The Truth About Selling Property Online
Selling property online, is no longer something we can choose to do or not to do, it is quite simply how most properties are sold, with studies finding that as many as 1 in 2 home-buyers today find their home on Rightmove alone, if you widen that to the internet it is likely to be around 70%-80% of buyers find their home, and this is confirmed by the fact that estate agents currently devote 80% of their advertising budget to the internet.
This growth in the internet has greatly widened the possibilities of home-owners selling their own homes privately through private sale websites like Tepilo and the Little House Company.
Estate agents don't want you to do this, and information is often disseminated that can make it sound very difficult indeed. The truth is that it is not like the past when the only way to sell was with a high street agent and we just had to swallow the 2% commission; today no one has to pay a high street estate agent 2%, it is not impossible to sell privately online, or even difficult, but above all else the truth is that now there are other options out there and it is purely a matter of choice how you sell your home. Let's look at those options shall we?
Selling Privately Online
Today there are literally hundreds of private sale websites that allow you to list your property for a fixed fee at prices ranging from zero (yes, that's right free) to £500, with £150 being about the average. You have the big 5, Ebay (Free, but small fees for additional imagery), Gumtree (Free) The Little House Company (free with optional add-ons), Tepilo (Free), Houseweb (£125 full featured ad).
These are not only the biggest sites in terms of traffic and exposure including press coverage (Little House Company regularly appears in the nationals and has featured on and ITV News Documentary and BBC News, and Sarah Beeny is the owner of Tepilo), but are also chosen because they are all strictly publishing companies, meaning that if you dual sell with them you pay no commission to your estate agent. More on dual selling later.
There are thousands more private sale websites, and niche selling sites out there, the best way to find out which to use is to search on search engines for homes for sale in your area, the top results will net the most search engine traffic, while the sites above will bring traffic from their overall brand exposure, recognition and search engine traffic as well.
Of the sites above you should definitely advertise on Tepilo, Houseweb and the Little House Company, because it will get your home onto Fish4Homes, which is one of the UK's biggest property sites, and other property search engines like Nestoria, which crawl property sales sites and index them like traditional search engines, but with property-friendly display pages. Nestoria is in the top 10 for many searches like houses for sale in Birmingham.
Traditional Estate Agents
Some of you may wonder why the above heading has traditional in it, instead of just estate agent, all will become clear, and for you it will be a very exciting revelation – maybe.
Anyhow, traditional estate agents refers to the way we have traditionally sold homes for decades, finding an agent on the high street, from surrounding for sale boards (the ones that disappear quickest), the Yellow Pages or even the internet. An agent who will come to your home, put up a for sale board, and advertise in the press and on the internet, and handle viewings and negotiations with prospective buyers on your behalf.
Online Estate Agents
Now you get it. Online estate agents are a new business model that takes estate agency and converts it to focus solely on where the buyers are; the internet. Online estate agents don't have high street offices, because they all work from a central location focussing on online advertising and marketing. They don't have company cars because they don't do valuations or give for sale boards (although some will offer both as add-on services), or handle viewings. And they don't advertise on other methods like the press, which for ages have been known not to bring sales, but are still used by agents to gain exposure with sellers, and because sellers still expect to see their ad online.
The savings that they make in overheads from these differences allow them to operate on a fixed fee basis, with the average being around £250.
Which Option is Right for You?
If all of this is new information to you, you may immediately think that private sales is the way to go, especially if you feel confident about handling your own valuations (there are many guides online), viewings and negotiations. However the big drawback with private sales sites is that they have been banned from the industries biggest portals: Rightmove, Zoopla, FindaProperty and Primelocation.
These sites are by far the dominant ones when it comes to buyer exposure. Rightmove revealed traffic figures for January showing it had 13 million visitors and 795,280,583 page views in one month, that means that approximately 1 million properties were being viewed every hour. So it is hardly surprising that recent studies have found up to 1 in 2 home buyers have found their property on Rightmove.
Between them, Rightmove, Find a Property, Primelocation, Zoopla and Fish4Homes get the majority of internet traffic from British property buyers and of course, less so, sellers. If you have bought a home, or even considered it you will know this to be true (which of the above sites did you go to straight off the bat, or was it a Google search? Answer in the comments).
The next best thing is an online estate agent, because they get you onto those portals and you still don't have to pay the hefty 2% commission charged by high street agents. But of course, if you don't feel confident about valuing your home or handling viewings and negotiations then a high street agent is your best bet – some online estate agents will offer these as add on services, but the packages usually end up including a fixed-fee up front, plus a percentage commission which kind of defeats the purpose.
Dual Selling: The Best of Both Worlds
Thank fully it is not an all or nothing choice, you can have an estate agent (online or traditional) and advertise privately to try and avoid paying their fee, which will consequently make the agent work harder in most cases as well.
There are 4 types of estate agent agreement, Sole Selling, Sole Agency, Multi Agency, and Ready and Willing Purchaser. The main two in use in the UK are as follows:
This is where only the estate agent can sell your house. If you find a buyer you still pay the fee, this is the best deal for the agent.
This is where only one estate agent company has rights to sell your house, but if you find a buyer you don't pay the fee. This is the best for dual-selling, but you have to be careful. A recent OFT study deemed that you would still need to pay the estate agency fee if the site or company you found the buyer through could be deemed to be doing estate agency work. The press sensationally hailed this as an end to dual-selling but this was ludicrously wrong.
Many private sale websites had taken to sending out for sale boards with their company advertising on, this was deemed to be estate agency work, and if you found a buyer through such a site you would still be liable to pay the estate agency fee, because the court would rule that another agent had found the buyer. But as long as the private sale site you used can not be deemed as doing estate agency work then you are completely fine to use them for dual-selling and will not pay the agents fee if they find the buyer.
The 5 companies listed in the private sale section of this article are all publishing companies, and are not engaging in activities that could be deemed estate agency work, therefore they are safe to advertise on under a sole agency agreement. The work the OFT deemed estate agent activities is as follows:
- Sending out property particulars and arranging viewings.
- Receiving and fielding queries from potential sellers or buyers and passing on details to your clients.
- Providing clients with a 'For Sale' board and/or putting it up outside their property where the board contains [The Private Sale Company] contact details.
The above is quite a lot of reading I'm sure, but the main thing is that with the mass-adoption of the internet into our lives, home selling in the UK is no longer an open-and-shut case of choosing which high street agent to use, there are choices out there and opportunities to make savings.