Starting an Online Estate Agency

Starting an Online Estate Agency

Author
Discussion

LDN

Original Poster:

8,905 posts

202 months

Saturday 20th January 2018
quotequote all
I know that Purple Bricks, Tepilo et al have gotten a foot hold in this area... but having used them a couple of times; I feel there are things that could be improved.

What does it take to set one of these up? I have web guys, I have a background in Property; so other than very deep pockets; how would one set an online agency up? What do people look for?

1. Cheap
2. To get Property onto Righmove and Zoopla
3. Pics / floorplans as an extra
4. Solicitor arranged as an extra

The list goes on... anyone ever thought of doing this? Or ever used one and found it lacking any way?

Altrezia

8,517 posts

210 months

Saturday 20th January 2018
quotequote all
My friend does this but for rentals. Didn't seem too hard to set up and seems to be going well for him.

Good luck smile

LDN

Original Poster:

8,905 posts

202 months

Saturday 20th January 2018
quotequote all
I think traditional agents will always have a place / purpose ... but the online agents are seeming to gradually get more and more of the market share of stuff coming online.

In France, many sellers just list their property privately on their version of Gumtree... they don’t even bother with an agent in any way at all. It’s interesting to see. I think there’s a market for people who want to do their own floorplans, pics and write up; and have that put online; righmove and zoopla, etc - without the local experts and faff involved. I can think of a model that would likely work; based on my own experiences, and my peers - but it’s a case of pushing it once it’s set up; that would (as always) be the hard part; the make or break.

Nickyboy

6,700 posts

233 months

Saturday 20th January 2018
quotequote all
The issue is for the people selling the property is that they wait for potential buyers if they use an online agent, if they sell through an agent they actively chase those who are looking for property and gives them new listings etc. When i bought my place i had the agent on the phone every time something that suited my requirements came up for sale.

anonymous-user

53 months

Saturday 20th January 2018
quotequote all
Marketing which, bluntly, = £

I liked the ewemove model / story

KevinCamaroSS

11,554 posts

279 months

Saturday 20th January 2018
quotequote all
I heard a rumour late last year that PurpleBricks has yet to turn a profit.

fridaypassion

8,504 posts

227 months

Saturday 20th January 2018
quotequote all
LDN said:
What does it take to set one of these up?
5 million quid in VC funding.

Grandad Gaz

5,090 posts

245 months

Sunday 21st January 2018
quotequote all
KevinCamaroSS said:
I heard a rumour late last year that PurpleBricks has yet to turn a profit.
I wouldn't be at all surprised. They spend a huge amount of money on advertising.

EddieSteadyGo

11,720 posts

202 months

Sunday 21st January 2018
quotequote all
Grandad Gaz said:
KevinCamaroSS said:
I heard a rumour late last year that PurpleBricks has yet to turn a profit.
I wouldn't be at all surprised. They spend a huge amount of money on advertising.
Their figures are public information and so are available for anyone to see.

For last year their reported turnover was circa £47m with costs of sale at £21m. Gross profit was just under £26m. Deducting salaries of £10m leaves £16m from which to pay their other costs.

Whilst they are not currently making a profit, they are very much in a rapid growth phase which requires significant investment.

Once this levels out, based on the top line figures I mentioned above, they will be making a very healthy annual profit.

EddieSteadyGo

11,720 posts

202 months

Sunday 21st January 2018
quotequote all
fridaypassion said:
LDN said:
What does it take to set one of these up?
5 million quid in VC funding.
Yep. And possibly a bit more than that in order to maintain cashflow as you burn through millions in advertising. There is no doubt in my mind though that in 10 years time when the dust has settled there will be some very successful "online" estate agents.

AB

16,969 posts

194 months

Sunday 21st January 2018
quotequote all
https://www.love2move.co.uk/

Seems a blend of both.

