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Written by rosalind renshaw

In the wake of the Government’s decision to amend the Estate Agents Act, a trade body for private sale by owner websites has been formed – the National Private House Sales Association.

Complete with a code of practice, it currently has some ten members and is actively recruiting, while seeking to be the representative voice of an industry which, by its own admission, is still very small.

Meanwhile, one of its members instrumental in launching the new trade body, is predicting that more people will cut out estate agents as they try to buy or sell directly next year.

Nick Marr, of The Little House Company, told EAT that he believes agents will lose market share in 2013 as a result of changes to the Estate Agents Act, plus austerity measures increasingly hitting people in the pocket.

Marr said that currently only about 2% of vendors go down the private sales route. He is predicting that this proportion will grow to 8% next year.

Marr said: “Relaxation of estate agent legislation, the need by home owners to save money, and advances in online services are all reasons why vendors and buyers will miss out the agent.”

Marr, whose own site lists between 600 and 700 properties, said that private for sale sites had faced an uphill battle.

He said: “Our success has been affected by the big portals all clubbing together, it seems, and refusing our listings. They are all anti private sales. Yet in the US, the multi-listing system works in conjunction with for sale by owner listings.

“It isn’t even just portals that ban us in the UK: it is people like sign suppliers, software and web specialists: as soon as they find out what we do, they won’t do business. In my view, that is restrictive practice and I have a stack of emails to prove it.”

This year, Marr said his company had “made a significant contribution to a government consultation process led by the Department for Business, Innovation and Skills”.

The consultation on amending the Estate Agents Act – to allow new models, such as private for sale websites, to operate outside the legislation – by Vince Cable’s department was so poorly publicised that almost no traditional agents even knew it was taking place.

Hardly any were on the list for consultation, although the likes of Sarah Beeny’s private sales site Tepilo and Tesco were.

Marr said: “We called for a relaxation of the laws which were designed to protect consumers from unscrupulous estate agents. We evidenced restrictive practices by many UK property portals, citing the Property Misdescriptions Act as the main reason why they would not allow private seller advertising.”

He said: “With the average UK estate agent’s commission set at around 1.75% of the property value, consumers stand to save money by using private house sale services.

“It is important to note that The Little House Company is not an anti-estate agent website but one that believes in consumer choice.

“The Little House Company provides photographers, floor plan experts, property description writing and even negotiating services, all available at low fixed costs, and home owners decide how much help they need.”

Sarah Beeny’s site was asked by us for a comment. Nothing on its website makes any forecasts for next year and it is understood that Tepilo has yet to join the new trade association, although Marr – whose wife Jane launched it – says it has expressed its interest.

Zoopla has said that it will not accept private sale by owner website listings; Rightmove has yet to confirm its stance, after saying it is studying the impact of the change.

Property expert Henry Pryor said he agreed that more people will try to sell their homes privately, mainly because they will be driven by a need to save money.

He said: “Seventy per cent of the coalition’s cuts have yet to be implemented, so money will be tight.”

The trade body website is here:

http://www.NPHSA.org

 

Private sales sites launch their own trade body

Comments

  • icon

    Me again!

    Look, people - you know by now that I'm 100% pro-Agent. At least, pro-Agents who actually do a decent, honest job (who in my opinion are in the majority...).

    I CERTAINLY believe that, for a good majority of potential sellers, an Estate Agent can be an absolute boon. They will pay for themselves many times over in terms not just of value achieved but also in the mental torture that is buying and selling.

    BUT - I'm gonna play Devil's Advocate here.

    Lots of sneering going on at this "Trade Body".

    In fairness, so far, it looks a little like a one-man committee - and the Crimbo Party is going to be held in a phone box.

    BUT... cast back half a century and you find THIS:

    " The National Association of Estate Agents (NAEA) is a membership organisation for estate agents (called real estate brokers in the US). It is based in and covers the UK.

    It was founded in 1962 by estate agent Raymond Andrews."

