all but the smallest of villages with 2/3 EAs complete market dominance is difficult.
As far as I am aware the model that doesn’t work commercially is a the combination of local and online, I know of a number of EAs that started local companies without premises as online businesses then later opened high street premises, thus turning away from their original principles as they couldn’t gain substantial market share without it.
'Emoov...' - "Adam is of course correct. Logically and statistically."
Just like how YOU are correct, "logically and statistically", in your blog post which states:
"Did you know that you are only allowed one for sale board post at each property?"
WRONG! You can have as many POSTS as you want - it is the 'flags' which are restricted - in terms of maximum combined SIZE, NOT NUMBER (see also the next dissection of your 'statistical knowledge' for proof...).
"Or that a for sale board must be no bigger than 0.8sq metres in size?"
WRONG AGAIN! Allow me to quote what Local Authorities have on their websites: "If the property is for sale or to let for residential use or development, then the board must not exceed 0.5 square metres in area, or a total of 0.6 square metres for two joined boards."
And I know this not having worked in Estate Agency for over half a decade...
Maybe I made a mistake in my previous comment on this thread. I said that there must be two types of online Agents - good and bad. Must I now add a third - those that don't know the Laws that they are supposed to work within?
Or does that simply put them one of the original two categories...?
Adam is of course correct. Logically and statistically.
A better value option is always embraced by consumers when technology allows it.
And with 2000 High Street estate agency branches closing over the last three years according to Ordnance Survey, whilst online estate agents grab more and more market share, I'm afraid that for High Street agents the death knell is well and truly sounding.
The 'local knowledge and expertise' defence is a complete red herring and you know it.
Buyers research prices and neighbourhoods online. They don't need a sharp suited spiv to tell them where the nearest Kebab shop is.
WOW!
I have sat back and watched the comments coning in thick and fast on this story.
If you take out the personal attacks on Mr Day and Rosalind which are totally unnecessary and uncalled for, then take out the illiterate knee jerk reactions what are you left with?
Some balanced arguments that basically come down to the facts
1. The online agent is here to stay
2. They Will gain a significant proportion of the market.
3. High Street will not disappear but will have to change their modus operandi, and soon!
4. Many High Street agents and the less experienced Online agents will close as that is simple business, some win some lose!
As a qualified Estate Agent of over 20 years experience I have seen fads and companies come and go but I absolutely believe the Online Agent is here to stay so get used to it. If you want to survive then compete, don’t embarrass yourselves with poorly written insults as all you are doing is showing the public exactly why they don’t like you!
Good luck Mr Day, 6 years of growth shows you actually do know what you are talking about!
From the comments below I have concluded that:
1. ea's believe they are secure in their market.
2. that any challenger to that market will be inferior/dodgy.
3.that they are offended even to hear of such challengers.
alltogether now
True that would hurt them, the top bid for 'online estate agents' is about £5 a click, IMO lots of these sites are struggling right now, housesimple are charging £195+vat, smells like a failure to me.
How well will your business model is going to protect you from the real online Estate Agencies once they get going Mr Day?
Google are very well placed to do what you are doing only a bit better and you won't argue, they effectively control the internet.
Fortunately for traditional Agencies there is an established need for people on the ground doing valuations and taking instructions even if they are simply feeding a mega agency like Google.
I think it is the likes of you that are going to feel the squeeze while the smart traditional Agents works out a JV structure with the big boys.
if we all hit these dodgy online agents where it hurts....keep clicking on the adwords on google..
@N
Don't remember you, I know your Mrs though.
............are you the fella with the Aston Martin?
Jonnie
The cheap online agents are certainly doubling in size each year, any agent who uses the back end of rightmove will notice this on the competition tab. I can see this continuing for another couple of years but then probably plateauing maybe around 20 - 30% of the total market. The high st agents have the benefit of 24/7 advertising with their
Office frontage and in certain smaller towns where there is a strong localised leisure based community with good local restaurants, parks etc. then those high st agents will be part of that fabric and will maintain a reasonable share Of the market, the online model works in the Countryside and larger towns with poorer citizens, think Bradford, Luton etc. so it might not be headline news but online and High st agents will both survive but with more online coverage than we have now. That's my summary, having run an online agency for 6 years.
