Emoov’s collapse – what can we learn?

Before Christmas it was announced that Emoov – one of the leading online estate agents in the UK – has gone into administration. Difficult news for all involved with Emoov, and a shock to the wider property industry.

The cause of Emoov’s collapse was said to be attributed to investors unexpectedly pulling out, possibly due to difficult market conditions, or doubts about their capacity to compete with Purplebricks. 

 For many, news of the collapse came as a surprise. In May, Emoov’s value soared as they entered into a £100m merger with Tepilo and Urban.co.uk in an attempt to become the second largest player in the online estate agent market after Purplebricks.

How does a difficult market affect online agents?

On the face of it, using a fixed fee online agent in a difficult market can appear as more financially beneficial to many sellers than the high-commission estate agents. For in this difficult Brexit market, with many properties experiencing several price reductions before they sell, there’s a crucial need to protect as much equity as possible.

But is this always the best approach?

The problem is that in a market like this, there’s no guarantee of selling at all – and only the very best, at the most reasonable prices, are likely to sell quickly. Buyers are generally fussier than they would be in a good market, and they’re more hesitant to commit to putting in offers. Because of this, it’s essential to have an agent at hand to offer guidance, good advice and use their relationships with buyers to achieve a sale for your home. The issue with typical online agents is that this function doesn’t exist. If there are people to show properties at all, they have no relationships with buyers, and so will find it very hard to do what is needed right now – ‘sell’. Despite the appealing prices of online agents, in tough markets, confidence is selling is a greater pull, meaning that traditional estate agents often hold more sway.

How does Invisible Homes compare?

Invisible Homes is a great option for sellers in a difficult market. Sellers benefit from having a dedicated broker at hand who provides all the essential agent functions that are crucial in this market. But unlike traditional estate agents, our less expensive model enables sellers to protect more of their equity through significant savings in fees.

Furthermore, selling off-market is generally a more effective model. When price reductions are frequent and the average time on market increases, buyers can easily see which properties are struggling to sell. Being able to hide this information from them in order to protect value makes sense, and actually means that buyers choose on merit, rather than getting confidence or from perceived market success or failure.

Looking to sell your home in Fulham? Get in touch to find out more about selling off-market with Invisible Homes.