Online vs. Local Estate Agents – What’s The Difference?
With online estate agents shaking up the property world, it’s vital to understand the basic differences between online and local agents. In this blog post, we’ll take a look at what makes online and local agents different, and help you choose which you should use when it’s time to sell your home.
The thing that attracts most people to online estate agents is, first and foremost, the price. Some online agents offer to sell your house for less than £100, and anything over £1000 is very rare for an online agency. By contrast, local estate agents generally charge around 1% of the sale price, which means on a £300,000 house, you could be paying up to £6000 in estate agents fees. This is the main reason people choose to sell their home with an online agency, as the upfront savings are quite significant.
Some online estate agents, like Purple Bricks, will offer a ‘hybrid’ service in association with local estate agents, to give you a local point of contact for home viewings and other services. These services will be more expensive than an online agent, but still less than a local agency.
However, you might find that the hidden costs of an online agency can add up very quickly. You might end up locked into using an online service’s in-house conveyancy or mortgage broker services, or be subject to extra fees.
You usually also have to pay upfront when using an online estate agency, which means that there is little incentive for the agent to sell your home quickly or for a better price, and if you decide not to sell, to switch agents or if the company goes out of business, you can’t get your money back. Some online agents do offer deferred payments, but these are often more expensive than the standard packages and you usually have to pay after around a year, regardless of if your home has been sold.
With a local agent, no sale no fee is quite common, and since they receive a percentage of the sale price, selling at a higher price is better for you and your agent, giving them an incentive to sell your home quickly, and at the best possible price.
Selling a home with an online estate agency will generally be a very hands on procedure for you, and quite hands off for the estate agency. There is often an online portal that allows you to see how the sale of your property is coming along, and gives you far more control and transparency over the process. However, you may well often be arranging or conducting viewings, negotiating with your potential buyers and the agent, which can be stressful and take up a considerable amount of time.
You might also find that while you can contact your online agent more frequently (some agents offer 24/7 phone lines), you’ll often speak to a different person every time, as it’s essentially a call centre, and information can easily get lost por missed between calls.
In a local agency, you’ll mostly be serviced by one agent who will work with you throughout the sales process. This is especially advantageous for more difficult sales, as you won’t have to explain your situation every time you call, and your agent will know everything they need to about your home.
A good local estate agency will take on most of the legwork for you. This means that they’ll be progressing your sale and working to find you the best possible buyer behind the scenes, even when you feel like you aren’t hearing much from them. They will be able to conduct viewings on your behalf and help weed out any time-wasters before you even need to interact with them. This approach can save you a considerable amount of time and effort, and really reduce the stress associated with selling your home.
While some online estate agents like Purple Bricks now offer a ‘local’ service with an agent you can contact in person, you should always check how wide their sales area is, and the knowledge they have of your area, right down to the street you live on.
Most online agencies will use online data to value your home, which can often be inaccurate, as their valuations aren’t as informed or hyper-localised as with a local agent. They also won’t take into account other factors inform the value of your home, such as decor, the distribution of the space in your home and the street and local area it’s situated in. This includes things like transport links, schools, building works, and the potential of the home.
With a local expert agency like Jordan & Halstead, your agent will know the local area and its property market inside and out, and can give you honest advice and accurate valuations to ensure you get the best possible start to your home selling journey. As a local agent, we are also able to advise you on how to improve the value of your property as well as giving you an accurate valuation for its current state.
While the upfront costs of an online agency are generally far fewer, the value and price you’ll actually get with an online agent are generally slightly lower. Independent property experts at TheAdvisory found that on average, buyers introduced to the property by a local estate agent paid 5% more than the highest offer from a buyer who found the property online.
This is especially significant when you consider the fact the most local estate agency fees are around 1% of the sale price (TheAdvisory actually puts the average rate at 1.18%), meaning buyers selling with local agents were actually receiving a walk away price that is at least 4% higher than what they would have received from an online agent, and that’s without including the online agents fees!
While the low fees offered by online agents can be tempting, the evidence shows that it’s actually better value overall to use a local, knowledgeable and experienced estate agent to ensure you get the best price and value out of your home. To sell your home with a true local expert, contact the team at Jordan & Halstead, and see how we can help you get the best value and the best results from your property.