Some agents are resenting the fees they pay to ‘the big two’ and now appear to have had enough. A consortium including Knight Frank and Savills launched the new site two days ago which, interestingly, allows an agent to only use one other web portal. With fees only ever having risen, OTM could be an attractive prospect for many agents; but what about the users of the sites?
In effect, OTM will be run for estate agents, by estate agents, many of whom have actually invested in the venture in the hope that more agents will follow suit. It’s unlikely to attract them all, not least those with shareholdings in Zoopla or Rightmove.
So why are they switching?
Well one reputable London sales and lettings agent who’s decided to switch told me “Rightmove and Zoopla pretty much had us over a barrel each year with their price increases. We pay RM over £40k a year and Zoopla £20K. With OTM, our fees are about £20K too but they are fixed for 5 years, with the aim that they will reduce once they’ve reached a certain number of clients”.
2 days in, it looks as though Zoopla’s lost more agents to OTM than Rightmove but not nearly as many as investors feared; hence their 12% share price jump.
In the meantime, Zoopla’s playing hardball. Agents report ‘unusual’ visits from people claiming to be buyers, followed two days later by letters demanding the removal of the Zoopla logo from all promotional material; a risky strategy by Zoopla if true – if the mighty Rightmove were to fall, agents will be looking for a friendly 2nd option, and that’s not very friendly!
So who’s set to benefit?
For agents it’s a gamble that depends to some degree on how well they organise themselves. They’ll certainly face lower fees, and you’d like to think they’ll pass that on to their clients (!).
Some question their motives. Alex Gosling of House Simple calls these ‘high street agents’ actions “a cynical, anti-competitive and desperate reaction to a market that is changing”.
But blaming the newcomer for spoiling the party seems disingenuous as agents argue that’s it’s the actions of the big two thats forced their hand.
My agent friend in London is cautiously optimistic. “It should benefit the end user” he says. “There are no fancy frills / adverts / confusing click here and click there. It won’t show how long the property has been marketed for or if there have been any price reductions either, which actually often serves to put potential tenants and buyers off”.
ones out there, it’s a more confusing and inconvenient process than it should be.
On launch day, I noticed a distinct drop in the number of properties coming up on Zoopla compared with the day before. I was actually in a village with over 25 houses for sale but the Zoopla-app only showed me three!
Aside from being worrying for Zoopla, that’s just not helpful and many users have no idea that they’re missing out on properties like this.
Time will tell who the winners and losers will be.
Remember, the best way to ensure you don’t miss anything is to use all the sites, not just one. In the meantime, check out onthemarket.com and let me know what you think. Better still, save the hassle of finding a new home alone by getting in touch and letting me do your search for you.