Tag: Property for Sale

Agents “dread” buyers’ questions on value, asking prices and nearby new development according to a survey.

Some 50 agents and over 1,500 owners who had purchased in the past three years were questioned by interiors firm Hillarys over their dealings with estate agents.

The questions the agents apparently dreaded most were:

– How much money has the property lost in value over the last X years? – 54%;

– Are there currently any plans for the local area that could affect us as homeowners? – 42%;

– What is the lowest price the sellers are willing to go? – 33%;

– Is the seller part of a chain and how motivated are they to sell? – 21%;

– Has anyone died in the property? – 18%

The agents also revealed some of the most unusual questions they’d been asked by prospective buyers during viewings included ‘do the pets/plants come with the house?’, ‘is there any chance that the home is haunted?’ and ‘would I be allowed to paint the house exterior?’

Suddenly Brexit Day is nearly here.

It may have taken three and a half years from the Referendum but the UK will, within days, be outside of the EU. Whatever one’s views, and whether or not that is a cause for celebration, there is substantial work to be done by the end of 2020 – the transition period.

The object is to achieve clarity over this country’s future, and that applies to our industry as much as any other. It will take years, possibly decades, for a stable post-Brexit landscape to emerge as this country disentangles itself from the EU.

The mistake is to assume that on February 1 we’ll wake up and “it’s happened” – in fact, the hard work may only just have started.

– Will today’s Boris Bounce turn into this summer’s Johnson Jitters?

Only those with a vested interest in talking the market down deny that there’s been a renewed confidence in the mainstream and prime buying and selling since the General Election.

There have been more sales completed (up 6.2% in December says HMRC, despite Christmas), higher asking prices (up 2.3% with the biggest New Year leap in 18 years according to Rightmove), and more optimism (a doubling in the number of agents expecting an improved market, says RICS).

But the question is, will this last? If, by the summer, there is no sign of a successful trade deal with the EU (or maybe even the US) the debate from September onwards will be defined by the question: Is the UK heading for No Deal at the end of the 2020 transition period.

If so, will the housing market return to something like the hesitant state it had before last month’s General Election?

– Will agency-focused legislation begin to diverge from the EU?

The introduction of the Fifth EU Anti-Money Laundering Directive into the UK just a matter of days ago shows how closely harmonised some agency-related legislation is with the European Union.

But there are more such links, much more commonplace than those surrounding money laundering issues. These are long-term issues agents have to think about.

For example, the Energy Performance Certificate (introduced in the UK in 2007) was a product of the EU Directive 2002/91/EC.

Now one might guess, especially in our current climate crisis political landscape, that EPCs will remain in place in the UK – but outside of the EU, the UK is now free to change them if it wishes. Will there be pressure to do so?

In construction, the British Board of Agrément – it even uses the French term for ‘approval’ in its name – is a certification body for some standards (FENSA for doors and windows, for example), many of which are based on EU legislation. Again, the UK may continue to harmonise with EU standards but it’s likely there will be pressure from some quarters to diverge.

There could be long-term, ongoing change affecting agents as a result.

– Will City of London job losses hit the capital’s high-end housing market?

So far the financial services fall-out from Brexit has been less-than-expected, but many players have made it clear they have been waiting to see if the UK would actually go, and if so under what terms.

Bloomberg has predicted that potential staff relocations from London include 4,000 staff from J P Morgan, 150 from Barclays, 1,000 from Morgan Stanley, 1,000 from Goldman Sachs, 1,500 from UBS and 1,000 from HSBC. This adds up to a potential 8,650 jobs leaving, out of a total of 48,000 London-based posts currently accounted for by these companies.

What of the City’s sales and rentals markets if London is somehow under threat as a premier financial hub?

– Will overseas buyers continue to want to buy in the UK?

There are two aspects here. Firstly, irrespective of Brexit, there’s the anticipated three per cent SDLT surcharge proposed by the government and likely to be confirmed in the March Budget. This will apply to overseas investment buyers living outside the UK.

The second aspect is Sterling: it went into freefall after the referendum (have you seen the cost of those holiday Euros?) and within a year of the Leave vote, those buying in the UK and using other currencies were receiving what were effectively discounts of up to 21 per cent.

If Sterling returns to something like its pre-referendum level soon, will those buyers go? And if so, will domestic buyers step in to bolster the prime London housing markets so heavily reliant on overseas interest?

– Will there be a labour force to meet UK’s new homes aspirations?

Leave to one side the abject failure of successive governments to meet housing targets in the past, and even without that this area looks like one of the biggest problems for the UK post-Brexit.

That’s because the 2017 Labour Force Survey (the most recent figures available) show non-UK workers were 14.5 per cent of the UK construction workforce, many from the EU.

The Construction Industry Training Board has led a number of schemes since 2017, aimed at fostering more home-grown construction workers.

Most notable has been the Construction Skills Fund – led by the CITB on behalf of the Department for Education – which aims to have trained 13,000 construction workers by the end of this year.

Will this and other projects provide enough labour, especially when hugely labour-intensive and heavily-delayed projects like HS2 and Crossrail drain resources at the same time as ambitious housebuilding targets are to be met?

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Boris Johnson may dismiss such concerns as examples of doomsters and gloomsters – but that doesn’t mean these challenges will not exist. Whether Britain meets these challenges is largely up to the politicians – but our industry will have to be prepared to monitor and match the changes as they emerge in the years and decades to come.

An estate agent has set up his own buying operation because he claims the quality of service for high-end buyers has “dwindled” in recent years.

Matthew Jackson, a former head of new homes and investment at London-focussed agency Chestertons, has now set up Oakmont Private Office.

He is damning in his assessment of how the industry has served well-heeled clients.

