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Online estate agents versus traditional estate agents

Online estate agents versus traditional estate agentsI recently read: “When you are moving home, the first thing to do is keep an eye on your costs. With estate agent fees often running to thousands of pounds, this is an obvious place to start cutting back...” While this makes sense in theory, upon reflection, it should be clear to most people that expertise is not what you should be cutting back on.

Online estate agencies should be very much welcome within the industry, as competition is healthy and it is important to have options when you are selling your house. Using an online agent could seem to some like the sensible thing to do, but you could be missing out on a premium price. We often hear that anyone can sell a property in a rising market, which I don’t disagree with, however only the best agents get the very best prices and the difference can be tens of thousands of pounds if not more in some cases, so cheaper agent fees rarely equals best price in a sellers pocket.

There are some obvious drawbacks to online estate agents, the main one being the lack of local knowledge that a great agent should have. Online agents, while having the advantage of working across multiple areas, lack the expertise of focusing, working and even living in the specific area that they are selling in. Lack of negotiation skills is another issue and can mean the difference between a sale being agreed at a premium price or a market price. 

The power of negotiation is not to be misjudged and it is unrealistic of online estate agents to expect sellers to be able to negotiate directly with a buyer, as they are too emotionally connected. A property professional is defined as somebody who has undergone industry exams, training and possesses a high level of experience, therefore they will know how to maximise the best price for their sellers. Although globalisation is turning the world increasingly online, connections and networks are still built and strengthened face to face. An established high street agent tends to have a list of prospective purchasers up their sleeve to contact when selling a property: a little black book full of potentially interested parties is difficult to establish and build from behind a screen.

Another concern is viewings, a good estate agent should attend all their clients’ viewings so that they are on hand to answer any questions, point out any less obvious benefits and relay information about the local area. They are also there to make sure the home or office is properly presented before potential purchasers enter and to offer advice on the presentation of a property.

A high percentage of sellers prefer not to be present when viewings take place as it can be awkward. Buyers also prefer it that way so that they are able to have a good look around rather than feel as though they can’t explore and get a good feel for the place with the property owner in situ. This is something that most online agents cannot provide, which is a major downfall because this is often the point in an exchange when a major impact is felt by buyers and provokes the moment they decide if the house is right for them. Knowledge and hands on experience is crucial as advice is often needed on the smallest of things, for example people may say a room looks too small – but it might just be there is too much furniture in it, so you move a desk or water cooler and potentially the next week it sells.

While face-to-face interaction can be overlooked in favour of online marketing, which is in itself a very strong tool, a combination of the two is the ultimate key to success. A good high street agent should religiously utilise social media, online property portals, online advertising and search engine listings to promote its clients properties, as well as sticking to the traditional expertise of selling properties through connections, recommendations, referral’s and long term relationships.

There are savings involved when using an online agent, but these are only on expenses. Without the expertise to gain the best possible price, a short amount of commission saved by using an online agent is nonsensical, as ultimately you could end up with less in your pocket, not more. 

About the author

Jonathan HudsonJonathan Hudson (MNAEA, MICBA) is the Managing Director of Hudsons Property


Features March 2014

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