Is it worth using an online agent to sell your home?

Is it worth using an online agent to sell your home?
Spring is the time when ‘for sale’ boards seem to breed as more homeowners than ever decide to make a move. But, with a growing number of online agents, just who do you to choose to sell your home?
The battle for market share continues to rage as traditional agents compete with online firms for your custom. Best known for selling upmarket country piles, Humberts is the latest casualty, the agency recently went into administration, so is this the death knell for traditional agents? Trevor Abrahmsohn of Glentree International, renowned for selling multi-million mansions in Hampstead’s The Bishops Avenue sees no competition from online firms: “They give you a menu of charges that you have to pay come what may, and advise on what they believe is the value of your home, but this could be up or down of the true, underlying value by a large margin …… and then, you are ‘on your own mate!’”

Online scams

Abrahmsohn warns that the 20% upfront charged by online agents is a ‘fatally flawed concept’. He believes that sellers don’t have the necessary expertise to monitor a sale’s process and even cautions on security issues, warning that a ‘buyer’ could turn out to be merely ‘casing the joint’. On top of that he warns of ‘bottom feeders’ targeting online agents by buying properties cheaply and then reselling them at a higher price: “We know of one example that was sold in north west London, to a property speculator via an on-line agency for approximately £500,000 less than market value. The owner thought saving tens of thousands worth of fees was a great deal, but didn’t realise that they were giving away hundreds of thousands to a buyer they had never met. A doctor would not deliver his own baby, how can an unsuspecting homeowner do the work of a highly trained estate agent?” 

Are upfront costs worth paying?

onlineestateagency.jpgScare stories are rife but online agency numbers are growing. Online agents and ‘hybrids’, who offer a combination of services, now make up around 7% of the market according to online agency Purplebricks which puts its rapid growth down to ‘great service’ and the fact that customers prefer fixed fees. “It is fairer than to allow those who do sell to prop up those who don’t. Our fee is payable whether you sell or not, but we will market your property until it is sold, our support doesn’t have an expiry date. We have saved our customers tens of millions of pounds in commission fees,” says a spokesperson. 

No long term contracts

One criticism of traditional agents, and some online firms, are their attempts to tie vendors into long-term contracts which the founder of online agency House Network Mark Readings, warns against: “The property market is changing and it does not matter whether you are looking at traditional or online estate agents, you should think very carefully before signing a long-term sales contract.  We know that most properties sell within the first three weeks, so it makes no-sense to sign-up with a single agent for six months and potentially have your property sitting with them unsold and un-viewed for over five months.  We always advise using the best options for selling your house, and avoid being pushed into a deal which suits the agent.”

Avoid overvaluations

traditionalestateagency.jpgWhoever you choose, don’t just pick the agent who comes up with the highest sales price. Consumer champions Which? carried out some interesting research showing that overpriced properties eventually sold for less and took longer to sell than comparable homes on the market. Their advice includes; getting three agents around to value, looking at comparable properties that have sold, and, wherever possible, getting recommendations from local friends and neighbours. Make sure that you have investigated exactly what their fees cover and what happens if you don’t sell. Shop around, as even some traditional agents, especially in slower pace markets outside the capital, charge upfront costs, for example to produce brochures of your home.
Online agency charges £695 but their MD Will Clark admits that selecting an agent in today’s market can be overwhelming: “It’s partly driven by the plethora of choice,” says Clark who says that firms like his save customers money by passing on the savings they make by not having a high street presence: “Our customers decide how much control they want over the sales process, and how much they can afford to spend. Sellers thinking of using an online agent should be aware that they come in different forms.  Some are hybrid and have a 'local property expert’ who comes to see your house in person. This person is responsible for getting your house on the market and will not be the person who helps progress the sale of your property.” is purely online or telephone based. “Our sales and customer service teams sit together in one room and use local data to advise you on the price of your property. Our principle focus is the customer and ensuring a sale that is as stress free as possible,” Clark adds. Whether you prefer online or traditional, always check your agent’s qualifications. Estate agency is unregulated but industry bodies such as RICS and the NAEA for sales and ARLA for lettings means that their members must stick to certain standards.  

We sold through online agents

Mandy Barton, 48, from Cumbria sold two properties with Purplebricks, saving her £5,244 in fees. “My partner suggested I try Purplebricks. I read the reviews and was really impressed.” A local property expert valued one of Mandy’s properties on Friday, and the ad went live on Saturday.  Mandy paid £99 on top of her £798 fee for a premium advert on Rightmove. The day after Mandy’s ad went live, she had her first viewing and the property sold within a week. “I loved the fact I could do my own viewings. Who else knows your house better? If people had questions, I could answer them there and then.” She plans on using them for future sales. “The experience is easy and transparent. Everyone who wants a house goes on Rightmove now, so why should you pay expensive fees when you don’t need additional marketing?”
 johnstirlingpurplebricksopt.jpgJohn Stirling used to sell his two-bed flat in South East London for £510,000, saving around £8,000 in fees compared to a traditional agent.  “I was initially sceptical as I was concerned that they may not be as good as the traditional high street estate agents,” John explains. After reading reviews he went ahead and was impressed with the price structure which allowed him to pick and choose which services he needed. “They kept me fully up to date with feedback and I was able to view and accept or reject offers online. I would have no hesitation in using them again. They were very professional and I highly recommend them. As pleasant an experience as selling a house can be!”
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