There’s been a lot of publicity recently around the emerging on-line agent market whereby agents with no High Street costs are able to offer tantilisingly cheap deals for listing your property and avoiding ‘huge High Street fees’. But are they really offering the same thing? Or is this an apples and oranges comparison?
High Street Agents are undoubtedly more expensive. This is not surprising since they have some pretty hefty costs – staff, premises, printers, phones, cars, fuel, before we even start on advertising costs. One would not expect anyone, in any other industry, to provide a service for free so why is it that these Agents come in for such attack?
Historically, Estate Agents have been seen as some sort of pariah, the shiny suited, sharp haired, young agent who tells you he can get the earth for your property, has built a reputation of sharp practises which are somehow designed to rip off anyone dipping their toe into the housing market. But is this really true? Of course there are bad apples in the Agency business as there are in all sectors, but why is it that Estate Agents have become so derided as a profession? We’ve all seen the ironic cufflinks – ‘Trust me I’m an Estate Agent’.
So what is the real difference between a High Street Agent and an Online Agent and what do you, as a potential customer need to be aware of? Well, an online Agent will charge you upfront for listing your property. You will pay this immediately and it will not be refundable. This will cover the cost of putting your property on the online portals (usually Rightmove, Zoopla or On The Market). A High Street Agent won’t charge you anything. He doesn’t get paid anything until the house is sold.
The Online Agent assigned to your property may or may not live in your area. He may not even do viewings – some include this in their upfront payment, some do not and you need to make sure you are aware of the small print when signing up. Be aware if this isn’t included – you will be charged extra for an Agent to attend during a viewing and if you don’t want to pay this, you will be doing the viewings yourself. Do you want to do this? Bear in mind that potential buyers will speak far more freely to an agent than they will to the vendor, whose sensibilities they will be very aware of. An agent can gain all sorts of information from a potential buyer during a viewing. They are trained to ask questions about the buyer to ascertain their proceedability, their desires, their financial situation etc. It’s valuable time with a buyer which gives good background information and an opportunity which shouldn’t be missed. A good High Street Agent will do all your viewings for you and will make the most of his time with the buyer to do lots of due diligence. And remember you pay nothing for this until your property has sold.
So if you are paying extra for viewings, remember to add that to the bill.
What about negotiations? Negotiating on a property sale is a skill which agents are trained and experienced in. They know how to get the best price out of a buyer. Remember, they are acting for you and not the buyer and their job is to get the best price out of the market for you. An online agent has already had his payment so ask yourself – ‘what is his incentive to get the best, or indeed any, price?’ A High Street Agent who charges you a percentage of the final sale price is far more motivated to get you the best possible price – afterall the higher the price, the higher his fee. Remember too, if he doesn’t sell your house a High Street Agent gets nothing. No contribution to his costs, his time carrying out your viewings, paying his staff, paying fuel to get staff to your property, the costs of putting your house on Rightmove – he gets nothing if your house doesn’t sell. That’s a powerful incentive to work hard on your behalf.
So you have put your property on the market with your chosen agent and he has managed to get you an offer on the property which is acceptable to you. A good agent will know that this is just the beginning of the sales process. You now have the conveyancing to get through. If you are planning on signing up with an online agent make sure you ask about sales progression. What will they do for you? How often will they contact the solicitors, check the chain, refer back to you with feedback during the process. What will they do to ensure that the sale stays on track. So often in this uncertain market, sales fall out of bed – sometimes days before exchange is due. In England a buyer can walk away from your property, without penalty, right up until exchange of contracts. It is imperative that a finger remains on the pulse to spot possible problems quickly so that action can be taken to keep things on track and ensure your sale completes. Make sure you ask your agent how they handle this part of the sale and what they will do for you to ensure that you do actually sell your house at the end of the process. An agent who thinks his job is done at the offer stage is not worth any fee at all and it is up to you to ask these questions before you sign on the dotted line.
Estate Agency is a service industry. They are there to give you a service and to look after you, their client. It is so much more than simply listing a house on a portal and hoping for the best. There is no other industry which will provide you with the service a high street agent offers, without any guarantee of payment. A good agent is highly motivated, highly skilled and experienced and will work hard to ensure your property is sold for the highest price and actually gets across the line – if they don’t, they don’t get paid it’s as simple as that. An online agent is paid – you pay upfront with no guarantee that your house will be sold. If it isn’t you lose out. So ask yourself again, do I go with an online agent or with a high street agent – afterall a high street agent’s fees will suddenly seem quite reasonable when you have the result you want.