It’s time for our 7th Industry Insights interview and this time we are chatting with the founder of MoveSelf, Kae Travis.
Q1: Let’s start with the million-dollar question, where do you see the housing market going this year?
This is like asking me to pin the tail on the donkey, since the housing market in 2019 will largely depend on the outcome of Brexit! And if Theresa May and Jeremy Corbyn attempted to pin the tail on the Brexit donkey today, I wouldn’t expect either of them to find its’ backside!
Predicting such an outcome would be guesswork at best, potentially misleading and probably irresponsible.
I’ve seen supposed ‘experts’ in the industry predict minor rises in house prices throughout 2019, and others predict minor falls in house prices. But what are these predictions based on?
How do these people know the implications that Brexit will have on interest rates, inflation, unemployment, economic growth and consequently house prices when they don’t even know the outcome?
The very fact that the opinions of these highly qualified people differ illustrates that nobody truly knows the effect that Brexit will have on the housing market in 2019. Me included.
Q2: Fair enough, but how do you think the different Brexit scenarios could impact house prices in the short term?
The Bank of England performed stress tests on the economy should the United Kingdom (UK) leave the European Union (EU) without a deal. These stress tests were based on a worst-case scenario of house prices plummeting by a third.
Even though this was merely a stress test and not a prediction, it does indicate that a no-deal Brexit would have a detrimental effect on the housing market.
Should the UK agree on a deal to part company with the EU, we don’t know whether it will be a good deal or a bad deal and only upon this outcome would it be possible to predict the effects on the housing market.
I must admit, I’ve been sitting on this Brexit fence for so long I’m starting to get splinters in my derriere!
Q3: Online estate agents still appear to have less than 10% of the overall market, why do you think their growth has been slower than many were predicting?
There are a few reasons really.
Online agency is a shift in culture from the traditional high street model that people have become accustomed to. Many people still aren’t aware of online estate agents, don’t trust them, or don’t understand the concept.
And when the transaction involves an asset as important as somebody’s home, it’s inevitable that some homeowners are sceptical.
To gain the awareness, trust and understanding of millions of people in a relatively short period of time requires massive expenditure and perfect execution.
Some of the bigger players in online agency have spent huge sums of money – millions of pounds a year – to increase their brand awareness. And whilst the marketing aspect has generally been sound (give or take the odd brush with the Advertising Standards Authority), the execution hasn’t.
Some have gone into administration because of this, others are making hefty losses and the rest are chugging along with an average reputation; sometimes expanding too quickly can lead to operational issues, and this seems to be the case for one or two of the bigger online estate agents.
Whilst it’s positive news that these same online agents have raised public awareness of the online estate agency model, they have not necessarily painted the model in a great light.
If you consider that 90% (or thereabouts) of the market is made up of high street estate agents that generally discourage homeowners from using online estate agents, it’s hardly surprising that getting traction is difficult.
There seems to be a divide in how high street estate agents perceive online estate agents; true professionals welcome the innovation, the automation and the forward-thinking approaches that are dragging the industry into the digital age. The rest despise online agents for driving down the cost of selling homes.
We must also remember that the housing market is still rather subdued, and properties are taking longer to sell. This has implications on the whole industry, not just online estate agents.
Q4: 2018 saw the demise of some well-known online agents such as Emoov, Tepilo, and Hatched, do you think the typical online estate agency model is sustainable?
It depends on what we class as ‘typical’ and indeed what we class as an ‘online estate agent’ model.
High street estate agents are essentially online estate agents, since they have a website and can generate instructions and provide valuations online!
Conversely some online estate agents offer the exact same full-service model as a high street estate agency, but just don’t have a physical high street presence!
Then you get no-frills online listing agents, hybrid agents, pay upfront agents, pay on completion agents and many more.
Finally, there is MoveSelf: a completely bespoke mobile-ready platform that provides ad hoc estate agency services.
Some of these business models simply aren’t sustainable because they are too cheap to cover the cost of operations; doing some basic maths based on transactional volumes highlights this. And because the margins are so small and potentially don’t even cover costs, resources become stretched and service levels suffer.
Other examples have required large investment up front to raise brand awareness in expansive geographical areas, and when the investments didn’t materialise they were doomed.
Were these business models sustainable if they’d have navigated this hurdle successfully? Possibly. But with so much investment required upfront there was always going to be an element of risk involved before the business could find stability.
It’s not just the online estate agent business model that should come under scrutiny, though. Many high street estate agents have been casualties of a lacklustre housing market such as Countrywide, Reeds Rains, Your Move and many more.
