There used to be two ways to sell a house. You could use an estate agent and then hand over around 2 per cent of the sale price. Or you could go down the private-sale route. At a time when many of us resent paying an agent thousands of pounds for what often seems like very little work, more and more sellers are opting for the private route. As much as anything else, houses cost so much more than they did a decade ago, so while the commission has rocketed, the amount of work involved in selling a house has not increased by nearly the same amount.
So, it's a no-brainer, right? Especially since there are now so many low-cost websites – including, most notably, a version from Tesco – that let people Sell It Themselves. But there's a snag for those who don't want to pay the men in shiny suits. According to a recent survey by Hometrack, 85 per cent of buyers are now house-hunting online, and in the main, they're only accessing a few leading property portals – Primelocation, Rightmove etc. And these portals do not accept private listings of individual properties for fear of running foul of the Property Misdescriptions Act. They'll only deal with estate agents, so they can be sure that the picture and text will match the home.
So, in June 2007, Alex Gosling, 32, and Sophie Cronin, 30, launched a company that offers a "third way" to sell your home. While the Sell It Yourself websites have grabbed headlines, without offering much of a threat to the established estate agents, the new website, www.housesimple.co.uk, launched by Gosling and Cronin, may bring about serious change. For one thing, their company qualifies as a real estate agency, so their houses appear on all the major property-search portals. And yet they charge far lower rates than a traditional estate agent.
How are they able to do this? "Its simple," says Cronin. "We don't have high-street shops. We don't have a fleet of expensive, branded cars. And we don't show sellers around the properties. The service we offer operates mainly online, which slashes our overheads and, in turn, seriously reduces the amount that sellers have to pay us."
Speaking from her car phone while driving up to photograph a new property in Manchester, Cronin explains how it all began. "My father was an architect and property developer, and I worked in relocation for six years, first while working for Deutsche Bank, where I saw things from the buyer's point of view, and then I worked for a company that sold French property to the English, so I saw things from the seller's perspective," she says.
"I was quite impressed with the French system – because the buyer pays the estate agent's fee over there, the agents work much harder. They were proactive, put the time in, called up the potential buyers. But on this side of the Channel, like so many people, I got fed up with traditional estate agencies. I found myself doing all their work for them and resenting the money that they pocketed. They were getting away with murder.
"So I decided – with my partner Alex, whose background is in marketing – to launch a new type of service that fits the needs of the new market."
If you've tried to buy or sell property lately, you'll probably relate to Cronin's frustration. Because most potential buyers have busy jobs, they want to view homes out of office hours. So although you're paying the agents to show viewers around your home, you'll often end up doing it yourself, with the agent just acting as a booking service (as Housesimple does).
And as for buying, I can speak from my own recent experience. When I was house-hunting earlier this year, I visited all the agencies around the village in which I was hoping to buy. In every case, I noted, I was the only potential client in the showroom. And when the property details started to hit my doormat, I began to wonder if any of them had listened to my requirements. I'd asked for a pre-war, three-bedroom home with a large garden, and yet I was bombarded with details of two-bedroom, third-floor, new-build flats. And places hundreds of thousands of pounds out of my price range.
"That's typical!" laughs Cronin. "And then I bet they tried to sort you out a mortgage that would cover the extra outlay!" Precisely. Like the 85 per cent of househunters surveyed by Hometrack, I found my new home online, where it had been advertised, via Rightmove, by one of the agencies who had been sending me the inappropriate details for weeks. And they'd had the place on their books all along! Which makes me think that if I had to sell now, I'd certainly give Cronin and crew a shot – or even one of their competitors (see comparison box, above right).
Housesimple offers three main tariffs to sellers. You can pay £199 upfront and it will take 0.1 per cent of the sale price upon completion. Or £99 upfront and 0.25 per cent on commission. Or nothing upfront, and it will take 0.5 per cent on commission – no sale, no fee. "If you go with other agents too, we charge a bit more – 0.75 per cent," says Cronin. "But this is a lot lower than the usual 2.5 per cent fee that most high-street agents charge."
Once you've picked your option, they will arrange a home visit (within three days of your call) to take measurements, photographs, create a virtual tour and take details for a floorplan and general description. Cronin feels that professional photos are hugely important, and "shoddy pictures are often a real problem for those selling privately".