Adam B

27,142 posts

253 months

Sunday 21st January 2018
quotequote all
Nickyboy said:
The issue is for the people selling the property is that they wait for potential buyers if they use an online agent, if they sell through an agent they actively chase those who are looking for property and gives them new listings etc. When i bought my place i had the agent on the phone every time something that suited my requirements came up for sale.
why do you need that? saved searches on the usual websites serves the same purpose (maybe with a day or two delay but rarely an issue IME given I only viewed at weekends)

Condi

17,088 posts

170 months

Sunday 21st January 2018
quotequote all
Adam B said:
Nickyboy said:
The issue is for the people selling the property is that they wait for potential buyers if they use an online agent, if they sell through an agent they actively chase those who are looking for property and gives them new listings etc. When i bought my place i had the agent on the phone every time something that suited my requirements came up for sale.
why do you need that? saved searches on the usual websites serves the same purpose (maybe with a day or two delay but rarely an issue IME given I only viewed at weekends)
Maybe he means the estate agent will already have a list of potential buyers on their books, and so may be able to sell before it ever comes to the market. I suspect a high street agent is also better at contacting people who have had a viewing to get their thoughts, and encourage them to make an offer etc.


Adam B

27,142 posts

253 months

Sunday 21st January 2018
quotequote all
Of course the latter is true

I just think the connecting of buyer with properties and seller doesn’t require an agent anymore.

And EAs only chase buyers for you when the market is flat or poor IME

WolfieBot

2,111 posts

186 months

Sunday 21st January 2018
quotequote all
Nickyboy said:
The issue is for the people selling the property is that they wait for potential buyers if they use an online agent, if they sell through an agent they actively chase those who are looking for property and gives them new listings etc. When i bought my place i had the agent on the phone every time something that suited my requirements came up for sale.
I found the complete opposite to be true. The estate agents kept pestering us with properties that in no way matched the criteria we'd given them. The ones we have bought have been found ourselves on Rightmove.

DSLiverpool

14,671 posts

201 months

Monday 22nd January 2018
quotequote all
Are you going to advertise on Rightmove etc or compete? The thought of competing even at a local level will be costly.
Maybe launch the site and slow burn it?

jammy-git

29,776 posts

211 months

Monday 22nd January 2018
quotequote all
The thing with Rightmove is that you can't afford to and you can't afford not to. Rightmove fees are usually in the thousands per month, so it's a big consideration when putting together a business plan.

Unless you can be creative with social media marketing and grow that way until you can afford to make the leap to RM/Zoopla.

Adam B

27,142 posts

253 months

Monday 22nd January 2018
quotequote all
LDN said:
What do people look for?

1. Cheap
2. To get Property onto Righmove and Zoopla
3. Pics / floorplans as an extra
4. Solicitor arranged as an extra
in answer to OPs direct question - for an online EA

1. yes that's the whole USP
2. yes
3. yes as a buyer its a must, although how much would you charge the seller?
4. not required at all, but no harm in referring and making money off the solicitor

Edited by Adam B on Monday 22 January 12:54

jammy-git

29,776 posts

211 months

Monday 22nd January 2018
quotequote all
Do people look for cheap, or value for money?

I've heard so many people complain about the fact that they had to pay their estate agent X thousand and all they did was to take a few rubbish photos and upload them to RightMove. Sometimes they don't even conduct the viewing themselves.

I think people don't mind paying a bit of money if they see that the service being provided is worth it.

superlightr

12,842 posts

262 months

Monday 22nd January 2018
quotequote all
EddieSteadyGo said:
fridaypassion said:
LDN said:
What does it take to set one of these up?
5 million quid in VC funding.
Yep. And possibly a bit more than that in order to maintain cashflow as you burn through millions in advertising. There is no doubt in my mind though that in 10 years time when the dust has settled there will be some very successful "online" estate agents.
6 million loss last accounts. loss of 12 mill before and loss of 5 mill before that.

I don't agree - its a race to the bottom with increasing costs of advertising. I don't see Pbricks ever getting ahead of the loss curve. I think their "investment" will dry up well before making a real profit. They are a listing agent - not a sales agent.


OP you would be on a hiding to nothing.

I would think you would do better with an office and set fees for selling and or set fees for listing and get yourself know in a local village. You may stand a chance of cornering the market there provided the other local EA don't match you, you work your socks off, you promote and push very hard but but again it could still be a race to the bottom and tears.


Edited by superlightr on Monday 22 January 13:03


Edited by superlightr on Monday 22 January 13:04