New web agencies looking for easy life in property

Estate agents fought hard for survival during the recession but as sales pick up, they are facing another battle.

This time it’s from the internet, as everyone from celebrities to entrepreneurs challenge the old order with web-based agencies. Sir Stelios Haji-Ioannou is set to launch EasyProperty, which will have a fixed fee approach.

Sarah Beeny recently re-launched her online agency, Tepilo. It charges from £195 to £895 with a host of optional extras that include a visit from an agent, who can help prepare listings and floor plans. Purplebricks.com, which launches this month, is taking a similar approach.

Poundland boss, Steve Smith, is also hoping for more of the action after promising to expand Estates Direct. Its fees start at £195 for a basic service and a listing on property portals, such as Rightmove. If the house sells, another £195 is payable. Additional fees will buy a visit from an agent, brochures and will pay for the agency to negotiate on your behalf.

“For us, it’s all about giving sellers more control and removing the hefty commission fees associated with the traditional estate agency model,” says Mr Smith

While there’s a rush to cash in on the property revival, the web-based business model isn’t new. It dates to the 1990s and still only has 5% of all property sales. Despite predictions by Britain’s biggest online agency, eMoov, that “online will explode”, traditional agents are sceptical.

Kevin Hollinrake, managing director of York-based Hunters, which has 120 branches nationwide, says: “A minority of people have always sold their homes privately through classified ads and they will be happy selling through a website and dealing with a call centre, but most vendors want a personal service. That’s why internet-based companies have not taken off in a big way.

“A property is a huge asset and clients want the best service to find the right buyer at the right price. They want their hand holding through the process and they want an agent to negotiate and make sure the deal goes through. You might save a bit on the agent’s fee if you use a website but you may find you get less than you want for the property and that it takes longer to sell.”

He adds that at an average 1.5 per cent of the selling price, UK estate agency fees are considerably lower than other countries like America, where they are 5 per cent. He also warns that web-based agencies charge less for those who pay upfront and more for those who want to settle up after a sale.

Tim Blenkin, Director of Blenkin and Co., York, meanwhile, has this message for Easy’s Stelios: “So you can do my job for £350 can you? Well let’s first bury a few myths:

Myth 1. Agents take a photograph, post details of a house online and wait for the fees to roll in.

Well, it just ain’t like that. Many of my clients are downsizing, possibly from a house where they have lived for 40 years. They probably have an old family solicitor to handle their sale; the title is not registered, and they have no clue about the process of moving. They want advice on their purchase too, and even on how to take a final reading of the meters. These people want their hand holding.

Myth 2. Everything is done online these days so agents are largely redundant.

Rightmove may be the market leader, but the average property stays in front of a buyer for two seconds. So, sellers need more help, not less, than pre-online days. Blenkin & Co. houses are seen one million times a month on Rightmove, but the real buyers are the ones I talk to.

Myth 3. Agents are always chasing their fees when it’s the solicitors who do the work

Many large law firms got so disenchanted with conveyancing in the slump that they let most of their team go. As a result many cannot cope now that volumes are returning and we agents have to chase constantly, often just to get a contract sent out.

So, come on in Stelios. The water’s lovely, but it’s hard work, a very personal business, not a bucket shop airline: and my clients will still value the service, attention, and sheer good manners I provide.”