Today’s graduates only understand the internet and the concept of going into a shop to buy a house is archaic.
Only one in two Countrywide viewings are accompanied it has been claimed, while Countrywide itself has said it predicts a hybrid agency model.
These were some of the thoughts expressed at yesterday’s RICS residential conference.
Rob Ellice of online agents easyProperty, said a Countrywide insider told him that “only every other Countrywide viewing is accompanied”.
On the topic of viewings, Ellice said, “There’s some funky things we’re now able to do. Rolling out virtual reality tours of property. But they’re now so good, the ability to now see what a property is like without going there is phenomenal.”
The debate headlined by easyProperty, Countrywide and Allsop ,was the main event at yesterday’s RICS residential conference.
The question put to the panel by Peter Bolton King, RICS grandee, was ‘Estate agencies: what does the future hold?’.
Ellice was asked to reflect on easyProperty’s journey to date from its lettings origin to the current state of full service for both residential and commercial property with 3,000 listings for sale.
Ellice specifically highlighted that “50-60% of landlords now transact for themselves” and that they’re a market “the industry doesn’t tap into very well”.
On easyProperty’s move into sales he said that customers “needed more hand-holding” which required “human elements” to the service. Sounding almost hopeful, he added that there was “no full tech play right now, but it will come in the future.”
When asked to explain the reasoning behind Countrywide’s new online pilot, Graham Bell, the London MD of Countrywide, said after looking at “parallels in travel and retail” they wanted to “make sure we’re not asleep at the wheel”.
Bell said they spoke to customers resulted in Countrywide launching a pilot “flexi product” in three of their businesses which gives their customers “control of their own transaction”.
He added: “We didn’t want to just bury our heads in the sand. It’s too early to say whether that’s a success. It’s not purely online. The future is probably a hybrid model.”
Andy Jones of Allsop Letting and Management started with a market statistic: “9,300 agency businesses in the UK in 2000 with 64 transactions per branch” and added that there had “been a more than 70% reduction in transaction volumes.”
With his own stats Ellice said that their research showed: “Only 3% of people find a home from walking through the door of a high street branch.
He posed the questions: “Do you need to be face-to-face? Do you need to be within five miles of a property or landlord? Do you ever see them?”
Adding that “online agent is not a particularly good term”, Ellice said: “People coming out of university don’t understand anything other than the internet. They don’t talk to people face to face. Everyone is communicating via a screen. The concept of going into a shop to buy a house is archaic.”
In a direct attack on traditional agents Ellice said “It used to be the case that you got to know your candidates so you could match them to a property. Now the software systems that do the automatic matching have made negotiators lazy.”
He summed it up with “It’s an order taking process, rather than being proactive (in matching applicants to homes).”
Jones chimed in to agree saying that in his recent experience buying a property “you register with agents and you never get a call back. You end up chasing the agents. It is strange how the local high street agents aren’t better at what they’re doing.”
As a glimpse of a probable future where the role of agents could change he highlighted that the property world should take a cue from it being typical for people to use “Google as a doctor” and then validate your own diagnosis by getting a “rubber stamp from your GP.”
Bell supplemented the view that the role of agents will change by saying, “Anyone who thinks the physical distribution of agency will be the same is kidding themselves. But retail still have high street branches.”
After the debate EYE spoke to the panellists where there was some discussion where agency could go the way of banks, where local branches act as referral points to specialist staff that aren’t necessarily branch based.
Bell supported the role of physical branches by explains that “not many people walk into a branch because they see a property they want to buy. 63% of buyers don’t buy the property they came in for. The value agents provide for the buyer and vendor is using the local database, understanding the needs and motivations of the people in front of you.”
Elaborating on the relevance of physical branches he said: “Most of the customers come to us because of an element of convenience. We can do the viewings.”
He added that with their new flexi product, “We wondered whether we need to do the viewings. Will everyone be comfortable doing their own viewings?”
