Zoopla has launched a partnership with iamsold, which, it is said, will help agents expand their services and commercial opportunities by selling properties via the Modern Method of Auction.
A consumer marketing campaign in the coming months will highlight what are promoted as the benefits this type of auction brings to both buyers and sellers
It will also educate homemovers about the benefits of buying and selling properties at auction – speed, security and transparency.
In the Modern Method of Auction, prospective buyers place bids on a property within a given timeframe.
At the end of the auction, the highest bidder must pay a substantial, non-refundable reservation fee to secure the property and then has 28 days to exchange and a further 28 days to complete the purchase.
In the case of iamsold the fees range from 3% to 4.2% including VAT
The firm says that there is a 95% completion rate on sales agreed by this method, compared to 75% for traditional sales, and that the fixed timescales deliver faster purchases with completions taking up to 56 days compared to 14 weeks for traditional sales.
Commenting on the partnership, Andrew Marshall, Zoopla’s Chief Commercial Officer said:
“Our mission at Zoopla is to be the agents’ champion and by partnering with iamsold we believe we are doing just that. Our research shows property auctions are misunderstood by many agents and consumers alike but we are confident that in iamsold we have a partner that can help us bring auctions to a whole new generation of homebuyers who might have only ever seen them on TV.
“The benefits of selling at auction for agents are clear. Faster sales, higher completion rates leading to an increased rate of return. It’s also a great way to bring to the fore properties that might have previously struggled to get the attention they deserve. We firmly believe that all of this, combined with Zoopla’s reach and recognition, will be a winning combination for agents in the months and years ahead.”
Jamie Cooke, managing director of iamsold, added:
“We founded iamsold to offer an effective solution for vendors needing to buy or sell properties quickly and securely, and during the last 10 years have grown a strong network of over 2,500 estate agent branches. The future of auction is online which is something we have pioneered, so it’s incredible to see this recognised by Zoopla as they expand into this territory with our partnership.
“Although the Modern Method of Auction has many benefits, it’s little known amongst the public, with just over a quarter of UK homeowners who we surveyed recently aware of it. However, in the current climate there is a sudden need to move for many due to unexpected lifestyle changes. Millions of homemovers visit Zoopla each week and with this partnership we hope to make auction a mainstream way of moving and arm more agents with this solution to go to their clients with.”
Although undoubtedly suitable for sales in certain circumstances, Modern Method of Auction is not without its critics.
In a BBC ‘You and Yours’ programme at the end of last year the fees were described as ‘astronomical’, with one listener saying that in a modern methold of auction sale the agent would have received a considerable sum of money “for not doing very much”.
Paula Higgins of the HomeOwners Alliance – which has called the world of modern method auctions “murky” – said sellers should be told that savvy buyers will factor in the fee to their offer price, and that sellers should also be aware that there is a big incentive for agents to offer the modern method of auction as a sales route, rather than private treaty.
The programme referred to The Property Ombudsman’s advice to agents that they should explain the pros and cons of the modern method of auction so it will be interesting to see how Zoopla addresses that when they begin the marketing campaign.
It is not the first time that Zoopla has got involved with auctions.
In 2010 it partnered with REDC, to offer online auctions via the portal. Although not by Modern Method of Auction, the first sale saw 57 properties sell under the hammer.
Back then the offering was promoted by Zoopla saying: “The model appears to be a win for all concerned in the property market with buyers able to purchase in a transparent way with certainty of outcome, sellers having a new route to market reaching a wider audience to maximise the price achieved and agents still earning their fees for properties that they put into auction as part of their marketing process on behalf of sellers.”
Some time later Zoopla quietly dropped scheme.
Comments (11)
Coincidentally, is Mark Goddard still Non executive Chairman of iamsold? Glad to see he kept good relations with Zoopla after parting company, I always thought highly of him.
Trust Zoopla!
I have been saying for some time that in the portal arms race – Zoopla will convert to a sales platform, in order to trump Rightmove, the inclusion of auction on Zoopla and its heralding this as a better solution than private treaty will be very interesting.The grey area is indeed fees, at auction some agents are charging the buyer 2% as a fee, which in my mind must lessen the selling price as it would need to be factored into the transaction, eg I bid 500k, but as I have to pay 10k to the auctioning agent I will bid 490K to compensate.The compelling immediacy of auction is brilliant, but the halfway house the 28 days to exchange for me is a bit of a fudge, having overseen maybe 18,000 sales in 30 years of being an agent, an exchange on the gavel is worth far more than a hope of an exchange dependent on factors that are yet to come over in the next four weeks.Lockdown has given real estate a reset button for sure.
‘Some time later Zoopla quietly dropped the scheme.’ Me thinks history will repeat itself.
Wow – a MASSIVE conflict of interest, here.
Zoopla, which is meant to give estate agents all the tools necessary to fulfil their legal obligation of striving to get the best price for the vendor, is now looking to “educate” people of the opposite.
“Modern Method” is an awful way to sell property. You will never, ever get the best price using this system due to the inflated buyer fees, which clearly are taken into account when the buyer makes an offer. It’s no better than the “dutch auction” methods that literally everyone hates.
There is nothing good about “Modern Method”. The only reason estate agents push it because they can earn bigger fees from it. There can be no other reason. If you want to auction your property, then just auction it. It’s quicker, cheaper, more efficient, and at least no-one is pretending there that it gets you the best market price.
The article misses the fact there that is a minimum fee of £5000 + VAT. On a £50k property, that’s one hell of a percentage!
Too right. In that price range it’s the difference between a vendor being able to afford to sell, and not.
Ironically, publicity is the last thing Iamsold needs. At the moment they fly under the radar with a few desperados using the service who dont understand that those huge buying fees put most buyers off and that ultimately its taken from the value of the property. If this gets brought into the public eye you can bet all the consumer watchdogs will have a field day exposing this one.
And so it starts.
The portal which positions itself as the ‘more affordable’ for agents, off sets its reduced revenue capture in the form of cosying up to a supplier. What next Zoopla, a preferred solicitor; surveyor or lender? After all, a quick look on the website indicates that I Am Sold Group supply all outlets.
So, if a home-seller researches and seeks advice via a portal, surely now impartiality has evaporated? What is in it for Zoopla for promoting a supplier? What of the agents who pay subscriptions to the portal, but offer an alternative to what the portal is promoting? Is this not a conflict of interest?
Are we now witnessing the beginning of the property portal positioning itself as a direct competitor to the high street agent? So many larger businesses within the industry getting in bed together; backed by self proclaimed ‘titans’ within the same industry – the opportunity of choice for the consumer (home seller and agents alike) is being diluted at the very point, where by variety is supposed to be offered – the portal. Then again, perhaps I am simply naive. The idea of agents positioning themselves as being different from their competitor, will probably be all the more challenging from here on in.
4.2% paid by buyer – ouch!!!
“4.2% paid by buyer…”
…or some might say it is 4.2% lost by the vendor, PPITE.
Discuss.