It's time to examine the definition of 'online estate agency'.
Channel 4's “Sarah Beeny’s How To Sell Your Home” brings the online vs high street debate to the fore. Featuring on the show, we've addressed the discrepancies and paradoxes that cloud the definition of online and its differentiation from traditional agencies.
With the first episode airing last week, Sarah Beeny's new Channel 4 show, How To Sell Your Home, is revealing the workings (and successes) of online estate agents operating in the UK today. But what is an ‘online’ estate agent? What makes it different to the local high street agent? What are the implications for the customer?
As founder and managing director of leading online estate agency, Hatched.co.uk, (tune in to episode 4, on 10th Nov to track the experience of Hatched vendors, Nana and Kozi Ampaw from Kingsbury, London), I will dispel the confusion surrounding the online vs high street debate by highlighting the differences (and similarities) between companies like Hatched and those operating from high street premises.
Unfortunately, an officially recognised definition of online estate agency doesn’t currently exist, so theoretically, an online estate agent could be any estate agent with an online presence. But then the vast majority of estate agents advertise their clients' properties online using the big property portals, Rightmove and Zoopla, as well as their own sites, so this would mean nearly all estate agents should be classified as online...
Rightmove, the property portal who some might say has been responsible for the proliferation of 'online estate agents' such as Hatched.co.uk, has an interesting way of charging these agents. This demarcation in terms of pricing could be considered a step towards differentiating the two models of estate agency.
Rightmove deems that if a certain amount of an agent’s stock (properties on the market), falls outside of a certain radius of the agent’s office, then the agent must be charged using a 'geographic pricing model'. This means that the ‘offending’ agent is charged for the number of properties listed on Rightmove, whilst a traditional agent (or an agent that doesn't fit the above criteria), will be charged on a per-branch basis.
However, as a possible attribute to classify online estate agents as a whole (all of which do indeed deal largely in nationwide stock out of one main hub or office), this definition is fundamentally flawed, as the obvious conclusion is that traditional high street agents who also cover large areas, should also be grouped together with online estate agents.
What’s more, most ‘online’ estate agents, like us, are not actually confined to one office, but employ representatives across the country who carry out the same services as those offered by ‘traditional’ agents (measuring up properties, taking photos, meeting sellers, coordinating viewings, etc), further blurring any possible differentiation with high street agents.
There are also hundreds of people who have set up an 'estate agency' from their bedroom or from a serviced office that only cover small geographical areas, so in the absence of a high street shop front, are they deemed to be ‘online’ estate agents too? Using the Rightmove pricing model, no, because their stock is concentrated in a certain area, which means they are charged per ‘branch’, even though they don’t officially have any ‘branches’.
So, rather than the non-high street presence or the geographical area covered in relation to stock, perhaps it is merely the low fee that defines an online estate agent?
Again, examples exist to negate this rule… There are a number of agents based in one town or city that cover the whole country that are charged the ‘geographic pricing model’ by Rightmove, but who also charge homeowners ‘traditional fees’...
There are a couple of firms in the Manchester area, for example, that are probably even more expensive than a traditional estate agent, yet only have one office, covering the whole of the country. Are they ‘online’ estate agents? Not according to their fee structure...
If I were to define an online estate agent, it would be an agent with traditional estate agency values, that uses technology to drive efficiencies in order to deliver the best online customer experience and the lowest and most transparent fee possible. At Hatched.co.uk, that is what we do.
Although, with a lack of physical presence on the high street, we are, indeed ‘online’ estate agents, I don’t believe the description does us justice, simply because of the fact that it leads people to believe that we offer a less personal service or work solely behind our screens, which is entirely untrue. I prefer the definition; ‘21st century estate agents’, with the key differentiator being that we offer a different fee structure (that also happens to save sellers lots of money). I'm confident that the way we do things at Hatched will become the norm within the next five years or less.
It's clear that there is really no such thing as an ‘online estate agent’ and that estate agents nowadays come in all shapes and sizes. But one thing’s for sure, whether it is ‘online’, ‘hybrid’ or ‘21st century’, a dedicated show such as How To Sell You Home is clear evidence that this new type of estate agency is gathering pace and that traditional agents, whatever they are, may well need to reconsider their model going forward, or face extinction.
Managing Director, Hatched.co.uk