    Did Mr Andrews celebrate his first Crimbo Party in the same phone box, I wonder?

    And would the same comments have been tossed at that new "Trade Body" all those years ago?

    • 29 November 2012 18:16 PM
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    @Blue

    Not sure your answer is as comprehensive as you would have asked from me if you'd posed the same question but ill let that ride as the article is going to drop off the front page

    Please stay and have another tussle on future articles and stick with one name, it's more fun for all of us including you and let's us all get to know each other

    in time you will hopefully give more detailed answers and do a bit less ducking the question, it's bad form so let's hear some proper answers from you next time

    Jonnie

    • 28 November 2012 18:04 PM
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    WOW! That'll teach me not to read an entire story properly... just spotted this at the foot:

    "Property expert Henry Pryor said he agreed that more people will try to sell their homes privately, mainly because they will be driven by a need to save money."

    Erm... hang on a cotton pickin' minute! Is this THE Mr Henry Pryor:

    ...he of the questionable statistics (haven't seen any for a while, Mr P...)?;

    ..."the BBC's favourite property expert"?

    ...THE BUYERS AGENT?

    Erm... the Henry Pryors of this world are the very reason that vendors need an Estate Agent MORE in order to protect their best interests, surely!

    Any thoughts?

    • 28 November 2012 13:01 PM
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    Blue: Well, you were the one who complained about the £500k and £250k owners being charged the same percentage, yielding different fees - but you propose a solution which doesn't actually change that, and which still (apparently) would lead to a difference in fees between them......

    Que?

    • 28 November 2012 10:15 AM
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    W. It doesn't get round my issue. The issue is still there. There is an issue.

    • 28 November 2012 08:16 AM
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    Blue: Would this work ? 1.5% if you sell it in 4 weeks. 1.0% if you sell it in 8 weeks. etc etc

    =============

    So if you sell a £500k house and a £250k house in 2 weeks each, how does that get around your issue?

    And it wouldn't work.

    • 27 November 2012 23:48 PM
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    W. Would this work ? 1.5% if you sell it in 4 weeks. 1.0% if you sell it in 8 weeks. etc etc

    • 27 November 2012 19:22 PM
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    Jonnie. In your scenario I would do what an estate agent would do. Negotiate.

    • 27 November 2012 18:11 PM
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    I comment a lot on this subject, it is my pet peeve if you will.

    I still state unequivocally that it will happen, even though I am a high street estate agent.

    BUT there is a value in employing an estate agent.

    In a recent transaction I negotiated both up and down a chain to ensure that my vendor (the one paying the commission) did not bear the full brunt of a price reduction after a survey on the property they were selling.

    The fault was theirs (they did not have relevant paperwork from the district surveyor for the installation of solar panels) and the buyer was fully justified in asking for a reduction.

    My hard negotiating and with help from the other agents involved, I managed to agree a spread of £10k across the chain and make sure that all 5 houses are moving.

    That's 6 families sorted before Christmas, approx £2.3m of property transactions and £35k of commission that just would not have happened without the input of the agents involved.

    It would NEVER have happened without agents involved because there were some prickly customers who variously said during it all "That's it - I'm pulling out!"

    The days of the high street agent might not be over, but there is a new game in town.

    • 27 November 2012 17:48 PM
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    "gob on a stick Jonnie", most funny, not come accross that one before, and spot on!

    • 27 November 2012 16:06 PM
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    @W

    He doesn’t seem to have any answers; im still waiting for him to reply to that gob on a stick Jonnie who’s posed a question to him. Lunch break coming to an end, hopefully see a reply later!

    • 27 November 2012 13:58 PM
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    Blue: "Please if nothing else explain to me why you charge double the fee to a guy with a £500k property than you do to a guy with a £250k property."

    I'll take a shot as well as PeeBee; if you DON'T charge a percentage, and you DON'T charge a tiered fee based on value (which is essentially the same as percentage-based), then what options are there?