I
So the advantage that traditional, got a shop window, estate agents can offer the public over and above these online chaps is what exactly?
A self-publicising "entrepreneur" (probably an ex-EA who wasn't good enough to make the grade, but thinks he knows enough to break the mould,) chucks a self-aggrandising PR puff onto the table.
Dozens of thick-as-pigsh!t "traditional" EA's crap themselves, and try to shoot him down with massive amounts of denial; thereby dignifying his POV, and demonstrating beyond reasonable doubt that he had a legitimate point.
PeeBee then MAKES sense, as usual. And n- again as usual - Jonnie makes a complete hubristic knob of himself.
Priceless entertainment. Must come back here more often for a really good laugh.
And yes Jonnie; Mrs N's face still like a painter's radio on a regular basis. Just in case you forget specifically to whom you chose to be offensive in the past.
Laugh? I'm off to buy a round.
N
Who remembers the days of the £99 to sell your house? Had one here years ago they lasted about a year and then Woolworths bless em opened a counter to sell houses at the same £99 and look what happened to them. This is just not going to work.
Adam your calculations are completely wrong.
Firstly 100% PA over 3 years is actually more than a 300% increase based on year 1.
You are also assuming that of your 1600 instructions they are all sole agency and also they are instructions taken from other agents. This will never be the case for an online agency. You are more than likely taking a share of the private gum tree style landlords.
The other major factor I believe is that the figure you should be concentrating on is the amount of properties that your agency finds tenants for as opposed to the properties you market.
I could set up an agency tomorrow and charge £1 per listing to our landlords and will probably gain 1000 instructions with relative ease. This figure however is no way indicative of my market share IMO
Hello all
Thank you for all your comments, some of which were balanced, some a little OTT. I suppose with these types of forums it has to be expected. (I think the personal insults were a little too far to be honest.)
The figures quoted in the story are indeed predictions. Generally with predictions, you don't know what is going to happen, so you have to use your knowledge of the subject to make an educated guess. This educated guess is based on stats accumulated over the past years of our own business model together with stats drawn from the internet for the traditional high street agent. Using these stats, we can then make assumptions about the future and formulate predictions based on those.
For all those that want clarification about how we came up with the figures:
We estimate, that online estate agents currently list around 2.5% of properties on Rightmove. We have grown by circa 300% in the last 3 years (100% per year). I think it is therefore safe to assume that the other online agents have grown at around the same rate.
And I think we are therefore quite within our rights to assume that we (online agents) will grow at the same rate over the next couple of years (assuming there are no major housing market crashes)
Therefore 2.5% currently + 100% = 5% of the market in 2013
And then 5% in 2013 + 100% = 10% of the total market in 2014
The second prediction that is getting everyone's knickers in a twist is that 1 online agent, means that 9 high street agents will go:
At Hatched, we deal with circa 1600 new instructions per year.
An average high street agent branch will deal with circa 180 properties per year.
That means that an average high street agent would typically have 9 high street offices to deal with the 1600 properties that we deal with in a year.
1 online agent, doing the job of 9 high street agents. Or, another way to look at it - the 1600 properties we take on in a year, takes business away from the equivalent of 9 average high street agents.
We believe that online estate agency is the future. Some agree, some don't. But obvioulsy, only time will tell.
Thank you once again for all your comments.
Regards
Adam Day
http://www.estateagenttoday.co.uk/news_features/Three-quarters-of-agents-threaten-to-quit-Rightmove
A story is just a story.
