EYE NEWSFLASH! HouseSimple announces it is ditching pay upfront model to become no sale, no fee only

| Rosalind Renshaw

From today, online estate agent HouseSimple.com will become a no sale, no fee only agency. It has now made the change on its website, which started off today by displaying fixed fees from £695, and no sale, no fee £1,495.

It says it has taken the decision to simplify its proposition to customers, and move away from the pay upfront model favoured by other online estate agents.

Sellers will now pay a fixed fee of £995 (including VAT), with no conveyancing tie-ins, on completion of a sale.

This fee compares favourably with the 1% to 2% commission typically charged by high street agents on sale of a property, which can leave homeowners facing bills running into the thousands of pounds, said HouseSimple in this morning’s announcement.

HouseSimple has been offering customers a no sale, no fee payment option, alongside paying a fee upfront, since January 2016.

The statement said that vendors will continue to receive a complete estate agency service through HouseSimple. The  service includes a visit from a Local Property Expert, professional photography, floorplans and valuation guidance. HouseSimple will also still manage the negotiations and sales progression through to completion.

HouseSimple CEO Sam Mitchell said: “At Housesimple, every single person in our organisation has a laser beam focus on selling properties. We also want to provide real clarity of proposition for our customers and believe the best way to do this is to offer one simple proposition.

“This ensures we are completely aligned with our vendors’ objectives.

“We also want to provide exceptional value to our customers, which is why we’ll be offering this service for just £995. It’s time for the online agents to show they are great at selling properties and we strongly feel that the pay upfront model doesn’t align businesses with their customers’ goals.

“We are excited about this change to the service we offer, as well as committed to supporting the customer all the way through their selling journey, beyond just listing their property, all the way through sales progression to a successful completion.”

Mitchell, formerly head of lettings at Rightmove, took up his current role in January this year – and has now made his mark.

Other online agents do offer no sale, no fee options with a notable exception being Purplebricks.

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52 Comments

  1. JustPlainSavage04
    April 17, 2018 at 11:55

    LOLLLLLLLLL

    Couldn’t make this up. 

    Report
  2. Philosopher2467
    April 17, 2018 at 12:05

    what an utter and complete waste of time! Upfront doesn’t deliver enough revenue and once the investors see the model for what it is they will evaporate faster than their cash has to date. An LPE, or whatever they are now, cannot deliver the service a ful service agent can. The PB bubble comes closer to bursting as has the tepilo, housesimple and others are about to and have already.

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  3. smile please
    April 17, 2018 at 12:06

    Tell you what a lot of these ‘savvy’ investors could have saved a lot of time and money if they just read Eye 😉

    Next thing you know they will get revolutionary high street offices LOL

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  4. Russell121
    April 17, 2018 at 12:07

    I can’t wait for the new TV advert !

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  5. AgentV
    April 17, 2018 at 12:09

    OK everyone, who is ready to roll their sleeves up, once and for all?

    How much of this £995 fee is being subsidised by investors money, just so they can try and destroy small independent businesses throughout the country…. to grab market share and line their own pockets?

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    1. AgentV
      April 17, 2018 at 13:41

      Guess the thumbs down are from HS people reading about their company but not willing to debate the points raised……well carry on believing you have a lucrative future being paid ?£250 a property to provide a service that can take up to 20 to 30 man hours plus follow through service to do properly…. to get the very best results for the owner.

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      1. Property Pundit
        April 17, 2018 at 15:21

        As someone wrote on a separate thread today, it’s now the disruptors disrupting each other!What a wonderful spectacle. High Street agents – sit back and enjoy the entertainment. 

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  6. AgentV
    April 17, 2018 at 12:14

    Other online agents do offer no sale, no fee options with a notable exception being Purplebricks.

    But on the threads yesterday a post was made by presumably an LPE or at least a fan, that they will be offering this within the next two months…..starting at £2,500.

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  7. JustPlainSavage04
    April 17, 2018 at 12:14

    Can I just add, how is the LPE going to get paid? Upfront or on completion? If on completion, I can see quite a lot of LPE’s leaving due being self employed.

    £995? Bearing in mind these ‘online’ estate agents still have headquarters to pay for, call centre staff, directors, LPE’s, high marketing costs, I could go on…

    I know there is additional revenue but £995 is way too little.

    Oh my

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  8. Room101
    April 17, 2018 at 12:20

    Anyone able to look at their financials and listing / sale activity?

