Mon 31 Jul 2017 View all news articles

Online estate agents - pro's and cons

Want to get the most from selling your home? You can market a property for just £99 - but the best online estate agencies will set you back more and still save money.

Deciding whether to take the plunge and sell your home? Well, this might provide the encouragement you need.

It's now possible for your property to be marketed by an estate agent for just £99.

99Home is the latest online estate agency to launch in Britain - and it believes it is the cheapest. That £99 fee gets your home listed on the agency's own website and, critically, on the Zoopla, PrimeLocation and Rightmove portals, where 95 per cent of buyers first look for a home.

99Home joins a string of other firms such as HouseSimple, eMoov and Sarah Beeny's Tepilo offering internet marketing of homes. Most charge £500 to £1,000. 

Purplebricks, the largest 'new-style' agency, says it beats online rivals because it employs some 650 property experts around the country to offer help to online sellers.

Another online estate agent is YOPA. It has a network of local agents who will value and market your home and negotiate to get you the best price. But as it does not have the costs of high street branches, it can offer to sell for a flat fee of just £839. 

Potential savings for sellers are large, at least in theory. The average UK home now costs about £221,000, according to the Halifax building society.

If you sold at that price with an online agent, you would pay a maximum of £1,000. But a traditional estate agent charging 1 per cent or 1.25per cent commission (some more) would cost £2,210 or £2,762.50 respectively plus VAT.

If you have a larger home - selling for, say, £500,000 - your online agency fee would still be £1,000, but the traditional agent's commission could be £5,000 or £6,250 plus VAT.

However, it pays to look beyond the headline figures, because some sellers using online firms do not 'save' at all. That's because the fee to an online agent is usually up-front and non-returnable. - a comparison website looking at which agents get the best prices in the quickest times - analysed homes listed by four leading online agencies over a year to see if they sold.

'Purplebricks homeowners completed on just 57 per cent of the listings. HouseSimple fared best, but only completed on 58 per cent, while eMoov and Tepilo were at 51 per cent and 48 per cent,' says GetAgent's Colby Short.

By comparison, the HomeOwners' Alliance consumer group says traditional agents with a local office sell more than 84 per cent of homes. The result is that online sellers who don't find a buyer are then likely to go on to instruct a traditional agent - meaning that they could end up paying two sets of fees to secure a sale.

On top of that, online agents' basic costs rarely include services which are standard from traditional agents. This has led the Government's National Trading Standards team - charged with policing the estate agency industry - to issue a warning.

'We've seen many examples of online agents making unsubstantiated claims about fees when compared to traditional or High Street agents. 

'It's wrong to make general claims about savings when the headline price does not include facilities such as a sales board, floor plans, photographs, accompanied viewings or other facilities normally included with traditional firms,' says National Trading Standards spokesman James Munro.

For consumers, the decision is whether they are prepared to risk losing their £1,000 or possibly end up saving many thousands more if the gamble pays off.

'Sellers who look carefully at their local market before listing their home for sale will probably still be better off instructing the best High Street agent in their area.

'For those looking for a quick sale, online agents are an excellent and rapidly improving option,' says Paula Higgins, of the HomeOwners' Alliance.

Source: Mail Online

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