“Throughout my property career I have seen a decrease in the level of service clients receive from those who are meant to be acting in their best interests, with advice being far more focused on what will earn a fee than the creation of longstanding relationships” he says.

“I have therefore set up Oakmont to become a leading private office for international high net worth families and individuals, and to provide them with the best possible property advice and client engagement to create close and enduring working partnerships for many years to come.”

Jackson says his business will offer a bespoke service for HNW families and individuals in prime areas of London and the South of France, including Monaco.

A statement from the company explains that it will be “acting as the intermediary between selling agent and client, Oakmont manages the sales process from start to finish to include establishing an exacting mandate for each client, providing impartial and independent advice, shortlisting suitable properties on and off the market, undertaking full price and market related analysis, submitting offers, negotiation, pre contract due diligence, steering the transaction through to completion and collecting keys.”

Jackson’s business will also offer overseeing and/or organising refurbishment works and looking after property when vacant.

He will also offer a complimentary sales management service “to ensure the process of selling is as efficient as possible.”

Some buying agents have batted away the many signs of an improving housing market but one says the Boris Bounce is likely to create a huge boost for prime London.

Fraser Slater, chief executive of buying agency Ludgrove, says: “With a vastly improved political backdrop, the threat of a hard-left government removed and Britain’s transition out of the EU settled, we expect 2020 will be the year the prime London property finally regains its mojo.

“Strong pent-up demand, limited stock availability and the backdrop of a record five year-long property bear market is likely to provide upward momentum and we forecast prime London prices and volumes to grow around 10 per cent and 20 per cent respectively in 2020.”

He says there are nine key factors behind the predicted boom.

1: adjusting for inflation, prime central London prices have fallen -28% from 2014 to 2019. Historically very similar real-terms declines were recorded at the point of previous troughs in the market in 1992 and 2008, says the agency;

2: the 2014-2019 Prime London property recession at five years in duration has been the longest in 30 years, making a bounce well overdue;

3: relative to the mainstream London property market, prime London prices are near a 10-year low, making ‘trading up’ more affordable;

4: there are “extreme levels” of pent-up demand and a limited availability of stock;

5: rental values are rising as supply diminishes in response to government tax changes – a trend Ludgrove expects rents to harden further in 2020 as the full impact of mortgage interest tax relief changes take effect from April;

6: future housing supply in London’s central Zone 1 is set to decline significantly on the basis of recent ‘construction starts’ data;

7: Sterling still trades near a 40-year low against the Dollar making UK properties appear cheap;

8: finance is cheap with mortgage costs having fallen 39 per cent since the peak of the market in 2014; and

9: there remains a possibility of a stamp duty cut in the upcoming March Budget.

“The last five years has seen an almost perfect storm of negative news flow affecting prime London property, and we are now confident a sunnier climate is on its way” insists Slater.

“Having studied past bear markets as a former fund manager, market bottoms are characterised by extreme negative sentiment, despondency and despair with the recovery in price typically being a function of an amelioration of negative news flow and fundamentals … And it is in this context we are confident we will look back on the dark days of 2014-2019 as a time when a bull market was ‘born in pessimism’.”

Data from HM Revenue & Customs shows tax receipts from stamp duty fell a further 5.2 per cent between 2018 and 2019, part of a broad decline in income since late 2016.

The figures have prompted a demand by Jackson-Stops’ chairman Nick Leeming that the government wake up to the fact that the duty is unpopular.

“In order for the UK property market to thrive again and provide the economy with the extra boost it requires, we need the stamp duty pledges Boris Johnson made in his original campaign to be Prime Minister to come to fruition” explains Leeming.

“We’ve already started to see some initial green shoots of recovery in the London market as demand among buyers increases, however ensuring this confidence follows through to sellers to unlock supply of homes is vital.

“Recent research of ours shows that 41 per cent of consumers believe there should be a wholesale reduction in stamp duty across all price brackets, while more than a quarter think government should abolish stamp duty on all homes under £500,000.”

There is growing concern that broad pledges on stamp duty made in the second half of 2019 by politicians – ranging from a wide-ranging call for its reduction to more specific proposals about shifting emphasis from buyer to seller – appear to have fallen away since the General Election.

The only specific manifesto pledge on stamp duty from the victorious Conservatives in last month’s General Election was to introduce a three per cent surcharge for non-residents buying UK residential property for investment purposes.

“It all currently rests on the changes Chancellor Sajid Javid decides to implement in the upcoming Budget” explains Nick Leeming.

The high-end estate agent who has quit his post after being found to have posted pictures of clients’ houses on Instagram has been named.

Last week The Times made reference to speculation that an agency was being sued by clients upset at seeing images of their properties on an individual agent’s Instagram; but now the Financial Times has identified him as Knight Frank’s Daniel Daggers.

The FT, and other national papers quoting the FT, say that Daggers was nicknamed Mr Super Prime on his social media hashtag, and had claimed to have successfully sold £3.85 billion of properties, including a £95m mansion at London’s St James’s Park, bought by a US billionaire, and an unmodernised off-market house sale in central London worth £45m.

As of last evening, Daggers’ Instagram profile referred to himself as “The Luxury Real Estate Advisor”; amongst the images posted is an eight-page presentation of his 2018 and 2019 performance which includes £241.67m in sales deals.

Estate Agent Today contacted Knight Frank after emails to Dagger’s Knight Frank address received an out of office message saying: “This mailbox is no longer monitored” and giving enquirers the email address of a Knight Frank negotiator.

A statement to EAT from Knight Frank itself says: “Knight Frank can confirm Daniel Daggers resigned in November 2019 and will leave the firm in February 2020.”