The proportion of so-called For Sale By Owner private house sales in the US has slumped from 13 per cent of all transactions in 2000 to just nine per cent last year - a sign that estate agents' work is recognised as invaluable for most deals.
This may come as a blow to those in the UK who want alternatives to estate agents, whether through truly private sales directly between sellers and buyers, or through the increased use of online services which in some cases claim to be anti-estate agent.
Another surprising statistic just released from the US is that while there were an estimated 140,000 real estate brokers and agents working in that country back in 2000 there are no fewer than 198,000 now according to the Bureau of Labor Statistics.
This information has emerged as part of the fall-out over the possible impact in the US of the acquisition of the Trulia property sales portal by the Zillow portal - roughly equivalent to Rightmove buying Zoopla in the UK.
Zillow firmly denies that the $3.5 billion acquisition of Trulia - which has still to be agreed by competition regulators - will lead to what US realtors fear most, that is the setting up of a national online agency service which by-passes traditional agents.
"We started Zillow as a media property, not a real-estate brokerage. We sell ads, not houses. In real estate, there will always be a practitioner in the middle of a transaction, helping consumers with an infrequent, complex and emotional transaction" according to Zillow's chief executive, Spencer Rascoff.
As in the UK, the desire of sellers to use estate agents - despite a downturn squeezing household budgets and despite the proliferaton of online alternatives - may ensure that Zillow and Trulia never go down the direct house sales route.
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Comments
In the not too distant future, I think that high street agencies will start including more and more details and evidence in their contracts and info packs about why they are worth their fee and what they will do to justify it. For first time sellers, describing the numerous problems that a high street agent can deal with on their behalf during the house sale will hopefully act as a powerful deterrent if they are considering using an online agency.
If you live in central London then I think using an online agency is a great option as houses are in such high demand and there is no shortage of buyers. In the rest of the country (bar maybe a few areas of other desirable cities), estate agents really have to work hard to match buyers to properties and to encourage people to view something that they perhaps would not have initially considered.
I personally have sold several properties this year to people that had completely skipped past them online, dismissing them as unsuitable. Pictures and floor plans never tell the whole story. An agent who makes the effort to develop relationships with buyers can persuade them to view properties that they may not have even considered otherwise. These are the agents that will prove to be more than worth their commission, and they are the ones who will prevent the online and private sales from becoming the norm in the future.
"We sell ads not houses"just like EMoove, Purple wotzits and the others then.
What a non story! Just how many Private salkes take place, alomost none, it just PR, come on how many of us even knew the USA web sites name Now the real take could be why are they doing this PR now Could they be after a deal, Zoopla or RM or even some of the ones that are no good like AM
People do underestimate how much work an estate agent does during a sale. It's not easy to go it alone, as the 'for sale by owners' in the US have found. Sometimes the criticism directed at estate agents is warranted, but a great many of them do a good job and take a lot of hassle and stress away from their clients - which is what you want when you employ a professional to help you with something. I don't think the DIY alternative is in any way better.
The US have the right idea about trusting estate agents to do a good job, the UK have such a warped opinion of us that they see the online and private selling options as an escape whereas I think they are there as alternative options. Not everyone is going to want everything an estate agent can offer them and it's good that there are alternative options for people who have the time and knowledge to take on more of the responsibility themselves. This whole idea of online vs traditional has been blown way out of proportion!
I don't understand why it infers the opposite You can't accompany viewings over the phone and if you spend the same time with clients and have as many staff then all you are saving is the relatively reasonable cost of a hight st office. You don't need them everywhere but in many places they are more than worth the cost. Great agents are worth their fees, it's a tough skilled job and anyone who doesn't think so doesn't understand the dynamics of the business
What's that Estate agents are actually useful when it comes to selling property Well I never. For people who say estate agents do nothing for their money, I point you in the direction of this article. It's not all that easy when you try to do it on your own, is it
Moving is a fraught business , customers need the reassurance that a competent agent gives them
In the end this service will be the panacea to the minor irritation of on line agents
...the UK has evolved to Online agents..Private selling was not working, the dominance of Rightmove guaranteed that. The US is going the same way with Zillow becoming more dominant.
As I have always argued - private selling simply doesn't work! I think there might also be a problem with the figures quoted in respect of the number of agents and brokers currently employed in the industry. It is quoted at 198,000 yet the National Association of Realtors has nearly 1.1million members paying annual subscriptions and growing at about 5% a year! (see http://www.realtor.org/sites/default/files/reports/2014/monthly-membership-stats-2014-07-02.pdf). This is probably due to the fact that many US agents (who typically sell an average of only 7 properties a year) are part time, offering a "personal agent" service within a very small area (possibly a few streets only) where they make it their business to be the obvious agent of choice for sellers in that area. Nothing moves there without their involvement. UK agents can learn a lot form this - go deep, not wide and become a "property personality" within your agency as people buy people.
'....deliver their product via the internet (and phone).....'
Not so. They deliver INITIAL INFORMATION about the product.
What this says is that people (in the US) are using agents more. And that's great. However I'm not sure that there's a message in this that says 'And you can therefore charge sellers what you like in the UK and they will continue to pay through the nose'. It rather infers the opposite in fact.
But yet again we have a convenient assumption that estate agents that deliver their product via the internet (and phone) are not bona fide estate agents. Even though agents of all types use email and phone more than they are face to face now.
The consumer realises that even if the industry refuses to.
If anyone would like to purchase
PrivateHouseSale.co.uk or PrivateHouseSales.co.uk call me 07718203909, had them for years.
Brilliant and spot on, so great to read something that puts the current internet agent craze in a nutshell. I'm rewriting our message to our clients to focus on just this point. Great agents are worth their fees and they dont need to cut their prices, sellers and Landlords are better off paying higher fees for what is provably an invaluable service.