Comments (41)
“A good agent will always earn his or her fee”If the industry is unable to get the message across that valuing ,marketing and selling your property isnt just about a cheap fee then something is wrong Bricks do a very good job of putting a lid on their horror stories .most poeple are familar with the phrase”quality doesnt come cheap” or never accept the lowest tender
Ultimately, Rob Ellice has mis-judged his position in the market, comparing himself – and selling shares on the basis of – being akin to Rightmove and Zoopla and the like. In other words, asserting his position as a portal… except that.. as we all know, he is NOT a portal. He is an estate agent with a website.
Every estate agency in the UK have their own company websites like Ellice, yet place their property instructions into Rightmove (etc).. like Ellice.
If Ellice wasn’t using Rightmove (for example), how many people do you suppose would even know he existed. As it is he is paying a fortune on internet ppc – far more than he is making on sales and lettings. He is only still in business courtesy of his investors and crucially – Rightmove.
Contrary to his propaganda spiel, he knows only too well that the service he is able to provide to his customers, is vastly reduced in comparison with any agent who has an office in the High Street and real local knowledge. His ONLY usp is offering cut price services.
I could start a website, raise millions by lying and tricking investors, then spend all their money whilst hoping against all hope that I’m not exposed for the fraud I would be.
Btw PeeBee, Clarke Hillyer did actually close its high street offices. It runs out of an industrial unit in Loughton.
Back in 1994, at twenty four, having invested all my savings (£8500), in opening my own estate agency branch, I turned over £108,000 in my first year, with one neg, a part time sec and myself. This was against a cost threshold of £52,000 (including my initial investment), excluding what I took for myself. You can see where I’m going.. by contrast Ellice spent millions to achieve a turnover under £145,000 in his first year.
He’s also badly mis-judged his sales market. Home-buyers (not house buyers.. subtle difference), treat home buying extremely seriously. Its a huge expense and risk. Absolutely they will look at Rightmove (the internet) and probably, they will look at individual estate agents websites (usually the agents they know in their area), but will they even know to look for sites like Easyproperty.com? I would say definitely not, unless they see a telly advert or some ppc ads on the internet… which means Ellice has to maintain his hugely expensive ad campaigns just to draw level (at best), with the local high street agents.
There is no doubt that technology and the internet will take an ever increasing role in the property ‘game’, but Ellice isn’t really a player!
‘Concept of going into a shop to buy a house ‘archaic’, says easyProperty boss.’
Spoof telephone call to ezyproperty:
Automated answer:
Hello this is ezyproperty, the new way to list a property Please press 1 for sales listing, 2 for lettings listing 3 for commercial listing, 4 for mortgages, 5 for conveyancing, 6 for removals, 7 for insurance, 8 for utility comparison, 9 for broadband and 10 to view a property.
Please remember to have your credit card available.
Hello, is that ezyproperty are you a real human being?.
Yes, how can I help you
I believe that you are currently dealing with 1 Threadneedle Street and I would like to view it please.
Have you seen the property advert and photo’s?
Yes, that is why I would like to view it please
Are you a graduate?
Yes, what on earth has that got to do with anything?
Well a recent survey has suggested that graduates don’t need to get a feel for a property by actually viewing it as they find it all too much bother, in fact, they find the whole process quite archaic.
I don’t understand what you are saying?
Do you want to make an offer?
Not without viewing first, are you not paid to sell?
Thank You for your call, goodbye.
An agents point of view:
I believe that when there is a shortage of property for sale/let the smart buyer/renter would be wise to call into the local agency branch and introduce themselves to the negotiator and build a relationship that may well put them towards the top of the list for new instructions.I have seen a substantial increase in such traffic in the past 12 months.
The ideal tenant/buyer is time poor.
If you think forming a relationship with a local agent will help these people achieve a better result, what are you doing to make yourself more accessible?
They can’t ask for what they don’t know they need. It’s up to you to get out of the office and find them/help them.
N’est pas?
If the question was ” What does the future hold?”, might I suggest that it’s in for a retro revolution? There is a surge in local, independent businesses such as micro-breweries, coffee shops and restaurants. Royal Bank of Scotland is re-branding 300 branches of NatWest to Williams & Glynn, HSBC similar with Midland Bank. “Consumers are interested in the effort that goes into creating the product/services they consume and the history and legacy of the brands behind them” – Ed Pilkington, Diageo’s West European Marketing Director.
