Some estate agents believe that more than 50% of homes sell with a second agent, but this is simply not true, according to property data and analytics company TwentyCi.
“This stat regarding more than half of homes being sold with a second agent has been floating around the market for a number of years,” said Katy Billany, executive director at TwentyEA, part of the TwentyCi group of companies.
“This statistic has often been quoted by industry leaders and PropTech suppliers, and typically goes unchallenged, but our findings suggest something very different,” Billany added. “And may come as a surprise to many.”
Fresh research conducted by TwentyEA found that, in 2021, just 6.2% of sellers actually switched agents.
Even when you take into account that 8.2% of new instructions were multi-listings, this means more than 85% of new instructions in 2021 were off market (i.e. from people whose properties were not already on the market), TwentyEA’s study found.
“It could certainly be claimed that 2021 was a unique year in the fact that there was such a large supply-demand imbalance,” Billany continued.
“As a result, it was nearly impossible not to sell a property as there were so many buyers fighting over what little stock came to the market. This argument does have some merit, so we decided to analyse the numbers going all the way back to 2017 to check if this was an anomaly or not.”
The study also revealed that the year with the highest number of sellers switching agent was 2019, but this figure was still only 9.1% of the overall market.
According to TwentyTA, the average over the last five years is just 7.7%, and a further 10.3% of instructions were multi-listings.
“On average, then, some 82% of all new instructions were off market [in other words, not already For Sale] over the past five years,” Billany said. “That’s a staggering number.”
“Of course, not every property that is listed goes on to sell, but the big question we have had to ask ourselves is – how many properties did sell after switching agent?”
TwentyEA says that nationally, on average, 71% of properties listed will actually end up selling. But when listing with a second agent, that drops to an average of 50.8% between 2017 and 2020 (ignoring the 2021 figure as around 30% of transactions are yet to be concluded).
“So, not only do you have a lower chance of actually selling at all, if we look at the number of exchanges from properties listed with a second agent as a percentage of the total number of instructions, between 2017 and 2020 only 4% of listings achieved a sale after switching agent – not the 50% that is often stated!” she added.
Why is all this important?
TwentyEA says now the idea of many sellers switching agents has been successfully debunked, the next question to agents is naturally: ‘what are you doing to attract the 82% of ‘off market’ properties that come to market?’
“Typically, many agents will spend a large chunk of their marketing budget on ‘prospecting’ or ‘touting’ the properties of their competitors at various trigger points throughout the seller’s journey,” Billany explained.
“But we would argue that actually the large majority of your marketing spend should be focused on the pool of people who still haven’t listed yet but are looking to move. Whilst ‘agent switching’ activity will always be part of the mix, the stats clearly show that it shouldn’t be the main focus of agents’ marketing campaigns.”
Billany says the size of the market of those unhappy sellers looking to switch agents is relatively small, so it makes sense to focus on a pool of potential sellers that is much, much larger.
If they truly believed their press release would they also advise us to stop paying for their re-targeting data and mailing campaigns for old on market stock?
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There was nothing like being invited to a property already on the market with another agent who had failed and then have the owners change the marketing as per your advice but stick with the original agent…
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time your visit as too early with the vendor tied in will only result in the current agent benefitting from your advice, I only ever go if in the last 10 days of their sole agency period, otherwise waste of my time!
Its only the corporate valuers/listers that have to tick boxes that will go at anytime.
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For decades touting was the insidious practice of Cowboy Agents who rarely survived. Thanks to corporates like Haart it has become far more common (though no less insidious)! When I worked for Sequence part of course of Connells I was told to ‘knock’ 10 other agents boards a week. When I didn’t I was severely pressured to the point I had Clinical Depression & put on medication. I was even given a manual entitled ‘Touting’.
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I did door knocking when I worked in Reading we all did Sales staff got 1/3 of the commission when a house was sold if they introduced the instruction
We also had the elctoral roll in the office and the old phone book.
Every Thurdsay look at the paper to see what is on the market and get out to knock it.
Niothing better than kniocking on a door, asking how it is going, being invited, in and getting an instruction.
I remember the vendor in the University area who write a complaintletter aftet I knocked on her door to the CEO of Lloyds Black Horse.
2 weeks later she came in ansd askd if I really did think we could sell her house.
Sale agreed at asking price next day.
To me it is real selling not order taking. Everyone I worked with loved doing it We gained many sales from touting
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I appreciate that this is a sales article, but someone needs to put this article in front of the “manager” of Romans Ltting in Bristol who write to me, they don’t know my name but have my private address, touting every time one of my rental properties appears on Zoopla. They claim it is not a breach of GDPR, failing to understand that I would not now use them if they were the last agency in Bristol.
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Perhaps exercise your Right to Erasure: https://ico.org.uk/for-organisations/guide-to-data-protection/guide-to-the-general-data-protection-regulation-gdpr/individual-rights/right-to-erasure/
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I spent years (decades!) touting. The return on investment was miniscule at best or even negative.
There’s at least one reason you were not called in to value it in the first place. Or there’s at least one reason you did not get instructed if you did go in to value it.
Those reasons do not magically vanish because another agent has failed to sell it in 6 weeks.
The phone calls I made to lost instructions nearly always reminded the owners of my sensible “on the money” pricing suggestions. BOOM! Price reduction achieved for the instructed agent and they didn’t even have to have “that difficult conversation” about how they overpriced it to win the instruction. Property then sells and the lying agent gets their commission.
I hated touting. SUCH a waste of time.
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“abso ****** lutely” agree and I guarantee those who say, oh yeah I door knock every week and I get loads of instructions are liars and/or bespoke self employed agents who get convinced that its the thing to do, by those earning off of them further up the pyramid.
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Door knocking……its just begging!!
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