Hybrid estate agents still have only 5% of the property sales market but have helped force down the average commission charged by traditional ones by 34% over the past seven years to 1.18%.
Hybrids’ arrival in the market has also prompted a rise in the number of traditional agents offering fixed fees, which now represent 19% of the total market.
The figures are published today by property advice firm The Advisory, which also says UK estate agents charge some of the lowest sales fees in the developed world particularly in the prime market, although it says it is ‘deeply suspicious’ of agents who charge less than 1%.
It blames the drop in fees both on competition from hybrid and online agents but also the financial crisis and the consequent lowering of consumer confidence and spending power.
Traditional estate agents
In a poll conducted by the consultancy, half of all respondents said they had paid more than 1.18% in estate agent commission in the past and that 95% had used a traditional high street agency. Of those paying more than the average ‘most’ paid 1.5% while 11% paid between 1.5% and 2%.
“It’s sad to see so many agents dropping their fees in response to the perceived online threat,” says Gavin Brazg, founder of The Advisory.
“Market share for hybrid agents is actually very low given the amount of money they’ve spent on marketing. Most sellers do not want ‘cheap’. They want the extensive local expertise and high professionalism of a bricks and mortar high street agent.”