Having worked on both sides of the fence, and now for an "Online agent", it's all about adding value - ask your customers! If this wasn't the case, why is the first question when most people call up wanting to sell their house, "What are your fees/how much do you charge" - I haven't worked for an agent that would advocate telling the customer until they'd book an appointment, then we'd go and waste 1/2 hour (at least) beating them down until they'd sign up because we had to no other choice but to do so if we wanted to balance the books at the end of the month. I've worked for several agencies, (a couple of the very well known ones), and in some cases I thought that the customer did get value for money, but with my last employer I really struggled to justify our + £2k fee when the branch didn't even have a decent camera. You had to PAY for a floor-plan as an extra. Incidentally, customer service had taken a back turn with this company as they have an awful call centre - the very thing that some people in estate agencies seem to think online agents are.
I don't think all high street estate agents are bad, and they should have the upper hand being familiar, local and visual. People selling still like to have their houses on display in a shop window whereas people buying a house really couldn't care less where they saw it - most of the enquiries will probably come from a board or an on-line web ad. All too often, I'd experienced situations where arrogance prevails - yes it is hard to manage customer expectations at times, but if you don't like it, don't be in the job - you knew it was going to be stressful when you signed up for it. Your customer is potentially going to net you a decent chunk of money... The reason I ended up in this job was because I was so poorly treated by one estate agency, I decided I could do their job better.
My predictions are not far off Mr. Day's - after all, on-line business in pretty much every retail sector are growing - what should happen next is integration into the local area a bit more - there are still enough agents out there with "personal" agents working without a big shop front, so if it's good enough for the big names of the Estate Agency world, why can't it work for a company that can cut some of the overheads by looking where money and resources are often wasted and use the internet to their advantage.
Incidentally, I take pride in what I do, I am suitably qualified to do my job, I'm a fan of legislation and I'm not a fan of "cheap" for the sake of cheap. Not all "online" estate agencies care so little about their customers nor are they detached from them. I can't please all of my customers, but most come from recommendation and I have very few complaints. Often I get told that the person who visited before me said "x% houses are sold on the internet anyway" - Surely you should be selling your USPs that you are so keen to defend?
there is the joke about businesses operating from 'above a kebab shop' but with this lot im pretty sure they work from an office over a fried chicken shop in hitchin
In unrelated news, sales of fat-knotted ties and hair gel set to plummet says retail experts.
It's horses for courses.
Take rental management. Try managing every little problem with a letting in (say) Manchester from an on-line set-up based in (say) London. Imagine the emails and texts pinging back and forth. Yes, it could be done but on what timescale and what cost? Not cheap!
'Well I agree with the bum chinned no tie wearing man.'
Damm it Jonnie, thats another key board you owe me.
Well I agree with the bum chinned no tie wearing man.
Thing is he’s flattering himself and his reasons are all wrong and, of course its far from a balanced view, sounds more like a pitch for flogging franchises and I think he might be the same bloke who got all in a knot on here a while back when he had his numbers challenged, not sure but if it was him I recall that he ended up looking a bit silly
Anyway……………..there are definitely lots of estate agency offices that will close but some will be an A2 retail unit and some will be ‘other types’ be it back bedrooms or a Regus Suite in Hitchin but its going to be because of low volumes meaning a small pie is sliced many ways and the need to be a strong business person not just a sales person will be essential, a combination of qualities many do not have regardless of the type of premises they operate from
So, he’s right but he doesn’t know why.
Jonnie
Next he'll be saying sainsbury's will put Harrods out of business!!! Ha Ha!
Not everyone wants 'cheap' Dave. Normally the sellers who want 'cheap' service are at the lower end of the market and more dependant on the supply of mortgages and the fluctuations in the economy.
The agents charging proper fees are selling more £1M plus properties and banking big fees, while the cheap agents struggle with the larger number of deals and viewings they have to do as well as the larger territory they have to drive round burning expensive fuel and spending loads of unproductive time driving between appointments.
You guys are welcome to the cheap fees business, where I guess the abortive work is higher too.
It is much easier for an agent with a shop window to offer a choice of service levels, their normal business model and an on-line only service, than it is for an on-line agnt to offer that choice.