Rob Ellice remarks that: only 3% of people find a home from walking through the door of a high street branch. (Perhaps he should give them more reason to do so) Do you need to be face-to-face? (It’s called a relationship Rob, and makes it so much easier to provide a service when there is trust). Do you need to live within 5 miles ( Community is part of most people’s way of life and those that believe in community will share values and help the community)
If he seriously thinks that computers can match up buyers with properties better than a professional negotiator, there is no hope for him. It’s only an “order taking process” when the agent doesn’t care about the vendor/buyer. Most consumers realise that and opt for the traditional agency.
Instead of whining about the lack of opportunity in the traditional model, how about making it better rather than bigger or more remote?
.
Hmm, while Mr. Ellice takes an extreme view predicting the death of high street agency, might I suggest your comment is equally extreme?
There are many people/circumstances where heavy hand-holding isn’t required. Currently a small part of the market served by (online) agents marketing a cheaper price.
But what if agents start opening up, from remote locations, that provide genuinely useful technology to help people sell their own home? Then you could feasibly see many use that service.
For many more transactions a hand hold is needed, but as people have access to more data they’ll have more confidence to DIY. IF they have the tools that also give them confidence.
I should say I’m trying to needle the extremity of your view, rather than saying this will definitely happen.
It’s worth thinking about. There’s no reason why that DIY service couldn’t cost more than traditional agency. That would make people take notice far more: if it costs more, it must be worth more…
I have read the story a couple of times now.
I still stand by that a number of the comments were plain stupid and self promoting but i thought i would share some thoughts as Rayhan makes a good point in the comments.
What does the future of Agency hold?
– I think this could be asked, how long are investors willing to pump money into a business idea that wants to buy a market place.
The truth is not a single perceived large player in the hybrid / online market have made a single penny in profit. Many have flushed millions away in advertising and supposed next gen technology. I will not name the companies through fear of having my comments removed but we all know who we are talking about.
Lets say investors are still happy to pump money in over the next 2/3 year period and then one or more of these online listers make a few hundred thousand maybe a million pounds in profit. How long will they then be happy to keep pumping money into these ideas until they get a healthy return on profit?
Lets say they keep going another 5 years and the company is making 5 million a year profit, Countrywide i believe in 2015 made an operating profit of 54 million.
So unless an online lister takes every property on in the market place given their current model of circa £1000 the model just does not work.
If an online lister did take say a massive 50% share in property sales, do you not think the portals such as RM and Z would change their offering and look for direct to market sellers, they will be better placed and would have to due to the demise of high street agents
You also need to factor in high street agents, online listers have contributed to fee erosion in recent years, our area most agents were 1.5% now most are going out at 1% or below. BUT the house prices have increase so bottom line has not been effected.
Unless one onliner becomes the “Amazon” of the estate agency world they are doomed to fail as the basic business plan is flawed.
As for tech i am still waiting to see just one idea an onliner has that the traditional estate agent does not offer or in the most case better, 360 degree pictures, virtual tours all started in high street agency, onliners are behind the times and playing catch up.
Wow! Kept that stored up for long? Might be interesting as an opinion piece.
Its just joined up thinking and what everybody outside of onliners / investors think that have done some research.
The only way an onliner can make money is dominating the housing market. Given that a number have been trying for a good few years now and not made a single penny in profit it looks doubtful they can make a sustainable business from it.
I understand why a number of people are trying this as they are getting paid handsomely to “Give it a bash” either by way of massively inflated shares or a big salary or even the inevitable merge / sale of company. The losers in time will be the workers, the investors and not to mention the public.
The person that should hang their head in shame in my opinion is Alison Platt. Offering an online option as along side to a high street offering is suicide given their business.
It may seem like a good idea now but they will live to regret it once the fad has passed. they will have lost market share, they will have helped drive down fees, reduced staff and offices when they need them the most. How that she is still in the position of CEO is beyond me.
As for the tech side these onliners, say a false line so many times even they start to believe it. What have a single online agent developed that is new and innovative? – Not a single thing!
Budget agents typically taking fees up front, have their funds in advance. many as order takers fail to be good at negotiating best deals. This leaves open buyer representation where goodnegotiators could trash asking prices down, where a vendor selling is represented by a poor listing agent, ie poor to negotiate best price.
