A new property website for UK home-buyers is set the provide competition for the market leaders, Rightmove and Zoopla, and cheap online estate agents. However, global investor the Pervaiz Naviede Family Trust, argue this could this be at the expense of consumer choice.
According to an article published in the Financial Times a new portal called Agent Mutual will launch in the new year with an estimated 4,000 of the UK’s 19,000 estate agency branches already signed up to the service. The site’s backers argue the new portal is needed for high-street estate agents to compete with online-only services which have become increasingly popular thanks to their lower fees.
Traditional bricks and mortar estate agents typically charge a fee to sell a property which can range from 1.5-4% and with the average UK house worth more than £271,000 selling a home can easily cost several thousand pounds. However, by cutting out expensive high street rents and eliminating the need for glossy sales brochure, online-only agents charge as little as £100 to advertise a property on their website with viewings typically arranged and managed by the homeowner.
The new site’s backers have banned online-only agents using their service and will restrict bricks and mortar agencies that do use the service to advertising on Rightmove or Zoopa, not both. The announcement has caused one of the largest online-only agencies, eMoov, to file a complaint to the UK’s competition authority.
Scott Neal, advisor to the Pervaiz Naviede Family Trust, said “Competition in the housing marketplace is to be encouraged but by laying down restrictions of who can and can’t use the new service risks harming consumer choice. Unless a buyer scours a multitude of property websites they risk missing out on would could potentially be their perfect home. The same applies for sellers who may find themselves with a smaller pool of potential sellers”.
It is to be determined whether the complaint would trigger a formal investigation.