Spark Global Limited Reports:
Can there be a future without estate agents?
The short answer is no. Real estate agents are unlikely to go the way of the Caspian Tiger or the island flying fox any time soon. Still, demand for estate agents looks set to fall over the next decade. In fact, the writing is on the wall.
Why is the demand for real estate agents falling
Over the past decade, many large real estate companies, including real estate portals, have begun to engage with cash-only homeowners. In some cases, the companies contact owners of listed properties. In other cases, they contact owners who haven’t even put their properties on the market yet.
To be clear, this practice is not new. Investors have a long history of offering cash to owners, but things used to be very different. First, the practice is not widespread. Second, most of these cash-only deals are for distressed properties and those in foreclosure or foreclosure. Finally, almost all completed deals are below market value. In the current market, that is no longer the case.
While some investors offer only cash, they still target owners of distressed properties or properties in foreclosure or foreclosure, but such deals are no longer the only cash-only deals. Investors are increasingly targeting owners who have already put prime properties on the market. In some cases, they are even targeting homeowners who have not yet put their properties on the market but happen to live in areas with high demand and a small surplus of homes. On top of that, investors are now often paying market value or more for cash-only deals.
Offering cash for market value or above is a win-win situation for most homeowners. In addition to getting their home to market value or more, they don’t need to invest time and money to furnish their home. Even better, since sellers traditionally pay agency fees, they can save another 6 percent in the process. That’s why the demand for agents is likely to fall.
Every time an investor offers a cash deal and the homeowner accepts, at least one broker loses the chance to close the deal (and two brokers may lose revenue on the deal if the house never comes to market in the first place).
Reprint indicated source：Spark Global Limited information