A Call To Arms....
We know that the UK estate agency market is the most competitive in Western Europe, with the fees levied being only a fraction of those applicable in most developed countries (even when compared to the supposed paragon of the free market, the USA). We also exemplify the specialist skills involved in successfully selling a property, and help mitigate the significant risks involved to the buyer and vendor from acting without professional advice and guidance. Finally, if the rate of consumer dissatisfaction has fallen by half to 12% since the last report, then the service is clearly rapidly improving of its own accord (given the current absence of licensing and mandatory qualifications).
The market statistics also speak volumes. Too many estate agents chasing too few transactions has meant that only a small minority are making healthy profits. With over 2,000 offices closing their doors in the last two years (approx 15% of the total), this is far from the claimed distorted market where cartels and collusion is rife. Actually, it is remarkable that there has not been more 'tacit agreement' at a local level to protect fee levels (although this of course would be criminal).
The NAEA and the RICS have voiced their disappointment and concern regarding the report's findings, but this is surely once again closing the door after the horse has bolted. How can we as a group be so misunderstood?
The answer lies in our fragmentation - too many minority organisations representing particular factions of the market, each of whom can have unique, vested interests. It is perhaps inevitable that with no-one speaking for more than a minority of the industry, we are not invited to 'the top table', and our opinions are too often dismissed as no more than propaganda.
So, we need to find a body that can speak for us all, with common sense and confidence, and secure influence in exalted circles. The current bodies have fallen short (HIPs, anti-money laundering) and we can no longer trust to fate or the whims of political electioneering.
As importantly, what if anything will the public make of this? We are already the classic 'mother in law' joke, not helped by real-life documentaries that stay long in the memory. But we created this legacy, and it will need consistent and positive messages from everyone involved to change it.
Yet if you explain to a vendor just how hard an estate agent works, the long unsocial hours, the sometimes intractable problems we have to solve, the extensive advice and expertise, the personal investment made by the agent in marketing their property (average £700), all with only a 50% chance of any financial reward, they do understand our position. Maybe a more informed consumer explains the higher levels of satisfaction?
So the common theme is better communication - upwards to the regulatory authorities, sideways to the various organisations that represent us, and downwards to the consumer. Vested interest and a failure to seize the high ground is an indictment of our industry, and a particularly damning one for a business that spends the majority of its time in conversations.
What in particular are we going to do about this misrepresentation of our industry?
- The Guild is formally writing next week to the OFT, NAEA, and RICS expressing our consternation with the report's findings
- We encourage you to write directly to the OFT yourselves in a similar vein
- The Guild will also be inviting the OFT to Park Lane for a discussion and exploration of the factual basis of the report
- We will shortly send you an open letter that you can place in local newspapers and in other media explaining to the public the advantages of using a professional, independent estate agent
It is time to take visible and decisive action to defend an industry which consistently delivers an important and responsible service to society, and excellent value to the public.