When volumes are low for high street estate agents, and houses are taking longer to sell, the typical 1.5% commission on less expensive properties will struggle to cover the cost of selling a home.
Q5: And how about the property portals? Do you see any major changes forthcoming in the way they conduct business and deal with estate agents?
No, not really.
I’d like to see Rightmove reduce their fees. However even in a challenging market their fees continue to rise!
I’d also like to see OnTheMarket provide more clarity on their membership eligibility criteria. Once upon a time they didn’t allow online agents, which I thought was underhand considering we’re all here to sell houses. Now it seems that they do accept online agents….or do they? Who knows.
I was also disappointed by their ‘one other portal’ rule, which also appears to have been scrapped in recent times.
At MoveSelf we use Zoopla. They’re the second largest property portal in the UK behind Rightmove, are forward-thinking, reasonably priced (considering the competition) and provide good overall support.
Q6: Tell us a little about how MoveSelf and why you started it?
I started MoveSelf because I paid £2,000 to sell my one bedroomed flat.
I conducted 90% of the property viewings (including the viewing for the eventual buyer) because most viewers couldn’t view between 9am-5pm (they were at work) and the estate agent only worked between 9am-5pm! So most of the viewings took place during the evenings and were conducted by me.
Combined with this, the estate agent was so inefficient during the sales progression process that I often used to liaise with the conveyancing solicitor myself. And there wasn’t even a chain involved! It was a disappointing experience.
This overpriced service coupled with an industry ripe for technological innovation (considering my background in technology and automation) were the key drivers that inspired me to create MoveSelf.
Q7: You recently moved to put more emphasis on
your ‘For Sale By Owner’ (FSBO) services, could you tell us more about why that’s become your focus?
MoveSelf (‘move’ home your ‘self’) is essentially a platform that enables homeowners to sell or let property themselves whilst being assisted by ad hoc professional estate agency services. It’s perfect for private landlords and savvy homeowners, and there’s nothing else like it in the property industry.
This concept shouldn’t be confused with a basic listing service though, since we provide multiple professional estate agency services and act as a proxy between the owner’s listing creation and property portal publishing.
If you want to look at it another way, we’re an online estate agent that outsources some of the operational activities to the homeowner such as creating the listing, conducting the property viewings and negotiating any offers. This enables us to substantially drive down the costs of selling a house.
Q8: What do you believe are the biggest challenges faced by homeowners who want to sell without using an estate agent?
Firstly, if you’re not an estate agent you won’t be able to list your property on any of the major property portals. That would be the first
The next best bet would be listing on Gumtree or eBay. But those platforms aren’t specifically built for property and as such the listing formats lack detail and structure, and the exposure would be much less. And there’s no access to professional estate agency services such as photography, an EPC and floor plans should they be required.
I don’t believe that conducting property viewings or negotiating offers should present a challenge – any semi-charismatic, relatively intelligent person is capable of this. These are soft skills after all. And nobody knows a home better than the owner.
I was 10 years old when I negotiated the sale of my Amiga 1200 via The Loot. The process of negotiation didn’t faze me. I had a lowest price in mind. Anything below that was a no, and anything above that was a yes. Simple really.
The only other challenging aspect is sales progression. If the property chain is complex, or multiple issues arise during searches
Q9: And how does MoveSelf look to help people overcome those challenges?
Well firstly we’re an estate agent, and we list properties on Zoopla, PrimeLocation and many more. These platforms attract more than 30 million monthly visitors per month and will increase the exposure for each property.
Our platform is specifically built to sell and let property. It’s slick, mobile-ready, uses phone-safe contact numbers, SMS notifications and homeowners can create attractive property listings within minutes.
We also provide a range of ad hoc professional estate agency services to support our homeowners throughout the entire process.
One such service is our no-exchange-no-fee sales progression service, which can be purchased in the event of an overly complex property chain. Alternatively, if it’s a simple property sale with no chain, homeowners can save money by doing it themselves.
Q10: What should we expect next from MoveSelf?
We’ll continue to work hard with honesty and integrity and will try to convey our message in the best way that we can.
The landscape is challenging for all sorts of reasons – a B2C start-up in a competitive industry with a subdued market and a new concept is hardly a recipe for success! And when you factor in the millions of pounds already wasted on previous attempts by our competitors, it doesn’t bode well!
But we believe that our platform will ultimately improve the selling and letting experience for homeowners.
Our business model is sustainable. Our platform substantially drives down the cost of selling homes. And it provides homeowners with more choice and an exemplary experience that is unparalleled in the industry.
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