Two summers ago, the rise of the estate agent seemed unstoppable. Branded cars and in-house coffee bars were de rigueur at agent offices, and sellers happily paid out for their services. But now a savvier breed of property owner is emerging – disillusioned by agency fees and the service they recieve, they are using the internet to cut out the middle man from the buying and selling process.
In a change that industry insiders say will transform the property market and, in its wake, put an end to the high street estate agent as we know it. But is this familiar sight on the high street really on its way out?
In 2007 there were around 12,000 estate agents in Britain, according to the Ombudsman for Estate Agents (OEA). Since then, around one in four has closed. Meanwhile, property websites such as Right Move have become increasingly popular, with 90 per cent of all homes on the market now featured on the site. While the number of property search queries on Google has grown by 35 per cent this year.
Difficult market conditions and cautios lenders are primarily to blame but estate agents haven't always helped themselves. As a recent report form Which? illustrated. It showed that some agents were charging up to 50 per cent more for Home Information Packs (HIPS) than some specialist providers – giving ammunition to those going it alone.
Such is the internet's dominance in today's housing market, that some estate agents are just directing walk-in customers straight to their websites. Jonathan Harward, chairman of The County Homesearch Company, a nationwide house finding service, says the role of the estate agent is changing: "Ever increasingly, they are becoming a marketing tool and a portal for the internet. We are not going to see the same number of estate agents on the high street ever again. A lot of middle of the road estate agents won't come back because they are unable to skilfully match people to properties like they used to.
"Our business is morphing into a consultancy. People are coming to us with properties they've already found on the internet because they want independent advice from us. Rather than the whole house finding service, they want to be driven around a certain area, or to use our black book, or want someone to do their negotiations."
While Harward does not think the future is set to bring the outright death of the estate agent, he thinks the emphasis is changing. The business will be concentrated on telling people how to present and market their properties and providing consultancy with "some independent estate agents, some strong national ones and house finders."
Customers are becoming increasingly autonomous, finding properties on the internet for themselves and seeking professional advice as and when they need it. With the vast majority of properties now advertised online, and tools that allow buyers to look at flats and houses from street level such as Google Street View, buyers don't need an estate agent in the same way they used to. While some buyers are even using online property "dating agencies", such as the recently launched Property Flirt, to identify people who are considerong moving.
The National Association of Estate Agents (NAEA) is adamant that it is the market, not the internet that is to blame for the decline of estate agency. Gary Smith, President of the body says, "The internet is not a threat to agents – there is a clear benefit to agents and their clients from internet marketing. It reaches more people, more quickly."
But many customers are proving the NAEA wrong by saying that they are only registering with estate agents so that they can get onto their websites. When tour operator Simon Prockter sold his Docklands one-bedroom flat online in 1997, he was hailed the internet's first ever property sale. He marketed the South Quays flat using a website he built himself and sold it for £94,000 – over double the amount he bought it for two years earlier – on an early web start-up called UK Property Gold. But now, 12 years on, he says that while it is much easier to find and buy property online, it is still a challenge to sell independently because of the hold estate agents have on the web market.
"Even though I am selling my one bedroom flat in Limehouse, East London myself, I've still gone through estate agents so that I can get my property online. But I haven't accepted any offers through agents because they are encouraged to take sales on lower offers because they're just one person working on self interest," says Prockter.
Meanwhile, Yvonne Macken from Oxford is disillusioned by agents and the fees they charge. "We felt we could do better ourselves than an agent," she says. She is now selling a two-bed house in Newquay, and as a corporate designer and publisher she had the skills to build her own website for the property.
Another problem for people wanting to sell privately, is that until now it has required specialist knowledge. But according to Sarah Beeney, the presenter of Property Snakes & Ladders, who recently launched Tepilo, an online do-it-yourself property selling portal, it is not rocket science. She says the internet has removed the need for estate agents and that in the future it is likely that estate agents will be the preserve of complicated or "out of the ordinary" sales. "An estate agent's role is incredibly different to what it used to be. The internet's completely turned the process of finding a property on its head," says Beeney.Reuse content