We often are instructed to act for both buyers and sellers transacting with an online estate agency. As with all transactions there can be hiccoughs along the way. They can occur whichever type of agency you chose. As lawyers, our experience of these transactions is often mixed. So here’s our guide to deciding whether to go down the traditional route of the High Street agent or the online route.
The Pros of Online Agency
The biggest draw to using an online agency is usually the reduction in agency commission. Traditional Agents tend to charge between 1 and 4% of the sales price at completion. Most online agents charge a one off fee upfront with no commission to be paid when the sale goes through.
Online agents call centres tend to be open outside of traditional office hours and at the weekend. High Street agents tend to be less flexible in this regard.
Sellers have more control over the sale of their property, from conducting their own property viewings, to negotiating the sale directly with the buyers.
The Downside to Online Agency
You are in effect (once the property goes on the market) in charge the whole selling process. The fact that you often have to deal with this single-handedly may not appeal to some and there can be many hurdles to clear.
Firstly, if you are selling, you usually have to conduct your own viewings. Whereas a traditional agent will show prospective buyers round, you are in charge of selling your own property. Most sellers are not trained salespeople and accordingly you may not get the best out a viewing by carrying it out yourself. On the flip side, buyers may actually feel more comfortable in viewing without the pressure of an estate agent in tow.
Many of the online agents offer advice as to how much you should be looking to sell for and whether or not an offer is acceptable (some for additional fees), but the decision to accept any offer (as with the traditional agent) lies with you. Other online agents do not offer this service so you will need to be confident in your own negotiating skills to obtain the best price for your property.
Another common issue is that of sales progression. The average homeowner or buyer has very little idea of the intricacies of the conveyancing process and is therefore fully reliant on their lawyer to guide them through the process. The disadvantage to this is that your lawyer cannot communicate with the other party directly, only through their lawyer. This can lead to delays if negotiations have to take place with lawyers involved as the chain of communication is longer. It can often cause real issues where there is a chain involved as the party’s solicitors may not even know who the lawyers are further up or down the chain.
With the average mortgage repayment (according to research carried out by Halifax in 2018) being around £669 per month, even a few weeks’ delay down to communication issues could lead to you to regret the decision not to go to the High Street Agent. Our advice is to liaise closely with your lawyer, get as much detail of the parties involved in any chain as you can and pass these on to your lawyer who will them have a better idea of what is going on. It also needs an element of proactivity in chasing the buyer or seller if you feel that there are delays.
Many traditional agents offer a sales progression service which usually alleviates some of the stresses involved in sales progression as the progressor or agent has more experience than the average buyer or seller.
So in short, the answer to the question posed is that it is not just a time versus money equation. There are other factors to consider in which type of agency to choose. Our advice is to consider, not only the time and money factors but also your own personality. Do you have the steely determination to obtain the best price and do you have the ability to progress a sale on your own?
For further information about conveyancing, do contact one of Alexander JLO’s expert property team who will be more than happy to assist you.