Westminster estate agents made £70.3million in fees in 2014
PUBLISHED: 14:03 20 February 2015 | UPDATED: 14:03 20 February 2015
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Estate agents in London have been bolstered by the continued property price surge, with new figures revealing record takings of £1.1 billion across the capital in 2014 - prompting high street agents to defend higher profits against cheaper online rivals.
Figures released by online agent HouseSimple show the average cost to homesellers hit £9,384 last year with high street estate agents across the capital seeing a 23 per cent boost to takings.
High street agents in Westminster saw a 14 per cent hike in commission to £70.3million-the second highest profit in London after Kensington and Chelsea.
The data also show that estate agents in Camden pocketed £46.3million whilst their colleagues in Haringey billed an extra 25 per cent last year with charges totalling more than £27.2 million.
Online agents like HouseSimple claim sellers could have saved an average of £210million if just 20 per cent of them had opted to sell via a website in 2014.
However, the traditional high street agents warned that these lower cost alternatives do not always pay dividends.
Robert Lehrer, director of Robert Lehrer Properties in Highgate said: “The major difficulty with online is that with an estate agent you have got someone at end of the phone, not just a computer screen.
“With a high street estate agent you get a personal service, quality advertising, professional floor plans and someone to guide you hand in hand through the documentation process.
“Online fess are cheaper but the differential between the price you could sell your property for with an estate agent rather than a DIY online service is sizeable.”
He said: “More and more nowadays the property market is a visual market. It is true that the selling is all based online but whatever you show online has to be the best quality in order to compete.”
Asked about the windfall in estate agents’ takings for 2014 he said: “Our fees haven’t gone up, it is a just a reflection of increased activity in the property market. With average takings between 1.5 per cent and 1.75 per cent per sale, but with more sales being completed, there’s clearly going to be a benefit.”
Mr Lehrer, who opened his first branch of local estate agents in Highgate in 1987 also said that increased competition from “do-it-yourself” online sales sites could eventually force down the commission commercial chains of estate agents are able to charge.
“Commercial agents can get away with charging up to 2.5 per cent because their advertising and branding is a real advantage but with the emergence of online, they will need to remain competitive too.”