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  9. gardenflat
    April 17, 2018 at 12:21

    £995 simply will not work. They are going after volume I guess but they’ll be busy fools. Beginning of the end for this one, watch this space for the next victim.

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    1. joproperty46
      April 17, 2018 at 12:46

      Fantastic Idea to take over the UK???? Have you thought about why they have gone £995, thought about what strategy they have or just assumed they have done this negatively and set their self up to fail. The high street need to think about what if they are successful and how to act back not just assuming that they will fail and disappear.

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      1. gardenflat
        April 17, 2018 at 12:51

        IMO It doesn’t take a rocket scientist to work out the expenses against a net value of £829.17p. Just look @ PB. 

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      2. JustPlainSavage04
        April 17, 2018 at 12:57

        Jo, I am assuming you have a connection with Housesimple?

        The high street have proven they are successful doing what they are doing, it is in actual fact Housesimple need to think about their future given they’ve just changed their fee structure in order to rectify one that wasn’t successful.

        I am sure thoughts and plans have gone into the new structure, as I am sure thoughts and plans went into the old structure.

        You need to realise, without investors money, NO online agents would still be here today given their well structured and thought out plans that weren’t set to fail. Lol.

        JPS

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        1. joproperty46
          April 17, 2018 at 14:20

          So everyone who entertains the possibility of their model working eventually, must be an online agent their self. Again that would be displaying a closed mind!

          I’m not saying they have won yet, I’m saying if they are on to a winning business plan the high street needs to adapt to stay the vendors agent of choice when deciding to sell. If not it does not matter if housesimple work out as they would of sold 1000’s of properties in the meantime and take the revenue away from the high street agents.

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          1. dompritch134
            April 17, 2018 at 14:52

             Welcome to the PIE comments section jo, expect plenty of abuse when you are not toeing the line.

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            1. Property Pundit
              April 17, 2018 at 15:24

              Let me edit your entry further Dom: ‘expect plenty of abuse when you are being a complete a$$e’. 

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          2. JustPlainSavage04
            April 17, 2018 at 15:06

            Jo,

            I think you have been brainwashed by your company, which most likely is Housesimple.

            The reason why any online agent has worked or stayed in business for so long is because of investors money. Not because you have saved people money or saved 1000’s from commission!!

            Yes I agree, online agents have saved some customers monies, there’s no doubt. But offering cheap fees does not work as a business model in the game of buying and selling houses.

            This headline today has confirmed that, which a lot of high street agents have been saying for a long time. I am not even in the Estate Agency game, and it was fairly easy to see!

            I wish HouseSimple lots of luck, because that is what they need right now.

            JPS

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  10. davehedgehog
    April 17, 2018 at 12:23

    Good point JPS04,

    Haven’t really came across Housesimple yet but if they are getting paid on completion – average sale 6-8 weeks before they get paid but if their LPE’s and conveyancing team is anything like PB’s – probably 12-16 weeks +

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    1. JustPlainSavage04
      April 17, 2018 at 12:28

      I guess it would work for the LPE if they were on a basic and commission on top, but this is going to be an extra cost for HouseSimple. 
      They would need to provide underpins or a guaranteed income for a certain amount of months, maybe 3-4 months to keep the LPE;s happy whilst building up their pipeline. 
      Interesting to find out how it would work, as HouseSimple wouldn’t be able to pay on instruction surely?

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      1. AgentV
        April 17, 2018 at 12:43

        Interesting to find out how it would work, as HouseSimple wouldn’t be able to pay on instruction surely?
        Who knows what investors will allow to be done with their money, as long they are promised the universe!

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  11. PaulC
    April 17, 2018 at 12:42

    Hmm, 6 Sales in our Territory since Jan 1st

    (Out Territory is Cardiff and Newport) So a big area

    New model £800x 6 = £4800 Net Income

    Minus average cost per customer acquisition £400×6

    Takes you down to £2400 Net Income

    Then lets say £100 per house to Photograph etc

    Leave you with £1800 (Assuming they all complete)

    To pay for Rightmove/Zoopla/You Head office/Your Valuer

     

    This is clearly the future!!!! I am going to replicate this

     

    Oh wait!

    The end is near!

     

    Now all of that said the problem is it is educating the customer that £1000 is what they should pay and at least in our area there are plenty of agents willing to do such a price.

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    1. AgentV
      April 17, 2018 at 12:47

      Hi Paul…good to see you back. What are property volumes like in your area at the moment? Round by us, a property for sale is like finding the one ring to rule them all.

