According to research by Britain’s leading online estate agent eMoov.co.uk, high street estate agents are still more expensive than professions such as doctors and lawyers, charging the equivalent of £870 an hour to sell a property.
A year ago eMoov.co.uk released research highlighting the extortionate rates charged by the traditional high street estate agent, in comparison to other industry professions. The results showed that it takes between 5-15 hours for an estate agent to sell a property once they have valued it, marketed it via online platforms, hosted viewings and seen the deal over the finish line.
A year down the line and not only is this still the case, but the commission they make equates to an hourly fee of £870. Traditional high street agent are still surpassing that of other industry professions such as lawyers, private doctors and physiotherapists when it comes to the cost of their service.
The latest research by eMoov.co.uk further highlights the abnormality of estate agent fees when compared to that of other industries with much higher barriers to entry, usually requiring multiple qualifications for an applicant to qualify. With the estate agency sector still by enlarge unregulated, for the majority becoming an estate agent takes little more than possessing the gift of the gab.
With the average fee still at 1.6% estate agents take home commission in the region of £4,352 on the sale of an average UK house (ONS: £272,000). As a result the equivalent hourly fee can run to as much as £870, for what is essentially very little work, when compared to that of the other professions listed.
When you start to consider properties above the average UK price, this sum begins to spiral to unfathomable amounts of money. London in particular is an area of the country in its own bubble where the property market is concerned. The soaring demand for London property has seen prices across the capital rocket, although it has cooled in recent months there are parts of central London where property still fetches a price tag of £2m+. For the high end estate agents dealing with these sales and charging as much as 2.5% of the property price, this equates to an hourly rate of £10,000, absolute lunacy.
Russell Quirk, founder and CEO of eMoov.co.uk said:
“Not only is the average price of an estate agent completely disproportionate to the service provided, but the fact that someone selling a property for £1m+ has to pay a phenomenally higher price than someone selling at £100,000, is ludicrous.”
“The service you receive should be the same, regardless of whether your house is £100k or £1m, therefore the price you pay should also be the same. It highlights yet another downfall of the high street model”
Since launching in 2010 eMoov.co.uk has grown in size year on year. Offering a flat fee of just £495+VAT and saving sellers £4,628 on the average UK house, they offer the same service as a regular estate agent with the exception of accompanied viewings. The popularity of their business model is evident as they have been joined in the sector by a number of competitors over the course of the year. Not only has the sector seen considerable investment, but eMoov themselves just secured the investment sum of £1.5m from venture capital firm Episode 1.
One of their recent customers Michael Gallagher from Chelmsford in Essex saved £17,600 by selling his five bed detached house through eMoov.co.uk. Yet more proof that selling via an online estate agent is possible regardless of the type or scale of the property you are selling.