Estate agents are in the impossibly tough business of helping dreams come true: which means finding a customer’s happy home (some up the ante and call it their forever home) as well as progressing it from instruction to the glorious moment of exchange, all without a hitch and on time. To make it even tougher, most agents have to do all of it without proper visibility of what’s happening in the dreaded chain: the battlefield where dreams go to die.
A dramatic statement, perhaps. But the unfortunate reality is that a lack of structured sales progression, for whichever of the very many reasons, is costing customers and estate agents dearly.
Our recent research in collaboration with TwentyEA examined data from the UK's top 500 estate agents. We see that agents grappling with slow sales progression are turning over their stock just 2.3 times a year, compared to a market average of three. The most efficient agents, on the other hand, are achieving an impressive 4.5 stock turnover annually.
Given that the average sale price of properties handled by the top 500 agents is £451,000 – and assuming a 1% commission – this results in lost commissions of £938,697 per agent brand or £97,274 per agency branch, per annum. It may seem like an overestimation, but the reality is that it only translates to 21 exchanges lost per branch, per year – which makes the potential financial loss a much more relatable experience that brings the problem closer to home for many.
While some might point to external factors like local authority turnaround times or the complexities of leasehold properties as the reason for low turnover, our research suggests that these aren't the primary culprits. The core of the solution lies in providing transparency and real-time visibility throughout the entire chain that would allow agents to proactively save deals. Unfortunately, as it stands now, many find out too late when a part of the chain has collapsed. But it shouldn’t have to be that way.
Of course, chains do not collapse because of a lack of chain insight. Gazumping, gazundering, minds changed, mortgages delayed and a plethora of other reasons all have an impact. But full visibility of every property in the chain, and therefore being able to advise a seller on the best buyer with the healthiest chain, certainly reduces issues later on. The primary benefit of full visibility however, is that it allows for proactive intervention.
This is where technology can be a game-changer. Agents need access to comprehensive chain data and timely progress updates to effectively manage their sales pipelines. The good news is that the software providing full visibility of the chain and the progression of all the properties in it, isn’t a data eutopia. It already exists.
At ViewMyChain, we've developed a solution that provides real-time visibility of every property in the chain, as well as its related status - allowing agents to identify and address potential bottlenecks before they escalate into costly delays. With insight as and when it happens, agents can do what they do best: find a new buyer and save the sale.
Despite the solution for the lack of data visibility in the chain being available right here, right now, we’re still seeing conversations about the problem requiring a solution. Which leads me to believe that the most significant barrier to widespread adoption isn't chain data availability – but an overly cautious approach to software adoption.
The cost of inaction, however, far outweighs the investment required to implement these tools. Some agencies are natural early adopters of any technology that will give them a competitive edge. Some are not. But eventually the numbers do speak for itself, making the case for full chain visibility utterly compelling.
*This article originally appeared on Estate Agent Today on 02 October 2024.