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      1. PaulC
        April 17, 2018 at 14:46

        200 Sales Agreed in the first 100 Days of 2018

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        1. AgentV
          April 17, 2018 at 15:51

          That’s pretty good going, to say the least.

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          1. PeeBee
            April 17, 2018 at 15:55

            Really, AV – you think so?

            It’s only 15.7% of their entire Listings.

            My experience is that you usually turn over no less than 2/3 of your register per annum.  Much more, in many cases.

            They ain’t gonna hit 60% at this rate.

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            1. AgentQ73
              April 17, 2018 at 16:17

              Paul was referrng to his figures rather the housesimples

               

               

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              1. PeeBee
                April 17, 2018 at 17:13

                Erm… OOPS!  Thanks for pointing that out, AQ73!

                Apologies, PaulC – my bad!!

                Let me have another go at my response to AgentV:

                ‘Too chuffin’ right, AV –

                62.7% of his register SSTC in 3 months is PHENOMENAL!’

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                1. PaulC
                  April 17, 2018 at 18:20

                  PHENOMENAL is the way we roll!

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  12. apostropheV96
    April 17, 2018 at 12:56

    Really?! For fluffs sake, have you read this drivel!

    “The statement said that vendors will continue to receive a complete estate agency service through HouseSimple. The service includes a visit from a Local Property Expert, professional photography, floorplans and valuation guidance. HouseSimple will also still manage the negotiations and sales progression through to completion.”

    By a complete estate agency service we mean you will have to carry out a fundamental aspect of a professional estate agents job and do your own viewings Mr & Mrs Vendor.  You will become emotionally entangled and will have to front your potential buyer in a time that suits him and any stupid offer he may want to make because he would rather pressure you face-to-face than offer through HouseStupid!

    And do we suppose carBone whorehouse will be subsidising the LPE’s pay packet until completion? Hmmm. . . 

    Hey everyone! There’s a huge hole over there – let’s pour loads of money in it!

    Bring it on!

     

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  13. charlie.wright
    April 17, 2018 at 13:43

    Good news. It confirms up front fixed fee offerings are STILL ineffective and not a good choice for most people selling homes. Selling a home isn’t like selling a car. Paying for an ad on the biggest websites and expecting the rest to sort itself out is simply naive. This story is another piece of good news for conventional full service agents, reinforcing the fact that you can’t commoditise personal service. Offering choice to the consumer is not a justification of any business model. No sale no fee from a local professional with their name above the door (and therefore a personal reputation on the line) will almost always be the best bet.

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    1. Property Pundit
      April 17, 2018 at 15:26

      Thumbs down to this! There should be names against likes/dislikes as they do on facebook but we can guess the identities, can’t we? 

      Report
      1. PeeBee
        April 17, 2018 at 17:44

        In fairness, PP, I don’t believe I’ve never ‘liked a single syllable that Mr Wright has posted on EYE (or EAT when I used to read the back of the bog door down there…) and this latest effort ain’t going to turn me into a #fanboy anytime today.

        But I won’t ‘Dislike’ it either.  I must be feeling generous.

        Let’s just say he’s got a lot of bridge fire damage repair work to do to make me believe it ain’t a sucking-up exercise.

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  14. PeeBee
    April 17, 2018 at 14:22

    Okay – here’s an example of what this shower add to the Estate Agency industry.

    In their “Guide to UK house sale prices”, I picked an area I know well – Ponteland, in Northumberland.

    It states

    “The most expensive recorded transaction in Ponteland was £5,330,000 on 16 April 2014.”

    It probably was… but you’ll never find that transaction quoted on Rightmove, or Zoopla.

    Because the property in question was a PRIMARY HEALTHCARE CENTRE.

    Give ten thousand monkeys ten thousand typewriters…

    … and eventually they’ll write the ******** for a website.

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    1. PeeBee
      April 17, 2018 at 14:31

      “The most expensive recorded transaction in Newcastle upon Tyne was £74,937,156 on 8 January 2016.”

      HouseSimple…

      …YOU OWE ME A CHUFFING KEYBOARD!!

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      1. AgentV
        April 17, 2018 at 15:54

        Was that a bridge or something?

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        1. PeeBee
          April 17, 2018 at 17:17

          Nah – scrap ain’t paying out much these days, AV. 

          You only have to look at The Toon’s reject players – we usually sell them for sixpence in the pound compared to what we paid for them!

