In the ongoing battle of online vs traditional estate agents, who is currently winning? Is it still worth parting with a percentage of your final home sale and going to your local high street agent to market your house, or heading online?
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When online estate agents such as Purple Bricks, Yopa and Strike came onto the scene several years ago, some predicted that the days of traditional – and more expensive – estate agents were numbered. This prediction has never materialised, so what is it that makes high street estate agents continue to hold their own in the world of online property selling?
First, however, it is worth saying that if you are selling a house in the UK and using an estate agent, you’re not even paying that much in comparison with many other places in the world. According to research by estate agent comparison site, GetAgent.co.uk, in terms of the percentage charged in commission, the UK is actually home to one of the lowest at 1.57 per cent on average. To get much lower than that, you’d have to be selling in South Korea, where agents get just 0.55 per cent of the final sale.
By sharp contrast, estate agents in the US get a whopping 5.5 per cent of a final house sale; in Mexico and South Africa, they get a dizzying 7.5 per cent. That certainly puts the traditional complaint that estate agents are expensive in some perspective.
Still, property in the UK is expensive, and even 1.5 per cent is actually quite a lot in real money terms. Online estate agents typically charged a fixed fee that is much lower than the amount you end up paying a traditional agent. So, what is it that makes estate agents worth the expense?
Online vs. traditional estate agents
We spoke to Kirsty Burnham, Head of Property at Movewise about the differences between traditional and online estate agents. ‘Traditional agents work very differently to online agents,’ she explains. ‘They are proactive with their lists of buyers and therefore generate more viewings than those enquiries generated from the online listing alone.’
‘Traditional agents will carry out the viewings on a property so they are able to understand what a buyer wants and to negotiate with them when they find a property they want to buy. By having this relationship with a buyer, the traditional agent is in a far better position to generate you a higher offer for your property.’
That’s not to say that online agents are entirely to be dismissed, especially if you are a buyer rather than a seller, ‘ there is no harm in using a traditional agent and an online agent to help you with your search,’ says Kirsty.
However, she points out that you will feel the difference where it comes to viewings. ‘With a traditional agent you are more likely to be shown a property by the agent, rather than the vendor of the property or an outsourced viewing company.’
‘You are then able to give them far greater detail of what type of property you are looking for. As soon as you have this understanding with the agent you will be in their mind for appropriate properties that come onto the market. They may even phone you before a property is officially listed if they feel it is exactly what you are looking for.’
Edward Amdur from hybrid estate agency Tatewood, says that online estate agents are definitely more of a gamble, because your house may not sell at all. ‘With high street estate agents, it is the traditional way that everyone knows, and generally speaking, provides a better service,’ he says. ‘You pay upon completion, but you have a higher percentage to pay compared to online, which you pay upfront and is a low fixed fee. The problem with this, is that once you have paid for the online fee, the sale still may not go through, and the agents on the case may not be motivated to go through.’
However, sometimes there also is more than meets the eye in terms of costs. ‘Alongside the lower cost, there are a couple of other costs that you should take into consideration, as some online estate agents which charge for extras (viewings, photography, etc.), which would have already been included into the cost if you had gone with a traditional high street estate agent.’
Going with a hybrid agent is a potential solution, according to Edward – they will charge you more, but only on completion of the sale, like a traditional agent.
A home seller’s experience
It might come as no surprise that an estate agent would be singing the praises of estate agents. However, Hebe Hatton, a Digital Editor, who tried both an online and traditional estate agent when selling a flat in London, found that the traditional method had its merits.
Hebe first put up her flat for sale back in October with an online-only estate agent. ‘We took it back off within the time we could claim the money back, but they were not the most helpful or positive’, she says.
Her current experience, with a traditional estate agent, is markedly different. She was particularly pleased with the effort the agent made to style her flat for the photos. ‘They styled our flat for the photographs and spent a good two hours doing so, which, considering its three rooms was really good. They had a stylist and a photographer come to do that,’ she explains of her experience.
‘They depersonalised the space to the extent of removing photos, but still kept plenty to make the flat look lived in. Plus, they put everything back exactly how it was when they left.’
Hebe said that what has been the most valuable is how helpful the agents have been in what’s unarguably a tricky time to sell in a big city. ‘They have been really helpful with getting interest in a time where no one is looking for spaces without gardens. Helping us adjust the price while also being really understanding that it needs to be worth our money to move.’
Hebe gets weekly updates on viewings and the agent has taken the initiative to make viewing times more flexible. ‘After a few weeks they stopped just doing weekend viewing and are more flexible with future buyers, but they always give us plenty of notice and check it works for us.’
Hebe’s experience highlights that a good, local estate agent will really put the work in to sell a property, where some online agents may not be as motivated to do so.
It’s not cheap, but you are paying for a personalised service that may be ongoing for weeks or months. Having said all of this, if paying a bit less is very important to you, then you may consider the middle way – a hybrid estate agent that will be cheaper than a high-street agent, but will only charge you if the house sells.