A decade ago we were still years away from Purplebricks, Countrywide was a colossus in the industry, no one had thought of OnTheMarket, and as for PropTech - what’s that?
So, what will the next 10 years mean for our industry?
To mark Estate Agent Today’s 10th anniversary, we have again gathered our panel of experts to give their opinions on what we may be working on, reading about and infuriated by in the year 2028.
Our contributors may be amongst the very best in the business, but they have no monopoly on seeing into the future. If you have ideas of your own, or want to take issue with what is said here, please contribute to the comments section below.
In the meantime, thanks to our experts for giving such exciting and challenging views, and thanks to you for reading Estate Agent Today as we go into our second decade.
Here’s to the next 10 years - whatever they may bring.
Richard Rawlings, agency trainer, marketing consultant, and co-founder of AgentMasterclass and The Lead Hub:
In five years’ time, two or three low-cost/low service agencies will account for maybe 30% of the market. There will also be free online agencies going for volume with revenues from mortgages, insurance, conveyancing utilities, etc.
Then there are the people who will always pay more for expertise, knowledge, and service. They will happily pay 2.5%-3% for the accountability offered by their preferred agent.
I expect this boutique-style agency to account for a further 30% of the market, although these agencies will probably have their own free/low-cost entry point and upsell from there.
The remaining 40% will simply die – with the fall-out polarising to give 60% to low-value agencies within 10 years and 40% to the boutique agencies who will have crushed their mediocre competitors stunning service – full staging, fresh weekly flowers, proper buyer representation, binding offers backed by an underwritten agency guarantee, an increase in agency-led private off-market sales and guaranteed sale prices.
Purplebricks could take over Countrywide’s physical branch network, and even offer a top- end full-service product. Rightmove or Zoopla could accept private listings, closing the gap between portal and agency.
These are exciting times for progressive, imaginative agencies, but be warned, these things could happen within two years, not ten!
Ian Wilson, chief executive officer of The Property Franchise Group:
The future of estate agency is the combination of a recognised brand and ‘blow your socks off’ service by individual sales agents.
Big brands can afford the technology infrastructure to offer a genuine 24/7 customer experience, and brands bring instant customer recognition and trust.
We might see an existing big household brand decide that the time is right to enter UK estate agency waters. However, this has got to be backed up by a great personal experience, and the vast majority of people employed in the industry lack the depth of knowledge, skill set and frankly, charisma to create a compelling story about why you would recommend them to your friends.
Fortunately, technology will mean that in future we will need far fewer people employed in the industry as there is scope for much further automation of administrative tasks. However, the remainders will enjoy high earnings.
Neil Cobbold, chief operating officer of PayProp in the UK:
In the lettings sector, incoming regulation such as the long-awaited tenant fee ban will have the expected effect in that rents will increase. As for agents, overall numbers will shrink but those who are doing well will end up with bigger lettings books.
I also think that over the next ten years we'll see increased automation in a modular way. However, the PropTech sector may need to reduce in size. There's been a boom of new services, many of which don't fix market-wide problems. These operators will need to adapt and amalgamate or their technology could fall by the wayside.
As for online agents, I don't see market share changing too significantly by 2028. It might be slightly larger, but this will be due to more traditional firms offering online services.
The disruption of online-only has already happened and it's clear we still need people in the transaction. That's why I think hybrid will become the new norm. We may also see more agents offering property concierge-style services.
The online space needs to be something agents are less afraid of and more willing to adopt - as effective use of technology and systems will help map out the path of the modern agent.
If we're looking at future innovations, then it depends how far we take the concept of agency. Smart buildings, for example, how can an agent get involved if this sector booms? We could see more agents offering facilities management, acting as contractors and looking after properties as assets for people they've already sold to. I believe by 2028 there’ll be great advancements in technology which mean all property can come under the banner of agency.
Michele Niziol, vice president of ARLA Propertymark and director of IMS Property Group:
Choice is at the centre of the online vs. high street debate. Virtually everyone starts their property search online, but with many online agents, that’s where their service stops. The industry needs to be mindful of the power of technology, but I believe that many customers still want a human-led service.