    Payment by the hour? How would that work?

    Flat fee for everyone? Won't work. There'll be a break point where the flat fee equals the current %age that the EA charges. If this flat fee is applied to all, those with lower value properties will be paying more than the current % of their value, and those with higher-value properties will pay less. Lower fees for the rich, higher fees for the poor. Doesn't make good business sense to me.

    What would you suggest?

    • 27 November 2012 13:36 PM
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    The systems are very different but I think that comparing the situation in France where private sales are usual can really show that there is space for estate agents and private vendors even in this difficult market.
    I don’t know if I am authorised to post link (please remove if I am not) and if any of you speak French but here is one of the study done in France:
    http://www.meilleursagents.com/actualite-immobilier/2012/01/meilleursagents-devoile-les-pratiques-reelles-des-francais-pour-la-vente-et-l%E2%80%99achat-de-biens-immobilier/

    Summary:
    60% of French vendors use both estate agent and private sale channels to sale or buy a property. In France still 68% of properties are sold through an agency, 19% where private sales and 13% thanks to other channels (notaires, family…)

    For Buyers, using estate agents has proven 3 times more efficient than private Vendors
    For Vendors, estate agents have proven 2.5 times more efficient than trying to sell only privately.

    I do think that the change to the Estate Agent Act means that estate agents will need to adapt (listing contract, marketing, services…) but I definitely think that estate agent sale and private sale can run alongside and that these changes are far from being the death of estate agents.

    • 27 November 2012 13:10 PM
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    Only facts I have seen are 2 FSBO, both failed and after months realised their mistake and sold via an Agent. Every right to try of course but it no real problem.

    • 27 November 2012 13:08 PM
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    W, you make some valid points but yet vendors are actually selling without agents. It's happening and if we are to regain the lost ground we need to accept this, re-group and strengthen our position.

    EVERY vendor can be a client if we offer a the right services.

    • 27 November 2012 09:47 AM
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    Jonnie thats a tough one for any vendor, clearly an agent is better suited to handle your scenario and would certainly earn their fee in doing so.

    What irks the vendor is having to pay fees when the transaction runs smoothly and quickly completes. In this situation they don't easily see the value in agency.

    I think we need to do a better job of communicating our role in sales progression. More transparency in our duties would go a long way to re-assuring vendors of our worth.

    • 27 November 2012 09:40 AM
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    Blue; "Vendors can do (with easy help) 99% of what you do for a few hundred quid, not 1+% of the value of their home."

    But many vendors don't want to, or aren't able to do this.

    How many vendors are in a position to take phone calls at any time throughout the day, and possibly into the evening and weekends? Don't vendors work for a living? You may be lucky enough to have an occupation that frees you to answer the phone, but I can picture many others who can't. Buyers won't wait for you to phone back.

    Many vendors welcome the agent between them and the (sometimes troublesome) buyer.

    That's only one aspect of it. I could go on.... but if you're all cut up about 1%, take a look at other territories, where EA fees are measured in terms of 3, 4 or 5%.

    • 27 November 2012 09:31 AM
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    @Jonnie. Spot on.

    Mr Marr. As politely asked for at the start of this thread I'd still very much like to hear what evidence you have for your claims. You have got some solid evidence, haven't you?

    • 27 November 2012 09:25 AM
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    He said: “With the average UK estate agent’s commission set at around 1.75% of the property value, consumers stand to save money by using private house sale services.

    ===

    I find the perpetual over-quoting of high-street agent's commissions to be an odious practice on the part of many online operators. Beeny is particularly bad in this respect.

    The OFT determined a few years back that average commission in E&W was 1.60%, and 1.10% in Scotland.

    Where does the 'average' 1.75% come from???

    • 27 November 2012 09:23 AM
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    You demand manners and then display your own lack of them with insults, in the same sentence. Clearly I've offended you as much as your 'debate' offended common sense but hey, don't shoot the messenger.

    stonehenge - apologies for any spelling mistakes!