Your property details will be uploaded on to housesimple.co.uk and on to 350 websites (including market leaders Findaproperty, Primelocation, Rightmove, Propertyfinder and Fish4homes, which generate together around 80 million buyer searches per month) as soon as the home visit has been completed. And sellers should be able to see your property on all of these websites within 48 hours.
Then they will arrange viewings, although you have to host the tours yourself. "We also give sellers a password so that they can log on to a private section on our website and see how many people have been viewing their properties online and get some feedback from viewings."
Things have been going well for the young duo. So far, they've had listed 30 properties across the country, of which seven are now under offer. Their biggest success to date has been with a £3m, 67-acre estate in Ingatestone, Essex. Cronin's father-in-law, Christopher Spencer, 65, was the executor of the former owner's will. "Although I wanted to give Sophie and Alex a chance," he says, "as executor, I had to get the best possible price for the property, so I called in the national chain, Jackson-Stops & Staff, and a local agency, Walker's, as well as Housesimple. Both of the traditional estate agents told me I should wait a couple of months to market the property because people were on holiday. I didn't want to wait. The national chain then put five or six people through the door, the local agent three or four, and Sophie and Alex got five or six viewers. And housesimple.co.uk was the only agent to deliver any offers.
"One of these offers, for the asking price of £3m, was accepted. Having negotiated a 0.67 per cent commission with Housesimple, as opposed to the 2 per cent estate-agent commission, I saved the estate £40,000."
So, why would anyone use a traditional estate agent? Stewart Lilly, president of the National Association of Estate Agents, responds. I suggest that the new model offers a serious threat to high-street agents. He was a bit sniffy: "We note," he said, "that housesimple.co.uk is a member of the ombudsman, but they are not NAEA members. One presumes that the appropriate training is given to the online advisers, and that they fully appreciate the implications of the Estate Agency Act and all relevant legislation that governs the industry.
"This is an anonymous service, meaning that the conventional estate-agent and client interaction will not be as readily available. People are at liberty to invite who they like to act as their agent, but we just hope that the people operating this online facility have the appropriate experience and qualifications involved in the buying and selling process, so that the general public hopefully get the care and professionalism they would receive from our members."
This was Cronin's response: "Although we are a new company, we do have the experience, and more importantly, the energy and enthusiasm, to sell property. And we've taken on a consultant who has six or seven years' experience with Savills.
"We promise that there will always be somebody at the end of the phone. We're not anonymous. We offer advice and help with negotiations. We realise the importance of a mediator in the process, and we fulfil that role. We just want to save people thousands of pounds by not driving around in silly branded Minis and wandering around properties with men in flashy suits.
"In fact," Cronin adds, laughing, "we don't wear suits at all. That was the first thing Alex said when we founded the company: "Suits are banned."
Which suits many modern sellers down to the ground.
With 22 years' experience in estate agency between them, Adam Day, James Venning and James Saunders launched Hatched in May 2006. In exchange for photographing your property and advertising it on the five leading property portals (among others), the company offers three options: a free launch fee with 0.5 per cent of the sale; a £99 launch fee plus 0.25 per cent of the sale price; or a £199 launch fee with £199 on completion. It also lists rental properties, offering either a free launch followed by 25 per cent of the first month's rent for each tenant found; a free launch followed by six per cent of the each month's rent; or a £200 launch fee followed by 10 per cent of the first month's rent for the first tenant it finds you.
The largest nationwide estate agent to offer a fixed fee irrespective of property value, Housenetwork has two tariff options. Either you pay £199 for "visual design" (all the pictures taken and details uploaded) and £199 on completion. Or you pay nothing for the launch and 0.75 per cent of the sale. For rentals, it charges £199 for the launch and £50 on completion.
Launched four months ago by Sophie Cronin and Alex Gosling, Housesimple (note that it's ".co.uk" – type ".com" and you'll be shopping for real estate in Minnesota!) has put together three different fee options. You can pay £199 upfront and it will take 0.1 per cent commission. Or pay £99 upfront and you will pay a 0.25 per cent commission. Or pay nothing upfront – no sale, no fee – and it will take a 0.5 per cent commission. Housesimple also charges a multiple-agency fee of 0.75 per cent.Reuse content