There appears to have been valid points from all sides.
If a low cost stack em high model, then Rob’s view of the process becoming ‘order taking fits his model’
But Hg St offices carry local in the community brand value, that remind who trades in local agency. Important in keeping an agents name in mind for when people do want an agent.
For sure we’ll see hybrids and for sure more ‘customer hand holding can be done with more £££££’s in the pot.
Of recent I have seen some independents and corporates outstipping performance a budget agent could achieve via collaboration of local agents working together.
The biggest flaw in the UK is that most data is thrown about in a single directional data flow, thus restricting agents ability to work together and share listings and resources. This suits portals as their revenues could tumble in a B2B/ agent to agent platform as found in many other countries.
In the UK if you want insurance, a mortgage, the operative brokers and sources best products from the 100’s available. UK agents don’t do this. they only offer what they have.
It’s a shame this excellent comment is buried so far down. Maybe PIE’s commenting needs to be sorted by moderators or likes.
It appears to me that the on liners are buying market share in a vastly reduced transaction market and shall soon realize that to make any money they will have to substantially increase their fees, may be closer to what traditional agents charge in the ‘average’ market.
In the ‘average’ market place I believe that many independent agents charge a fair fee. Let us not forget that the average fee apparently is now around 1% compared to 6% plus in many parts of the world (I cannot understand why the traditional agency so called leaders are not countering the on liners spurious and in many cases inaccurate fee saving claims by highlighting stamp duty costs per transaction which is preventing so many people from moving – perhaps this is why the Government favour the on liners to try and offset their own ‘fees’)?
For this reason these on line companies shall have to look at these higher commission markets such as Australia and USA and even the prestige end of the market.
Perhaps that is why Z are re-marketing Prime Location as this market is where the on liners future profit may potentially arise in the UK – if they can hold out and appease their shareholders long enough.
By spending valuable UK shareholder resources in Australia, I believe that PB have acknowledged this. If this is the case, I wonder whether their shareholders were told that the UK was an experiment to fine tune their offering for the overseas market?
Maybe.
But, the concept of going into a local point of contact (shop) to sell a property… that still holds water.
The thought of having to deal with all your queries via an online / telesales platform. The experience of getting a different telephonist every enquiry. Mmmm… not so appealing.
Archaic concepts – errrr……adding “Easy” to anything, branding in Orange. Lots haven’t worked – failures include cinema, internet café, value, money, 4men, music, cruise and mobile.
Maybe for the landlord with a large portfolio or the housewife or retired person, being home and selling or letting your property yourself does work best, but the larger population who work a “9-5” (I’m out 7.30-8) run around after thie kids, and couldnt think of anything worse than standing in their houses talking to strangers, high street agents will always be wanted, it’s not the office people come to, we get several walk in’s a day but they are either tenants or exisiting clients, but what they do want is a professional in their house doing the viewing, do the negotiations and most improtnantly guiding their sale through to completion something internet agent fail to do over and over agin. So actually whats the point of an internet agent other than to scam people out of £2,000 when they could put a board up outside their own house and advertise in their local paper and propebably get the same level of interest and do the same ammount of work for £50. So who’s the real scammers, who’s the real let downs? Internet agent, people need and want high street, they don’t want to virtually view a poperty they want to get in and feel it, smell it, it;s emotiv not a head decision.
The future is…………………. Orange !!!
OK maybe not the colour, but mobile app based on a peer to peer basis.
I am available for expensive lunches should anyone want to know more.
hic!
How many viewings during the day when vendors are typically working, empty properties etc? I remember most of our viewings being during the day not after 6pm and weekends. Viewing online aides selection but buying a house isn’t like choosing a fridge online, it’s much more personal and for some, maybe most, requires a personal service to match.
So much positivity this morning. In all fairness to the panel, they were just responding to questions posed to them.
What at would you ask? And what do you think the future of agency looks like?
My personal view is largely the same as today.
People expect seismic shifts at all times – look at Brexit panic for evidence.
I’m with you Rayhan. Online/hybrid models are certainly picking up traction and recognition (if not actually competing with the old-skool as of yet) and any changes to the status quo will take place over twenty, thirty years – certainly not five.