It is greater customer choice that is ignored by hatched's rather simplistic prediction, don't you think?
He's done well to raise his profile, but only with competitors isn't so clever. He needs to raise his profile with the millions of people used to their local estate agents.
People might dislike agents, but use them anyway, so why shoudl they trust hatched more when they can't even pop in to complain or walk past to make sure the agent has put the property in the window?
We can so easily match his service offering, whereas he can't match ours, so he is at greater risk of closing if the regular agents decide enough is enough and offer an on-line service to defend their market share. Then is is cherio Dave . . as he can't depend on a database of past clients for repeat business and has a five minute reputation to depend on!
The legitimate High Street agents will not go out of business, but they will adapt to the market and perhaps offer the landlords who do not use an agent a combination of services they can choose from, like referencing, rent guarantees, portal entries, tenants insurance or inventories. They will have the best of both worlds, the service the same as an on line agent gives coupled with the expertise of a local professional agent offering services they require.
Having read the comments with interest, with regards online estate agents it's quite frankly embarrassing some of the vitriol aimed their way.
As far as I see it, it's a level playing field these days if you're marketed on the portals and at the right price. And who sets the price? As an ex estate agent I would give guidance based on local comparables but ultimately the owner would set the asking price. Anyone who says different is kidding themselves.
All the online guys are doing is offering a service there is a demand for. If there wasn't a demand they wouldn't be in business and there seem to be plenty of them around. Come on guys and girls - if the onliners are so poor, up your game and wipe them out. Shouldn't be too hard if they're that bad...
There seems to be a little envy on here towards them. Why is that? Competition a little too close on your home patch or bitterness you haven't come up with the idea first?
"there's a wind of change coming, and it's blowing a hurricane"
Balanced opinion from an ex-Agent looking from outside - "helicopter view", I believe it's called...
I have no axes to grind here. I am not an Agent - either online or High Street; I am not an HPCer who probably views both with the same disdain (maybe another type of balanced view...?); and I am not looking to chuck a firework into the room to start a commotion.
1. This story is IMPORTANT to Estate Agents. Ros is 100% correct in printing it. It is out there, doing the rounds - being printed in dailys, weeklys and monthlys; in property related publications and more importantly it is on the net for all that are interested to see. Ros is simply drawing your attentions to it before a customer does - so that you know what is being said. May I respectfully suggest that instead of moaning, that you be grateful to EAT for alerting you and deal with the threat in a professional way as and when needed.
Sony must have laughed their little Japanese heads off when VHS was offered as a rival to their Betamax product - after all, why would anyone want anything other than the quality that Sony were renowned for?
If your head is up your @$$ - then you can't see who is coming to kick it!
2. In my opinion, there are two types of Estate Agent. Those that are good, and those that are bad, at what they do. The good ones outweigh the bad in my opinion - based upon my experiences both 'on the tools', and in life before and after my fourteen years as an Agent. Maybe this ratio changes from place to place; it certainly changes dependent upon the market - when anyone and everyone jumps on the bandwagon the minute the market shows a hint of an upturn because "...they've always wanted to sell houses...".
Therefore, it stands to reason that there are good, and bad, 'online' Agents. Take, for example, 'Chris' - a regular poster (or at least was until not too long ago...) who runs his mainly-online Estate Agency from his home office. He seems to offer exactly the king of service that his clients want - and gets the results. Judging by the frequency and content of his postings here on EAT, he seems to have a genuine passion and committment for the job - which speaks volumes in my opinion. Okay - he's a bit of a hybrid - but then so many of the other 'onliners' seem to be also.
Now this guy from 'Hatched' sticks his head above the parapet with a press release. He makes some dubious claims which, if the PMA/CPR/ASA/whatever was an issue he would be looking at a prima facie, bang-to-rights case of 'open mouth before engaging brain' offence. But, at the end of the day, he has put it out there and the seed is planted in people's minds - and considering how maligned (unjustly, in my opinion in the case of many...) the EA profession is in the public eye, then that seed will germinate in the minds of some and WILL 'cost' traditional Agents SOME business.
