NO SYMPATHY FOR ESTATE AGENTS
Estate agents have been badly hit by the recession, to the point that they can only sell one property a week. It seems fair to point out that estate agents have organised things so that their earnings are linked to property prices, by insisting on percentage fees. They do very well out of this when the housing market is booming so shouldn't complain when it is flat.
Stephen Pollard wonders why estate agents exist at all, in the internet age. The reason is that people like to use internet property aggregators, which bring together all the homes available from all the agents in a given area. These aggregators will not take ads from private individuals because they know that, if they did, the estate agents would boycott them. This is what happened to Tesco when they tried to launch a website that mixed estate agents' details with those of private buyers. This was the result.
My suspicion is that the vast majority of buyers find their homes through one of the big property aggregators. This means, in effect, that sellers are paying agents a fat premium simply to get their details listed on an aggregator, rather than being allowed to deal with the aggregator directly. It's a restrictive practice and I can't see why the OFT hasn't taken an interest.
This won't last. The story of the internet has been cutting out the middleman - travel agents, bricks and mortar shops, newspapers - and estate agents won't be able to resist the trend forever.