A new snapshot of market share claims that online agents accounted for 7.0 per cent of all exchanges in the first quarter of 2019 - but it demonstrates that they remain unable to get a substantial amount of business in the south of England.
The data - which appeared before today's news of the final collapse of House Network - comes which the latest TwentyCi Property and Homemaker Report, which shows their market share remaining well down into single figures and, in its words, “failing to get traction across the south.”
Although the share of completions achieved by online agents grew significantly year-on-year in Scotland and the north of England, there are dramatic falls in business in the south.
For example market share has fallen by 21.1 per cent in Inner London and 14.3 per cent in the East of England since this time last year and TwentyCi says the onliners’ overall share “is a long way from the heady 20 per cent forecast by several online agents.”
Perhaps unsurprisingly, online agents continue to do business chiefly at the lower end of the market; TwentyCi claims they show a modest growth in business for properties priced under £200,000 but fall significantly in all other price bands.
They are down 24.3% in properties over £1m and by 12.5 per cent for properties priced between £350,000 and £1m.
“Until online agents penetrate the market in the south and engage with higher-value homeowners, their growth and market share will continue to be capped” the latest report warns.
Colin Bradshaw, TwentyCi’s chief customer officer, says: “A fixed-fee structure alone does not appear to be a sufficiently compelling offer to deliver the volume of new instructions. Furthermore, the lack of penetration across the more densely populated conurbations within the south of the UK, which generally have higher-value properties, will be a source of concern for the major online agents.”
Overall, new property instructions in the first three months of 2019 saw a 5.3 per cent fall compared with the same period of 20-18 - TwentyCi puts this down to the damage caused by Brexit uncertainty.
The only regions where prices are continuing to grow are the East Midlands, West Midlands, Yorkshire and Humber.
“The lack of properties coming to market combined with the continued hiatus on the outcome of the Brexit process is undoubtedly holding the property market back” says Bradshaw.
“The continued deferment of decisions by homeowners to enter the property market is holding back supply and in turn progression throughout the property ladder. Should we achieve an orderly exit from the EU and a two-year transition, then consumer confidence may return, fuelling an increase in both volume and momentum within the property market”.
TwentyCi’s report is based on factual data covering 99.6 per cent of both the property sales and rental markets, in addition to tracking sales momentum.