Clever. Very clever, Mr Day. Now - to all you trad Agents - what are YOU going to do about it to rebalance the books?
I think that 'I was once blind' has provided us with a perfect summary.
I disagree with the timescale but I believe their impact on our 'high street' Industry could be devastating. The next 10 years could see a radical shift in Agency as e-commerce grows.
In a changing market we need to re-invent ourselves in order to maintain our relevance and not depend on arrogant, blind faith in perceived 'entitlement' purely because of our bricks and mortar heritage.
The attack is head on, an announced arrival and yet we still refuse to act, relying on a few harsh words to repel the enemy! We all raise valid points that point to our existence but what levels of existence are we prepared to tolerate? We appear content to rest on our laurels, until it's too late...
History is littered with change and good business acumen should dictate that we ready ourselves for it. We know the state of economy, the housing market and high streets; but we should also know the governments commitment to cheaper and wider access for broadband and that the most valuable company in the world is a tech company, Apple. (Google Steve Ballmer head of Microsoft mocking the iPhone at it's launch or what all those 'netbook' manufacturers were saying about the iPad)
It's all there, staring us in the face, key indicators that business can adapt to find new ways to be conducted and It's time we take action to protect ourselves.
If I were an online estate agent I'd probably say something similar.
If it goes to flogging houses for £395 a pop, I'd rather not be involved. There's just not enough money in doing it that way unless you devote little to no time to each sale.
If your offering is good, people will use it. If it's not, whether on the high street or not, they won't.
Having recently sold my house with hatched I must say I am generally very pleased with them. In terms of missing out on the personal/human interaction I personally found this a benefit. I was recently shown round a property by an estate agent who told be it was a nice street that he used to live on. The fact that he used to live on the street immediately made me think it is not the kind of place I want to live. Some estate agents are good at their job but I found too many give you a hard sell for their financial products and I think the fee is often inflated. I would recommend hatched not only because they are cheap but also BECAUSE you can avoid dealing with the estate agents in person
I sort of agree with you Andystrev
But as with @Blue, parts of your post are exactly why our model is daft and exactly what the online agents are using to win buisiness I think
"If only they knew the stress the average agent has to go through to keep a sale together and we don't even get paid until everything completes nowadays! People don't see the 30% fall through rate and the amount of time we are made to waste."
Exactly - you don't get paid for the work that you do - that is the problem with our industry! But online agents do get paid up front. And, if someone is paying up front to sell their house then perhaps they are less likely to pull out of a deal that we have worked so hard to secure, thus decreasing your fall through rate?
I have done quite a bit of research this morning on Hatched and the other online agents that are out there. To be fair, they aren't doing too bad - the bigger ones seem to be doing OK anyway - (they seem to be Hatched, Housenetwork & Emoov)
I'm certainly not a fan of it, but it is starting to get through to vendors that getting on Rightmove is the key factor when selling your house.
The thing I am concerned about is the fact that high street agents (myself included), are so dismissive of it.
They clearly don't offer everything I offer in terms of local area knowledge, a mailing list and newspaper adverts, but the bottom line is that they do sell houses by getting on Rightmove
As all us agents know, price sells houses. And as you mention, the same goes for selling a service - a certain price will attract users to a service (as long as it is low enough).
We are worth more money than these so called estate agents, but to a lot of customers, perhaps not 8 or 10 times more *cue the abuse*
Why don't we all just charge a flat fee of £999? I'm sure at this level vendors would see value in that and choose us, over them, which would be enough to put an end to this sort of model!
Blimey someone's ruffled a few feathers.
It's pretty inevitable that at some point the cost to the public of selling their homes is going to have to reduce and that technology and major portals will play a big part in that. However, people buy people, they always have and to some extent they always will so the idea of websites taking over such an old and established industry is nonsense. There will however always be people who think agents do little and charge too much. That, my friends, is the crux of the problem. We need to be more professional and prove our worth so that we can wipe the floor with the 'money for old rope' chancers that think the job is easy. If only they knew the stress the average agent has to go through to keep a sale together and we don't even get paid until everything completes nowadays! People don't see the 30% fall through rate and the amount of time we are made to waste.
