Is Henry Pryor Right About Agents' Commission?

Henry Pryor has a habit of getting things right about property, forseeing the industry's reliance on new technology and anticipating the market drop two years ago. But is he right about estate agents' commission?

In his latest commentary he predicts a tough year in 2010 and believes agents will fight for instructions by reducing, or at least not increasing, commission. He says that is "good news for consumers who still pay around 1.5% despite house prices tripling during the last decade". Factually that's spot on, of course, but is it good value?

Some agents I know admit their jobs are more straightforward and less labour-intensive now than in the year 2000. This is thanks to emailing details instead of posting hard copies, texting replacing some phone calls, and the internet being a low-labour showcase for properties.

As property values have risen over 10 years, notwithstanding the recent downturn, so agents' commissions have tripled in pounds and pence, too - it's only the percentage commission that has stayed much the same.

Freelance journalist rates are scarcely higher now than in 2000 (they spiked in 2007 but were then cut in the recession). Most other jobs' pay rates have risen a bit, but not tripled.

So are agents really good value? Will the public think so in a new era of Google selling homes?

Happy New Decade!

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