    • 27 November 2012 09:20 AM
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    @Blue,

    Okay, I'll give you a real life scenario and you tell us what you would do to solve it, up for that?

    So, lets assume the easy bit of valuing it right, promoting it right, doing the viewings and negotiating your price is all done and dusted, after all its easy stuff as you say. nice you've got all that cracked, the solicitors have been sorted and have begun the simple process of working to an exchange of contracts and completion and of course your buyer has secured a mortgage AIP no problem and the survey has been done.............this is too easy isn't it, all just falling into place a treat, I'm starting to see why you can do it on your own, anyway, at this point after all the easy stuff is nicely boxed off you get a call from your solicitor ( clever lad like you will have one of those ones that are really proactive, and ring you, you won't go for one of those cheap ones that has too many cases on the go for the number of staff and give terrible service in return for the £300 you are giving
    them )

    so, your solicitor rings and says that the lender has down valued the house, there are some things about the wiring that need sorting and the other side has also asked for a reduction or they are pulling out, they are also now not happy that its taken so long (despite them being slow to kick off with and you having pulled out all the stops) and if you don't vacate to rented and break the chain then he deal is off and they will go for another one that's just come on the market.

    when you are ready run us through your next steps and lets see how you would deal with this

    wait to hear from you mate

    • 27 November 2012 09:15 AM
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    Blue: "Please if nothing else explain to me why you charge double the fee to a guy with a £500k property than you do to a guy with a £250k property."

    Allow me a shot at this one, please. Although obviously the answer is extremely parochial, there will generally be a significant number more £250k properties that sell in any one year than £500k properties. Your example does not state - but in a number of areas the difference could be tenfold or more. A half-million pond pad could take a year or more of marketing, as against a couple of months for its smaller, cheaper cousin. The negotiation process will be different - offers talking in terms of one or two thousand pounds at a time with the 'cheaper' prices - but at half a mill you could be arguing the toss over five or ten grand with each offer tendered. That extra increased offer negotiated could more than pay for the Agent's entire fee - SHOULD, in fact.

    As I have said to you before, Blue - an Agent is ONLY of use to a vendor if they can do a better job than the vendor can do for themselves.

    If a vendor has an Agent sitting in their living room talking to them - then it is a fair assumption that the vendor has decided that this would in fact be the case - do you not agree?

    • 26 November 2012 23:48 PM
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    Old Boy.
    Nice camomille tea ? nurse emptied your bag ? Then I shall begin.
    Joe Public can deal with solicitors, they do English.Stop hiding behind that red herring.
    Estate agents valuations are accurate? my ar$e.
    Estate agents marketing is superior ? to what ?
    Will negotiate on your behalf? pass on offers?
    You can defend your market, and I don't blame you. But, it's flawed.
    Vendors can do (with easy help) 99% of what you do for a few hundred quid, not 1+% of the value of their home.

    Please, Please if nothing else explain to me why you charge double the fee to a guy with a £500k property than you do to a guy with a £250k property. Well? how do you explain it to him ?

    • 26 November 2012 23:03 PM
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    @tut!, tut

    I do hope that if you did ever represent your self in a chain / transactionyou showed some degree of manners and common courtesy rather than the rude, abrasive character you show your self as here, your attitude is one of a spoilt child, this site is about debate, you prefer to shout your view and tell the rest of us we are wrong.

    calm down, show some manners and don't come back until you have done so you odious little man

    • 26 November 2012 19:38 PM
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    Could posters please improve their spelling such as "definitely" rather than "definatley" - Yuk!

    "Losing" rather than being unshackled from "Loosing" unless you are a Steer at a Rodeo!

    I've seen some really poorly drafted letters from Estate Agents complete with shoddy spelling and grammar, and not just typos either.

    You're professionals aren't you?