Sorry Blue, but I got to pick you up on that one.
In no way am I in favour of online estate agents, but you say
"How is your smart vendor going to cope when he gets 3 different expert valuations from thee different knowledgeable local experts ???"
If the local agent is an 'expert' and 'knowledgeable', then why are all the valuiations DIFFERENT?!
Therein lies one of the problems of our industry (that we do free valuations) and what the online agents are playing on to win business no doubt!
@ Tim M. How is your smart vendor going to cope when he gets 3 different expert valuations from thee different knowledgeable local experts ???
I was under the impression that this website had an editor. Obviously i was wrong!
If any Tom, Dick and Harry can make up any old shite with absolutely no substantiation and get it published then EAT is really going down the drain. Come on Rosalind -have some standards please?
Ahhh yes, hatched.co.uk - I see an new listing nearby me this morning, well overpricesd, terrible photos and no mention of the school catchment which is by far one of the main selling points - you get what you pay for.
Leonard. The smart (ar$e ?) vendor might access your knowledge and expertise of the local area for pricing advice (which you dish out for free)... what did you say about valuing your service ?
He may then take his expertly priced property and market it for a lesser cost elsewhere. The question is: can that lesser cost alternative have the same reach and effectiveness ?
Lol at Bollinger! That said, some shameless promotion and a chap thats being entrepreneurial. It's tough running a business fo' sho'.
Calling all High Street Estate Agents, put your differences aside and let us unite to launch a nationwide campaign against these ridiculous online "estate agents".
Let us educate the public that it takes more than some call centre staffed by idiots with no idea of the local area, no list of local buyers, no relationships with investors and absolute no care in the world whether or not their property sells.
On a serious note, this is actually possible and we could soon put a halt to all these "entrepreneuers" that reckon "sellin' 'ouses is eazee".
Agree Rosalind.
This thread is the most popular today, it has got more debate going than all the others put together, one way debate, but still debate.
Mr Day, What are you talking about, High Street Agents have the knowledge, expertise of the local area, they know from experience what properties have sold for / rented for, whereas you online agents have no idea of the local area, You are a faceless commodity, nothing there too build up good business relationships.
There is an old saying "You buy Cheap, you buy Twice"
Vendors & Landlords want to buy the best, not the cheapest service, Pay Peanuts get Monkeys.... and thats what a lot of online agencies are...
In response to those that have said "surely you can do better" ... clearly they can't.
In answer to Roger Wilkinson, yes I do read and note the comments, and take on board all feedback, including criticisms of myself. I don't remove these, as I believe it is important to ensure readers have a voice and can, within reason, say what they like about stories and topics aired on here.
A very famous trainer once told me that higher fees were not an issue because if you provided the service, property selling public would see the value in that service. Direct selling property portals are worth exactly what they charge, which is in the main, nothing. Their clients will soon discover that there is NO value and that their only way of making money is the advertising they sell on their site, for bolt-on services, they will end up bankrupt and folded into larger sites/portals, while serious sellers use the only service that has stood the test of time. There has always been a proportion of private sellers, the growth of these sites has merely given those people a platform, nothing else. Mr Day has set the professionalism of those sites - and himself - back by some considerable extent.
Ha ha ha ha ha ha ha ha
Okay Mr Day, please show us all some proof for your theory.
Wow, what a muppet??
In our area of trading (Bath-Bristol) there are more online agents faltering or closing since their inception in the good old days of 2006-2007 when any old person could sell a house!
The High St agent is now showing why they are there & people are choosing to shun these cheap low quality, lack of service agents.
Why choose to undervalue yourselves in this way?
Because you dont see value in what we do or you dont have the confidence to back yourself & put your name above the door (in case you fail)?
What a joke.....
Guys - RELAX!
