Traditional estate agents are not actually needed to sell a home but merely serve as “reputational insurance” to reassure a buyer the property is in doog condition.
That’s the view of Rory Sutherland, a columnist in this week’s issue of the right-wing magazine The Spectator.
In today’s issue he says that - perhaps contrary to many predictions - high street estate agents will still be around in 2065 and occupying prominent high-street shopfronts just as they do now.
He says this sounds absurd at first, commenting: “After all, almost no one now uses an estate agent to find a house: we go to property websites instead. And, since we all assume the purpose of an estate agent is to find buyers for a house, a role usurped by Rightmove and Primelocation, we think the remaining days of the estate agency are few.”
But he then says doom-mongering for the future of the industry is misplaced.
“When you pay Messrs Knight Frank, what you are actually buying is a form of reputational insurance to pass on to the new owner of the house in the form of reassurance. The estate agent is the local man who remains in place to be vulnerable to reputational and legal redress. He has ‘skin in the game’” adds Sutherland.
He claims that - just as a car buyer will probably go to a dealer rather than a private individual, despite getting less good value from the dealer - an estate agent passes on a ‘brand’ which gives some comfort to a purchaser.
The Spectator has a track record of being rather unenthusiastic about estate agents - last June it likened the industry to prostitution.