Commentators and PropTech start-ups have been sounding the death knell for high street estate agencies for years. In 2015, easyProperty launched its online agency by staging a funeral procession for their bricks and mortar peers through the streets of London. As far as PR stunts go, it was pretty good. Unfortunately for easyProperty, the business has failed to live up to the hype. They’re not alone.
Online agencies have clearly not disrupted the industry to the extent that some commentators were predicting a few years ago. After a flurry of activity that saw online agencies popping up all over the place, the disruption has dissipated somewhat. Even major players like Purplebricks have seen their fortunes wane.
Once touted as a real game-changer, Purplebricks seems to have stalled. In 2019, the company shut down its Australian operation citing tough market conditions. A year later, it sold its Canadian business. While the business returned to profitability in 2020, it’s been a tough time for the Solihull-headquartered company. Over the past five years, its share price has tanked 40%.
What does this all mean for high street estate agencies?
While the threat posed by online agencies may have been overstated, it hasn’t gone away. Purplebricks is still ticking along, Emoov is enjoying a renaissance, and new players like Strike are getting in on the act. In other words, as long as low-cost digital estate agents are out there winning business, high street agencies can’t afford to be complacent.
One of the best things that bricks and mortar estate agencies can do to mitigate the threat posed by digital disruption is to innovate. If streamlined digital processes are good for other businesses, then surely estate agents can benefit from tech, too. As it stands, too many sales and lettings agents rely on outdated processes that are costly and inefficient. Not only does that lead to lower levels of productivity, it also puts those businesses in the firing line of online agencies.
Selling and managing property is a serious business, and traditional estate agents have a distinct advantage over online upstarts: Experience. But knowing how to get the best price for your vendor or landlord will only get you so far. With online agents offering lower fees and ‘frictionless’ experiences, it’s time for more high street estate agencies to embrace innovation and turn to digital solutions.