Online lettings agency being sold in ‘distressed sale’

Another one bites the dust. Sad to see any company fail, but another example of a low-cost service being unsustainable in the long-term.

You have to wonder where all that money they raised went - and what those investors who ploughed the money in now think about that move?

"A new concept designed to shake up the way renting works for good" Whenever you read nonsense like this on someone's website, you know they're full of it. Why in the hell did people give them over £7m????? I presume there were big salaries for the founders each month for 3-4 years whilst income was minimal. Not sure if I feel sorry for the investors or just that "a fool and his money are easily parted".
The one true thing they said is that things can be done "efficiently, honestly and with a smile on our face", but generally that comes from having a good business infrastructure, working ethics and plain hard work, not just through "new ideas and brilliant technology".

Yet another validation that disrupting lettings in the UK in nigh-on impossible- at least from a commercial standpoint. Howsy's latest accounts filed in December show cumulative losses of nearly £11m- nearly £4m of that in the previous 12 months. The myth perpetuated by disruptors, that operating at a transactional loss will somehow swing to profit given volume, almost never bears fruit. With virtually every established online letting agent (urban, upad & HTC) bundled up within Howsy (apart from PB) any player or investor coming in to the online letting agent sector must have something special. Mashroom & Propertyloop are trying the free model (earning from ancillary services)- but if fees don't work (with additional revenue) then you have to wonder how long they can survive. The only viable way I can see is for digital agent to charge marketrate fees and differentiate on tech and tech alone- much like Monzo, Starling etc have done with banking.

Why do none of these disruptors not think why agents operate a fee structure? It's because we agents know what it costs to run our businesses and make a profit, proven over many years. Hopefully investors will soon learn that anyone offering to disrupt the market is the place not to invest!

I really wish more people would follow this stuff to see how these serial 'entrepreneurs' make a living. Hype, hype, more hype, and other people's money.

I'm feel sad that "low-cost" service is considered some how better than a fair price for a good service.

If they had 8,000 units under management, that is up to 8,000 Landlord choosing cheap over good. Landlord need to be educated it seems - There is a reason for the saying "pay peanuts, get monkeys" - Surely if you value your property and want to have an agent look after it, you'd want Service first and best value price - not a service that sells on being "low-cost" first!.

If the agent doesn't value their time and charge accordingly, then how can you be sure that they value your property. I expect many LL have got burnt over the PB deposit fiasco - perfect example of how "saving money and doing it cheap" has actually cost the LL. They would have been better paying a decent agent. Perhaps now they do?

These disruptors don't disrupt the market - they are aiming to destroy it.

As for "free models" - just what happens when all referral fees get banned? How do free models work then? I don't think that I'd trust an agent who will manage for free (nothing is ever really free!) - but insist on me & tenants taking up all their referrals so that they get an income. Referrals wont be based on achieving the best for the client - referrals will be based on how much the agent earns out of it!
I'd rather pay for a professional to manage the property professionally because then I know that I am getting the best service.