The future estate agency model is going to be neither the traditional High Street office nor the online-only alternative - instead it is “all about hybrid” according to Countrywide’s chief digital officer Alex Bailes.
He told the 'Future: Prop Tech' conference in London that Countrywide “has just commissioned one of the biggest pieces of research, surveying 3,000 consumers” and that it was clear they did not want purely online agency services, especially as its share of the wider sales and lettings market was so low.
“It’s all about the hybrid space” Bailes told the conference, saying it was clear from the research that consumers wanted local expertise and a competitive sale price for their property most of all.
Critically, the fee paid to the agent came only fifth on the list of most important decision making factors for would-be vendors he said.
The conference also heard from emoov chief executive Russell Quirk, Purplebricks founder Michael Bruce and Chris Wood of Cornish estate agency PDQ Property, who has analysed the relative performance of traditional-versus-online agency activity in his area.
PDQ’s Wood told the conference that his concern was greatest about online operators offering a non-local non-geographic offering to sellers and buyers, and that online agents giving crude valuations using Land Registry data that was “three months out of date at least” was doing a disservice to consumers and the industry alike.
Purplebricks’ Michael Bruce told delegates that consumers now had the largest choice of agent-type they had ever enjoyed, ranging from old-school offerings to online-only, with his own service operating somewhere in between - ”akin to a high street agency model as we have local property experts.”
In a debate involving questions from the floor, Russell Quirk from eMoov insisted that commission-based agency had had its day. “It's not fair and it’s broken” he said, describing it as “a con”.
He cited Foxtons’ average fee as £14,000 and claimed this was not higher than agents outside of London because the firm put in more effort, but merely because the capital’s homes were more expensive. “How on earth can that be right?” he asked.
(Reporting from the conference by Conor Shilling of Angels Media)
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It's never been about online or high Street or a hybrid! It's about the best way to develop a relationship with a vendor that starts off with them not trusting you or your agency! Technology won't help if its used incorrectly.
I agree, creating trust is essential. Since online agents will generally not offer face to face interaction, they are at a disadvantage, even if their rates are much lower. But that's why it makes sense for them to explore the hybrid model, although this does raise their costs.
The fee came fifth. That should tell agencies that vendors want something other than manipulative pricing. Russell Quirk bleats on about commission fee system being unfair. Whether London vendors choose to pay £14000 or £895 is immaterial. A Skoda will always be perceived as less valuable than a Mercedes. Selling the Mercedes for a Skoda price isn't unfair nor does it make business sense. High Street agencies have so much more to offer and should not be dragged down on price or service by here today-gone tomorrow online offering. The hybrid model, on the other hand, has the opportunity for success but the appearance of a business that lacks the confidence to invest capital in high Street premises because it doesn't have faith in its ability to make a profit. Let's stop talking about technology being the future of estate agency as a business model. It's simply a tool to make good estate agencies even better. The weaker agencies can jump on the technology bandwagon and boast about being less expensive, but vendors care about four other issues apparently.
Looking forward to seeing the results of this Countrywide survey - I'm sure that will dissuade anyone from entering the online space...
Some interesting observations, although Michael Bruce saying we're ”akin to a high street agency model as we have local property experts” - just sounds like another one of their cheesy adverts!!
There's changes happening in tech and legislation which alters daily agency operations.
Many try and address changes in all corners, but when agents are busy trying to be busy, its often hard for new things to enter. Most will operate with familiarity and if it ain't broke - don't fix it.
For sure things could be FAR better if only the industry could embrace better practices for agents and consumers.
My opinion is that the future its Online... 100% sure, but online agents didn't manage yet to offer a practical business model that will work for landlords and tenants.. I 'm working in a local estate agency and I can tell that tenants and landlords prefer the local agents instead of Online agents for 1000 reasons..
One and the most important reason is the personal approach the face to face conversation with the client!!
So how are online agents going to deal with Money Laundering?
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