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Paul Smith

December 2008 / January 2009

Staying ahead of the game...

AT a time when estate agents and Home Information Pack providers are going to the wall, it seems the Government is once again meddling with HIP regulations, sparking rumour and uncertainty within the industry.

We hear that the regulations about first day marketing and personal searches are set to be amended, causing a big headache for all agencies who have been implementing their policies and procedures in accordance with Government guidelines.

Currently, first day marketing can commence without a HIP in place, provided the documentation has been ordered.

On January 1st, a full HIP needs to be in place before marketing, but our sources say it might even now be April before this is implemented.

It is also thought that the exemption which means personal search firms can insure against missing information will be extended to April to ensure that local authorities are ready. Their fees are likely to come under further pressure.

I have also been reliably informed the Government will introduce a ‘PIQ’, a Property Information Questionnaire, which is moving towards an exchange-ready HIP, something we would prefer — that’s if we really have to carry on with this nonsense.

It’s outrageous that once again the Government is playing politics with people’s livelihoods, without thinking about the personnel who have been brought in by companies such as ours to implement these changes.

This all comes at a time when companies are cutting back and planning how they will make it through the recession.

All the forecasters are predicting a gloomy 2009. It will surely be an interesting year for all of us. I congratulate all those estate agencies who are being innovative and imaginative in identifying ways of staying afloat. It really will be survival of the fittest.

A wrong move for Rightmove?

THE news that Rightmove Overseas is planning to offer listings to private sellers in other parts of the world is sending a further chill of uncertainty through the estate agency community.

The portal currently charges overseas developers and agents £250 per month to list 100 properties. It is now planning to charge private sellers the same fee for listing their property for three months.

The obvious question is how long it will be before Rightmove brings the system closer to home? Some observers are suggesting the ploy is simply setting a sprat to catch a mackerel; testing the water to see whether an adapted model would work in the UK.

Rightmove vehemently insists it has no such plans here. The portal argues the overseas market has always been very different from that in the UK and that allowing sellers to advertise privately is a common sense reaction which would allow Rightmove Overseas to compete with other large overseas property portals. It also points out its market dominance at a time when sellers need their properties to be as visible as possible.

But why set something up which is bound to send jitters through an already jumpy industry, at a time when free listing sites such as Globrix, Zoomf and Mouseprice are multiplying and the National Association of Estate Agents’ Property Live site is set to take market share? Certainly, the cost per lead from Rightmove has shot up and is now a far less attractive proposition than it once was.

Is it because Rightmove has lost an estimated 2,000 agents during the past year that it now needs to look elsewhere to raise the cash? It’s a frightening statistic considering it estimates three quarters of those departed members have either gone bust or are going under.

Times are as tough for Rightmove as they are for the rest of us and they have shed a fifth of their workforce in order to make £5 million savings. However, Rightmove need to be responsible and use their authority wisely for the benefit of all in the property market. They need to listen to their client base, show that they care, reduce subscriptions to a sensible level — and stop frightening the horses with novel initiatives at a time when prudence and support for the industry would be more useful.

Be like Scrooge — trim the fat this Christmas...

WITH Christmas fast approaching, estate agents will have to show some Scrooge-like tendencies if they want to be around to enjoy their festive presents in the New Year.

For those who haven’t yet trimmed the fat from their business, there is still time to become leaner and stronger, and one of the easiest ways to cut costs is to negotiate rent reductions or payment holidays with your landlords.

It is something we have undertaken very successfully at Spicerhaart — and although landlords may be resistant at first, they quickly realise it is better to have a tenant paying something than to have no-one paying nothing.

There is plenty of evidence to support your request for a rent reduction.

The Royal Institution of Chartered Surveyors have warned that the demand for commercial property is falling at the fastest rate for a decade and could push rents down 10 per cent by 2010.

Inevitably, this puts occupiers in a much stronger position to barter for better rates and stronger incentives.

Given that there is no ‘fair rent’ system or regulation governing business leases, it is up to you and your landlord to agree what your rent will be and how often you review it.

Some landlords will try to include a provision that the rent should never fall below the starting rent, so check your lease closely and consult your legal advisers.

For the sake of a few letters and phone calls, it could be one of the best business decisions you make.

After all, Scrooge may have scrimped and saved in the early days. But in the long term, he didn’t turn out too bad after all. Happy Christmas everyone!