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Paul Smith

September 2009

Some good news at last?

ARE we finally climbing the steps after what has been a helter-skelter ride of a recession?

We have now passed the second anniversary of the start of the economic downturn, the moment on August 9, 2007 when French bank BNP Paribas suspended three funds facing losses stemming from US sub-prime lending that triggered the crisis in the banking world.

It has not been an easy ride but by nationalising banks and underwriting toxic debt, among other measures, the Government has shorn up the economy, albeit leaving a giant hole in the nation’s finances which it will have to recover over the coming years.

With lower interest rates, new shared ownership schemes, increased liquidity in the mortgage market and renewed consumer confidence, we now have some respite which we hope will continue for some months to come.

Our first six months of the year at Spicerhaart have been extremely strong, with sales up 44 per cent compared to the same period last year.

In July, branch sales were up by 133 per cent compared to 2008, with exchanges up by 83 per cent. We’ve had a 32 per cent increase in people viewing properties.

At the same time, the average price of property sold by us went down 14 per cent between June 2008 and June this year, settling this month at £161,158.

But something people seem to have forgotten is that the Stamp Duty threshold drops from £175,000 to £125,000 in January — at exactly the same time that VAT rises back to 17.5 per cent.

That’s a double whammy we really don’t need right now if the Government has got any sense. At the same time, further tax rises and public service cuts are inevitable if the Government is going to balance its books.

Unemployment, insolvencies and repossessions are continuing to rise and there is no doubt the third year of the credit crunch will not be an easy one.

I am concerned that a prolonged recession will create emotional and economic lethargy, becoming a self-fulfilling downward spiral.

The Bank of England has already declared it to be the worst recession in modern history and that it will take ‘several years’ before banks are lending normally to households and businesses.

Will this mean entrepreneurship will be suppressed or will risk-taking revive to rebuild both personal and corporate wealth? We must all play a part in rebuilding our own future.

It doesn’t pay to be an agent of discrimination

WHAT do you do when a vendor or landlord gives explicit instructions about who they want to sell or rent their property to — and who they don’t? What happens when someone asks you to discriminate on the grounds they don’t like someone’s race, religious beliefs, colour or ethnic origins?

As an undercover BBC investigation in Boston in Lincolnshire discovered, more than half the agencies contacted were prepared to breach the Race Relations Act of 1976 by turning away people from Eastern Europe in order to keep their clients happy.

But how can this be good for business? What price can you put on an agent’s reputation within the wider community if they are accused of racism? Surely it is better to show integrity and risk losing that client than be unethical?

So what should you do when invited by a client to aid and abet them in discriminating against prospective users of your services? You must simply explain that you cannot be an accessory to breaking the law.

The test of any democracy or culture is how well it treats its minorities. Conspiring against people because their faces don’t fit must have no place in our industry — and all agencies, as we do, should make their staff aware that discrimination of any kind will not be tolerated.

Massaging of figures devalues system for everyone

WHEN it comes to market share, all estate agents want to be number one in their local area. But what lengths will they go to in order to take pole position?

It has come to my attention that some agents may be ‘massaging’ their figures by loading their data into certain property portals more than once, making it look as though they have taken on more instructions than they really have.

It’s a disgrace if people are really stooping to such depths. We now have far more accurate reporting through internet analysis of market share compared to the days of counting boards and we need to feel we can rely on that data to produce results we can shout about.

If an individual gains a short- term advantage by fiddling the figures, it devalues the system for everyone.

Every agent knows the benefit of demonstrating their success rate to prospective customers. After all, wouldn’t you put your house on the market with the one that had the best success rate or was near the top of the pile?

So it’s important our prospective clients can have complete faith in the system — which means we must keep a close eye on those who are trying to pull the wool over people’s eyes.
If agents have reloaded their data in error or for technical reasons, then fair enough. If they have been doing it as a scam and the portals have not picked this up, then shame on them.

At the same time, why should all parties in a multi-agency deal claim a successful sale if they’re not the ones who brokered the deal? Why should one ‘piggy back’ off the other’s success unless, again, they are trying to manipulate their market share? If a property says sold, it should only be the victorious agent that takes the credit.

Monitoring sites such as Vizzihome can only keep track of the data that’s being uploaded. What we need is reassurance from the portals that checks are in place to stop their systems being abused in any way. That way we can all have justified pride when we claim to be leader of the pack.