Guest blog – Peter Rollings
Guest blog written by Peter Rollings, Ex-CEO and current Board Member at Foxtons.
My hopes (and fears) for the future of Estate Agency…
The overriding factor determining the future of estate agency is the fees that agents are prepared to charge for their services. Everything else flows from that; the amount of marketing, the quality and skill of the people, the level of personal service able to be provided… everything.
When I first started out in the business (a worryingly long time ago) there was no question of not charging a proper fee, in our case 2.5%. We were proud of the quality and level of service we provided, and we were resolutely determined to obtain the best price for their property… and be well paid to do it – a win-win. It meant that the people were paid appropriately for what is a tough job with long hours and our clients were (largely) contented.
I can hear some of you reading this thinking that this wasn’t true in my time at Foxtons. Well, you’re wrong (in my humble opinion!) We sold and let many thousands of properties a year and got comparatively very few complaints. Rarely from sellers or landlords as we were very focussed on remembering who our client was and who paid our fee which then, as now, is around 2.5%. It was the same when we sold Marsh & Parsons – an average blended fee of 2%.
I’m not sure when agents started only being concerned about the level of their fees, but they did and there began a race to the bottom… which nobody wants to win.
The online only agents then widened the available choice, followed swiftly by fast buy agents, often concerned by volumes rather than the profit margin attainable from them – remember, an instruction is a liability until it is sold or let and only then becomes an asset.
My hope? That good agents will start being braver and rejecting business that is damaging to their bottom line (and brand positioning) and thereby start improving their level of service, their ability to pay their staff properly thereby reducing turnover and gain a reputation as an expert agent – not willing to be judged purely by what fee they charge but justify that they really are worth more than the discount agents.
My fear? That nobody will learn from the resistance mass market online only companies have faced in the U.K., and that estate agency will remain in the badly paid, under motivated, poorly staffed rut it’s been in for a while.
