The pros and cons of online estate agents
Filed under: House Prices
Homebuyers, sellers and prospective renters are increasingly turning to the internet to make their move.
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As well as the convenience of looking for a property online - you don't have to book an appointment with your local estate agent after work, during a lunch time or at the weekend - it is much cheaper.
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The cost of using online estate agents
Online estate agent eMoov.co.uk offers the "complete estate agency service" from just £295 plus VAT and is enjoying a boom during the current tough economic climate. The online estate agent's sales-versus-sold figures for March have significantly outperformed the Royal Institution of Chartered Surveyors (RICS) sales-to-stock ratio of 23.3%, across several thousand high street estate agency members.
eMoov.co.uk is one of the largest low cost online agents in the UK, with approximately 700 properties on the market. The firm explained to me that there is a huge potential market for online transactions - 25,000 properties are listed for sale in the UK each week, with just 5% of that number accounted for by online agents.
Some online estate agents, like HouseRevolution.com, really emphasise that they are much cheaper than the traditional high street agents when it comes to fees.
It boldly states that it has "saved customers a total of £502,944 in traditional estate agent fees", from selling over 210 properties at a cost of £48 million.The firm charges charge £999 plus VAT for selling a house.
Online letting agencies have become a mainstram choice too.
Upad is an online UK lettings agency that charges only £99 plus VAT for its tenant-finding services per property. It has an additional range of services, such as professional photography, floor plans and rent collection which cost £299. Last year Upad let over 3,500 properties and dealt with 107,000 tenant enquiries.
Why use an online estate agent?
The biggest selling point of online estate agents is just how much cheaper they are than their high street counterparts. They all offer slightly different services too, allowing you to shop around for the service that meets your requirements.
There's also the convenience - no appointments with your local estate agent to worry about.
And then there's the fact that, in theory, you are reaching more potentially interested parties.
As soon as many of us think about moving home, our first thought is to search online, rather than have a scan in the window of our local estate agent.
Those are some very compelling reasons to head online.
A word of warning
However, it's important not to leave your selection of agent entirely down to cost.
As Liya Fateh, director of estate agent review website MeetMyAgent.co.uk, says: "You must first consider whether you will achieve the right price for your home within a good time frame to make the cost differential worthwhile, and also if you would want the responsibility of showing your home unaccompanied and negotiating the price yourself."
Fateh makes an important point. With a decent high street estate agent you are getting a service, professionals who know what they are doing when it comes to accentuating the selling points of a property and how to negotiate the best price.
You may be confident enough to handle that yourself, in which case going online could be a sensible move. But if you aren't up to it, using an online agent may end up costing you more in the money you miss out on in the sale than what you've saved by skipping the estate agent at the end of your road.
There's also the issue of regulation. Currently property portals and websites are not regulated, though this will change if RICS and the National Association of Estate Agents (NAEA) have their way. Of course, high street estate agents are not exactly regulated themselves, as they are only subject to the Property Ombudsman.
If you need to make a complaint about an estate agent, be sure to read Complaints against estate agents at record high for a guide.
The death of the high street estate agent?
While the popularity of online estate agents is on the rise, it's still highly unlikely that it will lead to the end of the traditional high street estate agent.
Not everyone is happy to have the biggest financial transaction of their lives conducted online, with many far happier dealing face to face with an estate agent. There's also a level of trust (in theory anyway!) and local expertise when using a high street estate agent that doesn't exist online.
More of us may be heading online to help us buy, sell or rent properties, but the high street estate agent is going nowhere, for now at least.
What do you think? Would you use an online estate agent? Or would you want to do everything face-to-face? Let us know your thoughts in the comment box below.
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