I’m not one to disguise my distaste for the high street estate agency business. Having worked within it in the past, I have seen the inner workings of an agency and, whilst I understand why this model continues to exist in the UK, I don’t agree it is right for all consumers in every instance. Working as a mortgage broker within a large corporate estate agency chain for close to four years, I typically saw two sides of the coin, whereas the agents only saw one. Due to the nature of my role, I would work with the buyer, organising finance and helping them make the purchase – whilst also being involved in the day-to-day marketing and running of the estate agency that mainly focused on looking after the vendor. In fact, estate agents almost considered buyers the enemy, someone to be cynical of and untrusting.
Finding an Estate Agent – not always an easy task
Transparency is something I highly regard, and something I saw very little of during my time with the corporate. Whilst I can understand the rationale behind it, I don’t think it’s a healthy way to run a business. But what I found most shocking was the way in which the agents managed the property vendors. Having an almost open distrust of one side of the equation you would think they would be bending over backwards for the other. Not the case!
From the outset, the vendor would be stage-managed. When first making the enquiry, a set of questions were asked in order to reveal key information that would be used in the sale process: “What attracted you to the home”, “Who do you think would appreciate your home”, “What do you think its worth”. They seem innocuous enough but when you understand how attached people are to their homes, these questions become powerful sales tools – and allow the agent to create a great first impression. They would admire the features you regard the most, paint a picture of the perfect new owners and, most importantly, pin a figure in your head that matches your own hopes. From there, the agent would start producing statistics, carefully screened to show the agent as being the dominant factor in the area, and promise a tailored, bespoke service all whilst signing the client into a three month contract.
You would also think that the agents would be careful about the homes they aim to get onto the market, but it’s becoming increasingly common for them to charge some small upfront fees. As a result, the agencies’ marketing costs are likely to be covered and, even if the house does not sell, they get another board up in the street, another statistic to feed to Rightmove and Zoopla, and another property for their shop window. Each of these tools works to attract more and more vendors to pick up the phone when they start thinking about selling.
GetAgent – the next big thing?
And there you have it: an estate agency marketing model in a nutshell. The problem is, none of it distinguishes a quality agent from ones who simply run a glorified classified ads service. This is where GetAgent, an estate agent comparison site, steps in, a service that separates the wheat from the chaff of property listings. It works by analysing the agents that sell property effectively, and differentiating between those that simply list properties. The process works in two parts. Firstly, their in-house algorithm rates the agents in your area, considering factors such as the final percentage of asking price achieved, the time to sell the property, the volume of sales they achieve, how they perform for the type of property you own and how many of the portals they subscribe to. Handily, it is because of this that you are able to whittle the hundreds of agents in the area down to a select top twelve of the most effective. Some of the results might surprise you; sometime huge corporate agents perform well and at other times smaller independents manage to stand head to toe with their larger competitors. However the results come out, everyone is assessed on their merits.
The second stage ensures the client gets value for money by inviting those top twelve chosen agents to bid a commission of the agency fee to GetAgent to secure your instruction. Whatever the winning commission bid, GetAgent returns 50% of that to the vendor by way of cashback. This method ensures that vendors get to balance quality with value for money. Many agents spend a lot of money ensuring they make phone calls to their vendors, and those expensive ‘state of the market’ brochures many Londoners get through their door don’t come cheaply either. However, with the demand in place for them to focus on their core metrics and excellent customer satisfaction, they can spend less time selling their services to vendors and more time selling their houses to potential buyers. All in all, GetAgent is a welcome shake up of a very stagnant business model.
I’m looking forward to seeing a day where people judge estate agents based on word of mouth, recommendations and reviews, and generally on their overall quality, for vendors and buyers alike. Currently, we are more likely to base our decision on the price an agent thinks the home could sell for. If we applied the same model to brokering mortgages we would have mortgage brokers quoting clients the maximum mortgages they think they could get them which would be terrible for clients and bad for business as a whole. Imagine a time where you invite an estate agent in and actually trust their advice? GetAgent could be on the forefront of the movement in that direction.
Speaking to co-founder Colby Short, it’s clear that they have some interesting plans for the future too. He hinted at developments that would improve automated valuation systems, inviting homeowners and agents to contribute to the process to remove the anomalies that trip up the current, entirely computer-based systems. Colby also talked about developments on the website that will provide homeowners more data to help to them decide on their preferred agent.
Ultimately, GetAgent is a welcome addition to the property market and one well worth considering if you plan to sell in London in the near future.