Member Article

Online lettings agents risk “new dotcom bubble” for housing

A leading property expert has hit out against online-only lettings agents – branding them “an expensive postcard in the newsagents’ window” and comparing their rise to the 1990s dotcom bubble.

easyProperty – backed by easyJet founder Sir Stelios Haji-Ioannou – recently became the latest high profile entrant to the online letting agent market, promising to deliver “a new generation of estate agent”.

Typically these agents market homes online, charging customers “only for services you want” like tenancy agreements, tenant referencing and even property descriptions and floorplans, with landlords “self-managing” their properties.

Property expert Ajay Jagota, founder and Chief Executive Officer of the North East’s most innovative sales and lettings business KIS described the system as “real emperor’s new clothes stuff”.

The property firm is famous for being the first letting agent in the UK to abolish deposits, replacing them with a one-of-a-kind landlord insurance policy offering guaranteed rent, deposit replacement, legal assistance and round the clock third party emergency home repairs.

Ajay said: “The emergence of online-only agents is like witnessing the dotcom bubble again, people trying to convince customers, investors and probably even themselves they’re doing something terribly daring and radical, when all they’ve actually done is advertise a property on the internet.

“They don’t actually offer anything new at all. It’s really emperor’s new clothes stuff – one of them even offers you a ‘to let’ board as a premium service!

“If you think that things like contracts are optional extras you can do without, what are you left with? An expensive postcard in the newsagents window while you pay to manage your own property!

“KIS have tried to challenge every preconception in property – I don’t think anyone could call the company who abolished deposits a dinosaur – but nothing here is new, and nothing here strikes me as a step forward. No-one disputes that the property industry needs to change, but this is not the change it needs.

“I actually think the next big change in property will be the emerging influence of the insurance industry, which as a partner can offer more comprehensive and effective solutions to the big issues facing our industry which in turn will offer better outcomes for landlords and tenants alike”.

KIS manage properties for landlords in every corner of the North East from branches across Tyne and Wear, and were named Letting Agent of the Year in the 2013 Landlord and Letting Awards. The firm expanded into residential sales in 2014.

This was posted in Bdaily's Members' News section by Ajay Jagota .