          It was most probably the whole of NE4 & NE15… and a canny chunk of NE5.

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  15. cyberduck46
    April 17, 2018 at 14:38

    Tied in for 6 months by the looks of it.

     

    https://www.housesimple.com/sell/trial

     

    At the bottom of the page, click on *Fee saving info

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    1. Eastsidestory90
      April 17, 2018 at 14:44

      Mr Cyberduck,

       

      As an avid fan of PB and supposedly the “online” model…

      Can you explain why PB and most of the other supposed “onliners” require an upfront fee as opposed to no sale no fee?

       

      Why Exactly?

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    2. dompritch134
      April 17, 2018 at 14:57

      I’m getting a 404 error on that page now @cyberduck.

      Report
      1. Property Pundit
        April 17, 2018 at 15:27

        Works for me.

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        1. dompritch134
          April 17, 2018 at 15:55

          Trying clicking the Fee Saving Info page as @cyberduck said, i tried putting the link but the post was deleted by the forum.

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    3. Shaun77
      April 17, 2018 at 16:12

      They will need a long tie in period as now that V’s haven’t “paid anyway”, they will be switching agents in droves once they’ve seen no activity and had no contact.

      The “pay anyway” agents manage to hold on to their V’s because they’ve already paid and cannot stand the thought of seeing a grand go down the drain, even if it does mean sticking with the agent for months on end as their house price slowly erodes. It never ceases to amaze me how many people will spend a tenner to save a fiver.

      The other significant factor is the “pay anyway” model naturally attracts V’s who are absolutely committed to moving and as such, see paying upfront as less of a risk. With the NSNF model, they will pick up all the usual vendors, including a big chunk of the toe in the water brigade, meaning their conversion rate will plummet along with their income.

      I hope they haven’t based their business model on their current conversion as they will have a big shock coming…

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    4. dompritch134
      April 17, 2018 at 16:32

      Apparently chris wood the bastion of all morals, is speaking at an investor show on the request of Tom winnifrith, yes him. It’s quite hilarious really.

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      1. Property Pundit
        April 17, 2018 at 19:29

        So you’ll be there then Dom? Will you introduce yourself to Chris?

        Your posts get more tragic.

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        1. dompritch134
          April 17, 2018 at 20:02

          Do a little research on Tom Winnifrith then come back to me.

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          1. Room101
            April 18, 2018 at 15:36

            Tell us about Tom Winnifrith, dompritch134.  Tell us, tell us!

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    5. Retiredandrelaxed
      April 17, 2018 at 17:24

      The “*Fee saving info” link at the foot of the page doesn’t go anywhere.

      The “Selling Terms” link, also at the foot of the page, takes you to their Ts & Cs – these suggest that they require 13 weeks on a Sole Agency and that the seller is free to appoint other agents in addition to House Simple for the remaining 13 weeks.

      However, I can’t see that they define the term “Sole Agency”, in accordance with the 1979 EA Act, despite their claim under clause 16 Compliance that they comply with the Act.

      I suppose you could argue that Sole Agency is described in Clause 8 Fees, but I question whether that would fulfil the requirements of the Act.

      Happy to be corrected if I have missed the required definition!

       

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  16. AgencyInsider
    April 17, 2018 at 14:56

    Ditching the upfront payment scheme in favour of payment on completion will introduce all these cut price merchants to the joys of the inevitable ‘Fall Through’ rate. And that is something they haven’t had to deal with before. What’s that little ditty? ‘There may be trouble ahead…’

    Welcome to our world people.

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  17. Property Pundit
    April 17, 2018 at 15:16

    Do we need any more proof the upfront (or deferred 10 month) payment scheme is as dead as the parrot in the Monty Python sketch?

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    1. AgentV
      April 17, 2018 at 15:56

      Or is it just resting, after a very long drivel of propaganda? 😉

      Report
  18. Property Poke In The Eye
    April 17, 2018 at 21:00

    Lol…. loving it…  The disruptors and disrupting each other.

    How do they pay the LPE’s now, if they have a NO Sale No Fee model??

    So the next part to this would be who can do it for the cheapest fee on a No Sale No Fee Basis.

    Purple Tricks, No Movement, Not Simple and Smelly Pillow are glorified For Sale By Owner sites.

    The price for this service lies around the £75-£125 Mark and that’s where these sites need to be.

    SO SORRY TO SAY.  ALL THOSE INVESTORS WILL NOT BE SEEING A RETURN.  ITS A SCAM!!

     

    Report
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