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How estate agents are adapting to the growing market share of online house-selling websites
00:02, 11 August 2016
Spencer Fortag is hoping he has hit on the next stage of the rapidly evolving house-buying sector.
His company Dockside Property Services has launched an online bidding service, where sellers are paid to sell their home.
Unlike other estate agents, it will not charge homeowners for selling their property. Instead it will receive its income from 2.5% commission paid by buyers, which it splits with the seller.
“It’s still in its infancy, so we’ve had no instructions yet,” said Mr Fortag, whose Rochester company has been based in the county for 11 years and employs 10 people.
“It is an innovative way of selling and buying. They have complete transparency. They can see the bids, similar to eBay.”
Dockside, like many other estate agents, is adapting to a rapidly changing property sector, where new players are entering the market all the time.
In May, Cubbyhole was launched from Discovery Park, Sandwich, allowing homeowners to bypass agents and advertise their property for a flat fee of £60 a week.
Its chief executive, serial entrepreneur Peter Lampe, pledged to spend £2 million on an initial media campaign, with 72% of its expected profit to be put back into marketing.
Similarly, online estate agent PurpleBricks has run high-profile advertising campaigns and now commands a 60% share of the online market, making it the UK’s fourth-largest estate agent.
“Customers are becoming lazier,” said Francesca Marchesini-Ashley, who launched Rochester comparison site Compare Online Agents with husband Robert Ashley two years ago.
“Rather than going to a shop and looking in the window, people look online. The older generation will go to the high street because they are not used to the internet, but younger sellers are more adventurous.”
Mrs Marchesini-Ashley argues her website proves the strength of the online sector as it only compares non-bricks-and-mortar agents.
“When we started two years ago, online agents’ market share was only 2% to 3.5%. Now it’s double that and going higher by the minute.”
She says online and high street agents are very different.
“You can’t compare apples with oranges,” she said. “They have different price structures and packages.
“On the high street you sell and pay on completion, so there is not much to compare apart from the percentages.
“Online there are options for pay-as-you-go, pay some now and pay some later, some offer viewings and some don’t. There is more data and differences. We narrow it down based on what you want.”
The online craze has even spread to the traditional auction industry.
Clive Emson Auctioneers is launching its own online auctions platform this month, although it already offers bidders the opportunity to bid online for lots at its live auctions.
Clive Emson, chairman of the eponymous business, based in Maidstone, said: “The whole industry is changing. In 10 years’ time, high street agents will not be as prevalent as we know them.
“If you look at travel agents 15 years ago, they said the internet wouldn’t take over because people wanted to see the brochure and talk to staff, but when was the last time anyone went into a travel agent to book a holiday?
“Now with all the information about homes on Rightmove, people can see what other houses are selling for. You don’t need three estate agents to come in and value your property because you can get the same information they can.”
Online estate agents are predicted to hold a 50% share of the market by 2020. For now, its share stands at about 5%.
“It’s still really busy,” said Charlie Boyd, a sales negotiator at Mann Countrywide estate agents in Gravesend.
“Most of our business is already online. We get 90% of our inquiries from people seeing properties on Rightmove and Zoopla.
“We still do get some people walking past the window and coming in, but most is online.
“When I first started we were losing business to the likes of Purplebricks, but since then people have realised the customer service side is important.
“They prefer speaking to people who are familiar with the area. Business is going well.”