Ros (as editor) is entitled to publish whatever she sees fit.
This is an entertaining (i.e. funny) story that has made me laugh.
Not quite as good as a Hagar The Horrible or Andy Capp cartoon, but close enough (PS: please feel free to nick that idea Ros - it would be great to have a cartoon strip here).
All that aside, I'm sure that Mr Day is not the one to open a national online estate agency solution that the public think is amazing, but someone will.
I read an amazing article the other day which was relevant:
1. "It won't happen to us." -- Newspaper publishers (WRONG!)
2. "It won't happen to us." -- Telephone utilities (WRONG!)
3. "It won't happen to us." -- Stockbrokers (WRONG!)
4. "It won't happen to us." -- Record companies (WRONG!)
5. "It won't happen to us." -- Bookstores (WRONG!)
6. "It won't happen to us." -- Travel agencies (WRONG!)
7. "It won't happen to us." -- Big box retailers (WRONG!)
What makes you BELIEVE that you are immune, because you aren't.
@Bollinger
Best comment ever!
Rosalind,
I am surprised and disappointed to see the standard of editorial, in estate agent today, constantly being eroded by articles such as this.
Very poor indeed, not at all balanced and in no way supported by any evidence.
Come-on you can do better than this!
I wonder if you even read these comments and would welcome a response.
Roger Wilkinson
Wilkinson Grant & Co
I predict your newsletter will lose at least one subscriber in the near future in the event this nonsense doesn't stop polluting my inbox.
A High Street Estate Agent has warned that, within 2 years 50% of all new online "estate agents" will have sold not only the rest of their clothes, but probably their partner's wardrobe, just to pay for their AdWord campaign. Mr Day (pictured) has already had to sell all his wonderful ties. Mr Day comments "I was very sad to have to sell my very last tie. As anyone knows, ties are important to anyone in property - it defines us - but needs must and all that. My wife couldn't believe it and now she is having to rethink her long term position. I would go as far as to say that within 3 years, of those still left in online agency, most will be totally clothesless and at least 30% will be wife/husband/partnerless. But on the upside. at least I have some really nice computers now. I predict she'll come back to me - eventually. Hopefully. Would you like the lottery numbers for next week?"
Come on EAT you can do better than this. This is just NOT a news story, where's the evidence and where's the balance.
What crap!!!!!!! Why does EAT think that these free, attention seeking editorials are worth printing, is it just to wind up PROFESSIONAL ESTATE AGENTS? because I cant see the majority of readers of their publication being convinced.
Breaking Dad hits its on the head, the crap agents will close...........or open an online estate agency!!!
What tripe from someone who hasn't a clue what he is talking about and is simply wishful thinking.
For example
“For every online estate agent that opens, nine high street agents will close,...."
should read
“For every online estate agent that opens, another online agent will close."
and the problem for Mr Day is in the last line
"... this should generate will educate the public on the benefits of using estate agents.”
what it whould say and what will happen is
"....this should generate will educate the public on the benefits of using high stream mainstream estate agents.”
Ros this is just a complete waste of space advertorial why do you publish such comments from people whose opinions and predictions have no more validity than mine or my next door neighbour (enginerr) would have?
Whatever.
Ha ha ha ha ha ha ha.....er no.
Another negative article EAT. Well done.
Anything to substantiate these predictions or are they just random guesses and random figures?
I can have a stab at predicting the future too if you wish. Can I get some free editorial please.
Wow! How perceptive is this guy? I am the agent are on my doorstep and I dont think anyone has closed down yet in Greenwich because of their bargain basement rates. No, wait.....it crap agents that go out of business, maybe thats the 10%?
I look forward to proving him wrong in 2015 then. Purchasers have less faith in 'faceless agents' and furthermore the prices are often set by the vendors rather than professionals with comparable knowledge.
He can have all the overpriced stock - we didn't want it anyway.
Im sorry but i have never heard so much rubbish, Mr Day needs to go back under his rock or get himself a simple 9-5 job