The rise of the hybrid agent solidifies the high street agent’s proposition. Consumers make their initial contact through an online portal, then move to a local area expert. Property does not have a one-size-fits-all solution: the market variations support the need for the local property professional (and therefore the high street agent). I expect the majority of ‘online’ agents will actually be ‘hybrid’ agents in 2028.
As far as trends go, the world is moving beyond traditional bricks and mortar. High street agencies are all supported by websites with online booking features, and the online estate agency sector has taken around 7% of the property market.
At some point, the question stops being ‘high street or online?’ and becomes ‘who provides the best service?’. Focusing on providing the best product to our client is the end goal and adapting to their needs and desires is the only way to get there.”
Jeremy Leaf, north London estate agent and a former RICS residential chairman:
Change seems to be happening in our business even faster now than at any time over the past decade. Flexibility will be more important than ever in future as agents try to respond more rapidly to changes in customer circumstances and behaviour - from more short-term Airbnb-style lettings to medium/longer-term owner-occupation.
Purchasers/tenants will source property via increasingly sophisticated apps based on income, job, lifestyle, shopping and travel habits, age, medical history etc. Facebook and Amazon are likely to become sales/lettings property portals in the not-too-distant future too.
Proptech will continue to find solutions to problems we didn’t know we had, especially software-automating admin, valuation and lead generation, which will hopefully free up time for more personal service.
Multi-discipline or hybrid agency will probably soon become the norm for high-street agents, whereas online-only agents are likely to gain a larger market share if sales/lettings numbers improve.
All these changes may make some estate agents almost obsolete if they don’t operate efficiently, employ modern marketing techniques and the latest technology to improve the customer experience.
Anthony Codling, equity analyst at Jefferies International:
The recent merging of three hybrids suggests that individually none of them had been able to scale quickly enough into a sustainable business. If the hybrid market is the best thing since sliced bread, and growing so fast, why is there a need to merge?
Agency remains a local business. It's my belief that when they move, the overwhelming majority of households move no further than five miles from their previous home.
I think the biggest trend over the next 5 years will be a reduction in the number of estate agents as the volume of housing transactions continues to fall and fees continue to come under market or regulatory pressure. I also expect to see growth in franchise groups (such as Belvoir) and affiliate groups (such as The Guild) as agents seek to benefit from cost economies of scale and the safety of outsourced legal and compliance services.
The prospect of Facebook entering the property market is interesting, although I doubt that many agents would want to be beholden to an organization almost 100 times larger than Rightmove. I continue to believe that OnTheMarket was a missed opportunity for agents to take back control of their data and to reclaim the very large profits they currently allow the portals make from their listings.
However, I have been wrong on portals before, 10 years ago I thought Rightmove’s profit margin would peak at 50%, now it is 76%. Maybe by 2028 Rightmove will have exceeded its aspiration to charge agents £2,500 per month per branch.
Iain McKenzie, chief executive of The Guild of Property Professionals:
This sector has changed more in the past three years than the previous 32 years that I have been an agent. Predicting the future is therefore virtually impossible. Anything could take off, from the virtual viewing experience to drone surveys or bitcoin purchases.
On a more traditional perspective, I fully expect the government to evoke section 22 of the 1979 Estate Agency act to implement full regulation and qualification of all agents.
Legislation and technology will combine to produce automated methods of communication between stakeholders such as agents, conveyancers and surveyors with a single platform transaction method.
And finally, I expect a full understanding from the general public that agents deliver customer care, while technology delivers customer experience. Even if the market does polarise, customers will always pay a fair fee for the expertise and knowledge that a true property expert delivers.
Mike DelPrete, a US-based PropTech expert:
As I've shown in my latest research into the future of real estate portals, we're going to see a continued evolution where portals are involved in more aspects of a property transaction.
In certain cases, like Zillow's Instant Offer program in the U.S. or REA Group buying a mortgage broking business in Australia, some portals will move significantly closer to the transaction, displacing the traditional roles of agents.