Online Agents – Cheap as chips or hit and miss?

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So, Purplebricks, Tepilo, Emoov, Yopa the list goes on. There are an ever-increasing number of online agents popping up all over the place nowadays, but how good are they, and are they actually cheaper?

Well on the advertised price it would certainly seem so.

Many prices range from £395.00 to £1399.00 in some London Postcodes when your more traditional agent charges between 0.75 to 1.25% of the final sales price.

If you look at the average sales price in Southend (£285,000) then the average commission payable is £2850,  so on paper all of the traditional agents in Southend should be closing down right?

Wrong!!!

One of the reasons for this is that people still value the service element of a business.  Yes, you can save money online but at what cost to the service that you are given?  As a quick and simple example, most of the online agents charge extra for accompanied viewings.

Now if you are anything like my partner you do not want to be showing people around your house, answering various questions (some that you make take offence to), and some that may not be asked as you are the owner, which may in turn reduce your chances of a decent offer!

Then there is the additional cost for floorplans, EPC’s, premium listings, negotiations on your sale and even a helpline number!!

 

Another very important thing to remember is how this ‘cheaper fee’ is paid.

Imagine having to pay for your drinks up front and then waiting two hours for them to arrive, you would not be happy would you?  What about paying £995 up front and your house taking a year to sell, or paying £1995 and it selling in three months? How much are those 9 months’ worth to you?  How much have you lost while the market price changes in those 9 months ?

I’m not saying that this happens, but what control do you have if it did, seeing as you have already paid the company their fee?

What if you were not happy and wanted to move agents or even go to a second agent? More cheap fees (maybe payable upfront)?

What about if you didn’t have to pay upfront, surely that would even the playing field? Well sometimes yes but not in every case.

 

A lot of online agents offer sell now and pay later, or pay in 12-month schemes which are a novel idea, but these tend to enter you into a legal credit agreement which can add interest to your fees and cost you more than you already thought you would have to pay.

 

Also, please, don’t think that you will always get the sales price that you would want, with an online agent.  Your online agent is charging you a flat fee regardless of what price your house sells at, and although most online agents claim that they get the desired price for most property sales, there is currently no evidence to support this.

 

Remember, that with a traditional agent the more the house sells for the more commission they earn!  They are motivated to get you the best price.

 

Think about the pub again – if you agreed to pay the waiter or waitress £1 for getting your drinks over to you in under 5 minutes they would never be late!

 

Many people consider themselves as Estate agent ‘Wannabes’ and are quite happy to do some of the legwork in order to reduce the cost of their sale.  But in most cases the value of good old-fashioned service shines bright and in my mind is worth every single penny, especially when you are sat in the middle of a very busy pub!

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