A founder of the new organisation seeking to be a trade body for independent estate and letting agents is warning that increased investment in and promotion of property technology could lead to the undermining of the traditional agency business model.
Donald Collins of Go View London - a firm which he set up in 2010 based in west London and which now has 12 staff members - told an Agency Negotiation ‘Needle & Haystack’ podcast that if the online sector of the industry goes unchecked, there could be a move away from the traditional agency model in the next 15 to 20 years.
He says the substantial sums invested in different aspects of PropTech firms, and the greater importance put on property information by the general public, “might be used against estate agents” in the future.
“We as an industry need to define the differences between what a traditional full-service agency does, and that its fee is based on success” says Collins.
Citing valuations as a key difference between traditional and online agencies, he says: “When we value a property we stand by that valuation because we don’t get paid unless we successfully transact on that property.”
He adds: “There’s not enough distinction being made with an online agent who will charge a listing fee, broadcast that listing fee as saving the public thousands of pounds but ultimately they haven’t saved anything if the property hasn’t sold.”
Collins insists a local agent - whether corporate or independent - is likely to achieve a better sale price. In an area like London that means the notional fee saving of £10,000 or £12,000 could be in return for losing £100,000-plus on the eventual transaction price.
Collins is one of 10 founding members of the Charter for Independent Estate and Lettings Agents, which holds its next meeting to discuss articles of association, proposals, membership offers and contracts on February 22.