People use traditional estate agency because it is part of the DNA of the transaction. It’s the same reason people go to car dealerships and travel agents. Until we actively teach younger generations that high-street estate agents do not offer the same quality of service that an ‘onliner’ does, and as long as high street estate agents don’t get knocked down and retain their visibility, expect the model to remain as it is for the foreseeable future. That’s just the way things go.
“Until we actively teach younger generations that high-street estate agents do not offer the same quality of service that an ‘onliner’ does…”
Sorry – you said WHATTTT?????
Hey, I didn’t say it would be the right decision or based in fact, or that I even agree with the statement. If I am ever lucky enough to buy a house (I’m in my 20s) I will use a high street agent, no doubt.
But think about business studies and economics classes for GCSE students, and parents talking to kids, and mortgage lenders speaking to customers, and newspaper ads, and online ads, and and and and and
Unless a shift in ideology happens, the traditional model will remain exactly that – traditional. The day visiting a high street agent becomes legitimately ‘archaic’ is the day that the online/hybrid model becomes legitimately ‘traditional’. That won’t happen on its own, it will come from education and exposure to different ways of thinking.
I expect the portals will have disappeared or completely changed tack in a few years.
Agreed. People have always and are likely to continue to move home on the following basic principles
1. Where do I need/ can afford to move to
2. Search for property in that area based on criteria
3. Narrow search down
4. View shortlist
5. Offer
6. Repeat above process until offer accepted and successful completion
The above process is location-centric. It does not require a national portal. Search engine technology and new methods of working are likely to make National portals as we know them today, redundant within a decade.
(Sets alarm clock for July the 6th 2026 to look for loopholes in above statement)
Agreed Chris.
I expect alternative disrupter tech to tread all over portals turf in the very near future.
At that point, expect shareholder hungry portals to fully bite the hands that have fed them.
I would not give it close to a decade.
I have in mind what I would like to see happen. I wish I could code.
I have in mind what I would like to see happen. I wish I could code.
You have access here to someone who knows someone who can – and does – code… like a whippet chasing the bunny!
Maybe you should see if your individual visions follow a similar path, Mr Walker!
I’m amazed Ellice even got a platform to speak. With the lack of success and unbelievable poor listings easy have managed, it would be like asking my mother to speak about the knitting and the wooden industry.
that should have been woollen clearly!
Maybe Mr Ellice’s slot was entitled An abject lesson in ‘How NOT To…’, RealAgent!
I see about 2 graduates every 5 years
As the kids say
“Who put 50p in the d**khead?”
*I am aware this will probably get removed but thought apt.
COMMENT OF THE WEEK/MONTH/MILENNIUM
hahaha….. LOL.
The angry bloke who was hoping to get back two 20ps for the toilet turnstile?
The only thing that’s archaic here is Mr Elice ! His reveloutionary business is showing a measly 400 odd properties on RM, a good number of which are new build, no doubt on even cheaper fees. Empty vessels !
I won’t make any comment of my own. I would simply like to quote from a brochure of a company by the name of Clarke Hillyer which I believe says it all:
At Clarke Hillyer we strive to stand out from other agents, not only in the way our offices look and feel, but by going the extra mile for our clients.
This is apparent from the moment you set foot into one of our bespoke air conditioned and comfortable branches. You will be greeted with a warm and friendly smile by one of our experienced and qualified property consultants…
The MD of Clarke Hillyer – who surely must have approved – even penned these words himself, perhaps?
That would be a Mr Rob Ellice.
What is this “Air…Conditioning” you speak of?
Nice relevant quote Pee Bee
It’s not like me not to voice an opinion as you know, Mr Mealham – but when it is said for you, you just need to point the finger in the relevant direction!
He lost me at “funky”.
nice try easy- money,.
If you are trying to offer a genuine service you need local staff. Local staff need somewhere to meet and remotivate
If your offering this level of service, paying a few more ££ to have a shop window is just icing on a cake.
Internet companies havent even worked out the ingrediants of said cake yet.
i.e. purpleshits service has evolved so much because the public wont give them a free lunch that they will have offices soon.