Can estate agents really charge higher fees whilst reducing reliance on portals?

Over the last five or so years, it has been (sort of) acceptable to rely on portals as the equivalent of a business generating negotiator; coordinating viewings, suggesting alternative properties and agreeing sales. This is due to the fact that the market has been so active, and it is simply a case of choosing which of the interested parties from the portal enquiries is actually likely to buy the property. Of course, that isn’t estate agency.

News of estate agencies closing in the last 12 months has made gloomy reading. Perhaps some of these agencies were potentially overly reliant on portals and less so on skills, which would confirm that what the current buyer and seller audience needs is true expertise.

An estate agent needs to be able to position themselves as a trusted professional at the point when a customer is considering selling or buying, so it is essential that they offer more value than simply looking on portals, and negotiators shouldn’t simply push clients to the portals.

I have recently been looking for a property for my parents with an eye on them needing to downsize in the future, but I never see anything that I think is right. The truth is the type of property I need will never see the light of day on a portal, because it will inevitably be snapped up. I know that I will have limited knowledge in this particular search, so the reality is I need expertise and help. Not to mention the help my parents will need when they come to sell their grade II listed property. At the end of the day agents who can help the buyers as well as the sellers are the ones that will see real success.

The point is clear to me that the portals have been useful when the market is busy, and properties sell themselves. If you are happy charging low fees for low skills, then that is absolutely the right route for you. However, we need to move towards higher fee values – recognising the skill and knowledge that a good estate agency offers.

So, if you want to charge high fees for high skills – what should you do?

Firstly, every team member needs to be expert. Anyone who answers the phone should be a real specialist in their area. Every email or phone call handled needs to demonstrate expertise and skill as it has a value to the business. You need to stand out as the best at what you do. There should be value in every conversation, sharing of legal knowledge, updating of property market information and regular detailed communication.

If you don’t offer a VIP or equivalent mailing list, or hordes of advice guides, via social media, then you should. Don’t forget that in the world of social media, the ability to capture data offering expert advice has never been easier.

But what do you do with that data? How effectively you capture it and then use it will be the difference between success and failure. The buyer looking for a detached grade II listed property doesn’t want to receive calls about a Victorian two up, two down terrace. Accuracy and detail are key.

Here are some things I believe every estate agency owner or manager should be asking:

+ What real value does your agency offer?

+ How good is your data?

+ How good is your communication?

+ How well do your team question?

+ How confident is your team when it comes to having legislative knowledge?

+ How often are your team speaking to people? (If you think that no one wants a phone call these days, you are wrong – they just don’t want low value phone calls)

There is no magic bullet plan for business owners. There are simply good processes that take time to embed but that will absolutely deliver results.

Estate agency has always been a long game when done well and which is totally proactive in nature.

 

Charlotte Jeffrey-Campbell is a director at The Able Agent

 

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3 Comments

  1. WITMM

    Looking at the headline and to answer that question, I suspect the answer is ‘no’.

    A seller likely expects to see their property advertised on a portal, especially one they recognise and use.

    The general question of being able to charge higher fees is less driven by the strength of the market but by the number of estate agents available to choose from. The data indicates that the very unpopular solution to increased fees lies in having fewer estate agents.

    Looking at Companies House information and searching on Real Estate Agents SIC68310, at the end of 2023, 37,615 active businesses shared 970,540 transactions (figure from Land Registry).

    Only a decade ago, so in 2013 there were 9,361 active real estate agents sharing 1,067, 000 transactions.

    That means 10 years ago, the average number of annual transactions per business was 114, compared to 26 in 2023. Agreed, it’s a bit of a blunt calculation. An 80% drop in completions seems almost unsustainable. Averages can be a bit slippery and don’t allow for competitive distribution of sales i.e. there will be a localised rank order of estate agents. But it’s a data point that warrants someexploration.

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    1. jan-byers

      I agree totally.
      Add to that that estate agents is not a highly paid job anymore so people who may have done the job years ago now do something else.
      For example 2 guys who drink in my local.
      Gas engineer charges £400 a day – was moaning last week that he only earned 3k in December.
      Electrician who last year earned 80K

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      1. Gonzo38

        “estate agents is not a highly paid job anymore”

        Exactly, and why is that?

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