    • 26 November 2012 19:27 PM
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    Elaine P - as you belive you can deal with 'the process' without a third party you have definatley not got a clue

    So you firmly believe it impossible to sell without the aid of an EA, and yet many vendors are doing just that. To be clear, conveyancing has a solicitor at each end and you think an EA is the only one capable of sitting in the middle progressing....and you call me useless.

    • 26 November 2012 17:50 PM
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    Note to angry man who posts as Time Old Boy Retired,

    There is no need for a response to all your points as your stunning lack of knowledge is perfectly summed up by your comment on conveyancing, as you belive you can deal with 'the process' without a third party you have definatley not got a clue and no further comment is needed, you've exposed your self as useless to the debate. May I suggest HPC a better home for your misguided views

    • 26 November 2012 17:08 PM
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    As soon as Mr Marr of The Little House Company starts offering "negotiating services" which he says he will, he will be pounced on by trading standards. Passive intermediaries are exactly what it says on their box, any pro-active marketing and help with valuations and sales brings them within the scope of estate agents' legislation which is there to protect the consumer.

    A lot of these people will be trying negotiating and valuing as they find that their clients want more for the next to nothing they will be paying, and it is for us, the consumer and the authorities to keep a beady eye on proceedings.

    There seems to be confusion as to whether Mr Marr is a passive intermediary or an online estate agent. There is going to be one hell of a lot of confusion amongst the house buying and selling public over who is what.

    • 26 November 2012 15:58 PM
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    Apolgies, my mistake. They are a private house sale site.

    They certainly used to be an 'online agent'. Must have been kicked off by Rightmove recently.

    • 26 November 2012 15:09 PM
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    Old Boy!

    1. Sellers do not need to factor in an agents commission into the asking price- this can reduce the property price by thousands – So you can save the fees of an EA but give it to your buyer in the form of a reduction, that seems to mean there is a neutral cost saving - (Or maybe vendors get to sell their property at its true value without the need to inflate it to cover EA fees, or if it makes you happy they could keep the price unchanged and keep the difference for themselves. Just to clarify, even a 'neutral' cost saving is a SAVING.)

    2. Sellers can be more flexible as comparable properties will be more expensive – I suspect that based on listings on most current online or private sites vendors up the price when they do not have an adviser guiding them? - (Vendors managing the price themselves and not having to increase it to cover EA fees, in comparison will be more cheaper than the ones with an EA on board. Given that EA's are prone to over value or accept a vendors 'valuation' over their own just to win the business, it would seem that your suspicions are actually working in reverse.)

    3. No risk of agent negotiating so that a commission is increased – Based on the % model outlined on the site the more the commission increases the more the sellers final price increases, what’s not to like by the vendor? - (Only sensible thing you have said.)

    4. Buyers and sellers feel more in control of the priocess [sic] – a savvy and sharp buyer can benefit from this but I fail to see how the vendor would in that instance? - (What about the savvy vendor? When both have access to the conveyancing process they equally retain control and do not have to rely on a 3rd party go between, the EA.)


    it appear that a buyer would do well from a private sale there just appears to be little in it for the seller who will save £3465 (average UK house price x’s 1.75% as quoted plus VAT) but will end up loosing it all and some to the buyer. - (Are you serious? How can the vendor lose £3465 when they never had it in the first place, It's a cost saving!!!! The vendor saves on your fee, attracts more buyers as the price is realistic and cheaper than comparables and secures a buyer quicker.)

    The aim of these 'self sale' sites is clear and their ethos hold water so they will certainly attract interest. Rather than trying to deconstruct them why don't EA's concentrate more on building and strengthening their own proposition.

    • 26 November 2012 14:52 PM
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    Wardy, all these online agents certainly haven't got that facts right about the average fees charged by agents, I certainly wouldnt say its 1.75%, id say nearer 1.2%.

    Still when you pop on their websites, their online calculators all seem to be set to 1.75 - 2% to show their fees against what you could save.

    • 26 November 2012 14:18 PM
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    @AgencyInsider

    I look forward to hearing his views but meanwhile;

    1. Sellers do not need to factor in an agents commission into the asking price- this can reduce the property price by thousands – So you can save the fees of an EA but give it to your buyer in the form of a reduction, that seems to mean there is a neutral cost saving
    2. Sellers can be more flexible as comparable properties will be more expensive – I suspect that based on listings on most current online or private sites vendors up the price when they do not have an adviser guiding them?
    3. No risk of agent negotiating so that a commission is increased – Based on the % model outlined on the site the more the commission increases the more the sellers final price increases, what’s not to like by the vendor?
    4. Buyers and sellers feel more in control of the priocess [sic] – a savvy and sharp buyer can benefit from this but I fail to see how the vendor would in that instance?

    Let us see what he responds with but it appear that a buyer would do well from a private sale there just appears to be little in it for the seller who will save £3465 (average UK house price x’s 1.75% as quoted plus VAT) but will end up loosing it all and some to the buyer.

    • 26 November 2012 11:24 AM
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    We probably shouldn’t do this again, last weeks debate on this turned into a bit of fisty cuffs.

    Anyway, this is a cracking idea, according to this chap 8% of people will not use an EA next year and will use a private seller site, in fact oddly for an EA forum we do get a lot of chaps that say they will be part of that 8% and would never use and EA, why they frequent this place ive no idea as they don’t like, need or want to be involved with us but maybe there will be a ‘Private Seller Today’ website spring up soon to serve them.

    Point is if the public end up with a clear choice of EA and non EA then a clear distinction is only right. As far as suppliers go same should apply here if you proudly build your business as not being an estate agent and being a distinctly different sort of thing then its right that EA suppliers don’t deal with you………………you aren’t an EA and you have a trade body to prove it

    Good idea all round, don’t want people not being an EA and then trying to look and sound like one when it suits now do we?

    Jonnie

    • 26 November 2012 11:10 AM
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    It sounds like Mr Marr is kicking off with a chip on his shoulder.
    Could I ask, what qualifies Mrs Marr to set up a trade association and where you get the figure of 1.75% as an average fee?

    • 26 November 2012 09:51 AM
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    Leaving aside your statements of the obvious (5, 8) and the rather bizarre (6,7, 8) where is the evidence to support your more sensational statements 1, 2, 3, 4, please Mr Marr?

    This from the NPHSA website.

    The advantages of buying a property without an estate agent:

    1. Sellers do not need to factor in an agents commission into the asking price- this can reduce the property price by thousands

    2. Sellers can be more flexible as comparable properties will be more expensive

    3. Buyers can buy more for their money

    4. No risk of agent negotiating so that a commission is increased

    5. Sellers know the property far better than the agent

    6. Buyers can learn more about the local area, transport network schools and shops from the home owner

    7. Running costs will be more accurate

    8. By referring the sale to a professional conveyancer both parties have the same amount of legal protection

    9. Buyers and sellers feel more in control of the priocess [sic]

    • 26 November 2012 09:50 AM
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    So let me get this right....

    If I am a Private House Seller website I have the option of joining up to this NPHSA scheme, which will allow me to 'stand out from the crowd' and let consumers know that they are safe if they use me, that is also owned by the one and only... Nick Marr!! Who happens to own a competing Private Seller website!!

    Crazy.

    Ps. Do you have funding behind you to make the website and the brand 'NPHSA' known to the consumer/end user of Private House Seller websites, Nick....?

    • 26 November 2012 09:41 AM
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    “It isn’t even just portals that ban us in the UK: it is people like sign suppliers...." ??? News to us, why (and how) would we "ban" you Nick?

    • 26 November 2012 09:35 AM
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    @Private House Sale Site

    No they are not, RM would not let them list, they are private sales.

    • 26 November 2012 09:03 AM
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    The Little House Company is an 'online agent', not a private house site seller...

    • 26 November 2012 09:01 AM
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