Compared to their traditional high street counterparts, online estate agents are relative new kids on the block. According to their TV ads they offer all of the same services as high street estate agents, but with dramatically reduced costs. So how do they do it?
The most obvious reason for their lower costs is – ironically – real estate costs. Whereas high street agents have the overheads of rent and business rates for their shop fronts, online agents are solely web-based and can therefore pass any savings on to their customers.
Many online estate agents are also backed by investors who are keen to see them gain market share quickly. In some cases this means that online estate agents are offering slightly subsidised promotional fees at the moment, making it a great time to take advantage!
But is this all a bit too good to be true? To find out, we’re going to look at the advantages and disadvantages of both online and traditional estate agents.
High Street Agents
Advantages
Personal service
- This is perhaps the most obvious benefit of going with a high street agent; a personal service. Although many online estate agents now offer dedicated local agents, the ability to just walk into a high street office is reassuring to many.
Accompanied viewings usually as standard
- Conducting your own viewings can be a daunting experience, and although many online estate agents now offer this service for a small additional fee, it is often included as standard with high street agents.
Experience
- Many local estate agents have been born and raised in the same area that they cover, giving them a good knowledge of the local property market.
Disadvantages
Expensive
- As mentioned previously, high street estate agents will often have greater overheads than their online counterparts. This includes rent for their storefront, business rates, staff, etc. These extra costs mean that you end up paying more for their services… and in some cases a lot more. The usual commission for a high street estate agent is 0.75% – 3% of the final selling price (often + VAT).
Not 24/7
- Whereas many online estate agents will offer a 24/7 portal for managing house viewing and receiving offers, traditional estate agents tend to work to more traditional hours.
Online Estate Agents
Advantages
Cost savings
- This is the big one. Whereas the average estate agency bill in the UK is £5,247, many online estate agents offer similar – and in some cases the same – services for a fraction of this price. YOPA, for example, has a fixed fee package of £889.
24/7 support
- Want a late-night check-in to see if there’s been any interest in your house? Perhaps it’s Sunday and you want to plan your next week’s worth of viewings? With most online estate agents, this isn’t a problem. Simply login to your 24/7 account and off you go.
Local agents
- There is a growing breed of online estate agents who also have local agents on the ground in your area, in much the same way as their traditional, high street counterparts. These type of businesses are often referred to as ‘hybrid’ estate agents, and here at YOPA we’re one of them!
Disadvantages
Add-ons
- Some online estate agents offer services (such as accompanied viewings) as an added extra. However, it is worth remembering that even with these added extras, most of the time online estate agents still work out being considerably cheaper than traditional estate agents.
Upfront payment
- Whereas many high street estate agents will take a percentage of the sale price as commission, most online estate agents require upfront payment. Some online and hybrid agents do offer the option of payment on completion, but these packages tend to be slightly more expensive.
Which is right for you?
These days, there really isn’t much difference between major online estate agents and their high street equivalents, and regardless of which avenue you go down, our main recommendation is that you do your research first.
With that in mind, here are some other articles from YOPA’s Homeowners’ Hub that may be of interest:
