Lean in and I will let you into a little secret…

…estate agents are not interested in buyers, they are interested in vendors.  Was that the water in the font that I heard bubbling?  If an agent can get the instruction, then the buyers will come, no matter how uninspiring the performance. All the sales/tactics courses run by the large corporate organisations and training companies concentrate on sellers. Go on enough of these and agents become very accomplished at establishing the knowledge or greenness of the prospective buyer.  As a result, many willing participants are led like lambs to the slaughter house by unscrupulous agents.  Take fees: ring any agent, anywhere and ask what their fees are and I would bet the value of Sharon Osbourne’s plastic surgery bill that you won’t get a straight answer.  Answers from, ‘very reasonable’ to, ‘we like to discuss that at the valuation’ will be uttered with sincerity.  Why the inability to give a straight answer?  Because the agent will-having spoken with the prospective client-try and charge as much as he thinks that he can away with.  When an agent asks what other property professionals you have had out to the property, he is not displaying an exemplary bedside manner, but trying to establish what other fees they have been quoted, before they mention their own fee.  If it is established that the sellers are not engaging any other agent, then believe me, the fee quoted goes up.

Snake oil salesmen, politicians, estate agents, we tend to get lumped into the same bracket of moral turpitude. We all want to earn a wage, but sometimes, the behaviour of my fellow industry professionals makes me wince.  This week, I met a couple who have never before been involved in any kind of property transaction and the use of an agent.  Dear oh dear, they were skewered like new born puppies being mowed down from 20 paces with a machine gun. Having asked only one agent to come out to their property, who valued it at considerably, astonishingly more than what it was worth, they signed a sole agency agreement for 6 months at a fee of 3%. The property was not made available for 12 days, then 4 days later the same enthusiastic agent called to tell them that they had, “better reduce as no one wants it at that price”.  11/10 to the agent and I guarantee that he wins Employee of the Month/Decade.

Where in The Property Ombudsman’s code of practice is this type of behaviour covered?  In the merciless world of business, not least the part that covers property sales in Cwmbran, making the fastest, easiest, buck (or pile of them) is something that is rightly, encouraged.  But without wanting to sound too soft, let’s go hug a tree, how do you justify where you find yourself in this cavernous moral black hole? “The trust of the innocent is the liar’s most useful tool” Stephen King  This could be applied equally to those who campaigned for ‘protection’ of the public by establishing entities such as TPO and making membership a legal requirement.

Before anyone accuses me of disappearing up my own posterior, may I reassure them that I still drink, gamble (both within moderation), have a disproportionate loathing of anyone in a shiny suit and pointy shoes with gelled up hair and lust after a top of the range German manufactured executive saloon preferably with Miss Minogue in the front seat.

Who is actually protecting who?

In September 2014, it was made law that agencies letting properties in England, Scotland or Wales had to become a member of a redress scheme. As of 1 June 2015, agents had to show that they were a member of one of the approved schemes offered by a trade association or guild such as the National Association of Estate Agents (NAEA) and display the appropriate symbol in their office window.  Regular followers of the blog will know that I have an innate mistrust of trade associations and guilds, as they bear all the hallmarks of private clubs.  The only or indeed, ultimate form of punishment is to be excluded from the said club.  Without wishing to sound too agonistic, big deal.  Incidentally, membership invariably comes at a not insignificant financial cost. ‘Industry training’ and the equally enticing, ‘industry recognised qualifications’ are often trotted out as indisputable reasons for putting your name on the dotted line.  Whatever the industry may or may not recognise, these qualifications do not stop anyone breaking the law or the guidelines set out by Trading Standards.  On that basis, how does that protect the client?  But the agents are qualified  I hear you cry.  Well, I believe the Kray twins had two o-levels a piece and Hitler wrote in Mein Kampf that education was essential to ensuring that the Third Reich would last 1000 years.  Not that that worked out too well.

At Cheshire & Co we have always advocated that the concern of any agent should be focussed on the people who can really do one damage, by stopping them trading and therefore earning-this would be Trading Standards.  They do have teeth and are not afraid to use them as opposed to a club, I mean guild who when one feels their wrath could liken the experience to being savaged by a broken-mouthed ewe. Well, that’s guaranteed to get me blackballed forever.  In order to meet all legal requirements we have elected to join The Property Ombudsman’s (TPO) scheme which is as close to a government body and as far away from a private club as is possible.  The TPO insist that members must have professional indemnity insurance as well as public liability, so that in the event of TPO upholding a claim against us, it can be paid for by the insurers. So any headline that reads how Robublind Estate Agents have been fined £1million is a little misleading.  Yes, they have been fiend, No they are not finding the money to make the payment, that is the remit of their insurance company.  So who is actually being protected, the agency or the client?  By joining TPO and being subject to their T’s and C’s, they are actually protecting me. This is a good thing; particularly when nefarious individuals conduct themselves in an inappropriate manner, breach the terms as laid down by TPO, are handed a hefty fine, their insurers pay up and the award to the injured party is then split between the client… and the agent.  Cynical, moi?

“Where’s Dr Nookey when you need him?”

Knockers.  The word is used in many forms generating much amusement dependent upon its context. Cue a very young Jim Dale examining a very undressed Barbara Windsor to much oohing, aahing and knowing winks from the gathered Carry On cast.  We all love them. Oeuvres of the Carry On franchise that is…what did you think that I was talking about?  The lexicon of the property world has gained a new addition in recent weeks with the launch of the property app Knocker; that has been referred to in some quarters as “property porn”.  I would love to have been at the marketing meeting when the name was decided upon-and its Hugh Hefner-esque tag-line.  I wonder whether the ‘burn your bra’ brigade were suitably aggrieved, whether they were actually present, or whether-if present-they kept their inner Germaine Greer under wraps so as not to jeopardise their pay cheque?  I digress.  The new app will tell you via your GPS exactly what properties are on the market in the area where you are currently walking/standing/driving and will show you pictures of the interior and a floor plan of the selected properties.  Then, if suitably intrigued, you may walk up to the front door of the property, knock on it (the app doesn’t mention door bells) and be invited in to have a look around.  I have a couple of issues with this.  The app does not use Rightmove or OnTheMarket, its property portal of choice is Zoopla.  Well that is nul points for starters.  As agents across the country have been leaving Zoopla quicker than the surviving Labour MPs went about disassociating themselves from anything Miliband, I would hazard that the selection will be limited. It will also be approximately 6 months out of date; a Zoopla trademark.  In theory, the premise that if you are area specific, have an exact location that you can drive/walk to and can see immediately what houses are available and then quite literally stand outside the property whilst ‘virtually’ having a look around the interior is a good one.  I think.  Alternatively, you could just use a property portal from wherever you have an internet connection and type the postcode of your choice into the search facility.  As people do anyway.  One of the ‘benefits’ of the app is championed as being the ability to stand outside the property and then ring the agent to arrange a viewing.  If the said agent is unavailable or a viewing cannot be arranged, the opportunity is there to channel an Avon Lady tendency and go up to the front door to introduce yourself. Mmm.  There are still a few sellers who would simply open the door and say come on in, but aside from any security issue, they would have no idea whether the interested parties were in a position to buy the property.  The “porn’ analogy is not a bad one actually.  Just as someone watches an ‘art-house’ film because in real life they know they would never get a look-in with the pneumatically enhanced Svetlana-they can only dream-so a prospective purchaser can pretend that they could afford the 6-bedroom house with cinema and tennis court.  Standing outside the front door only adds to the experience.  Meanwhile, back to reality.

Read the small print…

This week seemingly got worse for Foxtons estate agents-or at least their positive publicity machine took a bit of battering.  This followed the previous week’s outraged reporting of how they had charged a landlord £616, “to change a light fitting”, when the actual contractor had ‘only’ charged £412.50-a mark up of 49%.  Personally I would be more outraged that a contractor could charge just short of a monkey for changing a light fitting.  It must be said though, that there was no mention of what the work actually entailed-if the light fitting was the artisan work of maidens gluing pearls to a base hand-crafted by a remote tribe in the Pacific Islands, then maybe it was worth the money. If it was an ubiquitous, off-the-shelf number from a well-known DIY store, then they were having the tenant’s pants down. The standard bearer for the indignant and injured parties was none other than the doyen of television consumer programmes, John Stapleton.  According to his fellow reporters, Mr Stapleton uses Foxtons as his letting agents and when one of his South London properties had a problem with a leaky shower, he requested a fully detailed quote for the work required.  Foxtons obliged and provided a quote that came in in the region of a rather eye-watering £2000.  Mr Stapleton said thank you, but no thank you, found his own plumber and had the work carried out to his satisfaction for a substantially lower price.  Mr Stapleton and his equally aggrieved wife, Lynn Faulds Wood were appalled that the Foxtons had tried to charge them £2000.  The key word here is ‘tried’.  Foxtons chanced it and the odds on certainty got nailed by the handicap hot shot.  £2000 is exorbitant, but the fact that Foxtons tried to charge that amount, would imply that they have been successful in charging similar amounts on previous occasions and people have paid without discussion.  Welcome to the world of market forces.  If I tried that here in the NP44 demographic I would be told where on my person to put my quote.  All good letting agents should have a clause included in their contract that allows the agent to act up to a certain fiscal value without calling the landlord.  At Cheshire & Co it is £70, although some of our landlords have given us written permission for this figure to be raised to £200.  This protects all parties; the landlord, the tenant and the agent.  We do not charge a commission-some agents do-and this is written into the small print of the contract with the landlord.  I would be surprised that a behemoth such as Foxtons that will undoubtedly have its own in-house legal team does not have it written -admittedly well ‘hidden’ at the bottom of the penultimate page when most people have lost the will to live reading through it-that allows them through their terms and conditions an added percentage of fees and/or commission.  As Mr Stapleton and his wife have advised us on innumerable airings of Watchdog and its ilk, read a contract thoroughly-down to the smallest detail.

In a differing area of the press, Foxtons again got a mention when the city analysts opined that the likes of Foxtons and other big agents will start to feel the pressure-in the area where it really hurts-their share price, as the plethora of online, low fee charging agents continues to increase in size.  In another part of the business news, I read how Connells, the recent purchaser of our fellow Welsh estate agents, Peter Alan are now, “ramping up their acquisitions programme” and are buying up medium sized office-based estate agencies all over the UK.  What will be interesting to see is how each strategy performs; whilst we have long stated that the business model for office-based agencies must adapt, we-as clearly the boys with their hands on the piggy bank at Connells agree-are firmly of the opinion that there is still very much a place for them in the property world.

“Can we fix it?…Yes we can!”

So decreed the ever chirpy Bob the Builder and his erstwhile sidekick, Muck The Dumper Truck.  Suspending one’s disbelief for a second-not at the thought of a vehicle that can talk, but at the frankly preposterous suggestion that builders are a equable bunch with a ‘can-do’ attitude…I wondered whether today, Bob would ever get out of the starting gate at a planning meeting for children’s television.  Possibly, but he would now be in a same-sex relationship, with a child (that undoubtedly has attention deficit disorder and is allergic to nuts/milk/fresh air/hard work) and is considering doing a Bruce, I mean Caitlyn Jenner with a subsequent appearance on the cover of Vanity Fair.  What brought to the mind the irritating catchphrase was the news this week that Barack ‘I walk on water’ Obama now has an approval rating that is the lowest for any US president in the last 70 years.  When the 44th president of the United States of America assumed office in January 2009, it was on a tidal wave of great speeches and sound bites, that all followed a similar theme, “Can we fix it? Of course we can!” Or not, as the following five years have proven.  This dawning of a new era leitmotif also featured heavily this week in various articles discussing the triffid-like growth of online estate agents.  At Cheshire and Co we have -for some considerable time-commented that traditional estate agency has to change, just as it had to in the mid-70’s and as all business models have been forced to adapt over the decades.  Currently high street or any street agents are  suffering low approval ratings as their online competitors offer the panacea to all property and conveyancing problems.  But do they?  Of course, the £695 all-in fee is a huge draw, compared to an office-based agent who charges a far higher fee.  If all goes well, there is nothing not to like, but when something does go slightly awry, that call centre in Chelmsford may not be quite so helpful as they were when winning the business.  Not least because there is no office to walk into to discuss whatever the problem is and more importantly, its successful resolution.  I know the buzzwords in the IT world are security and firewalls, but there is no greater protection from an irate customer than only existing in cyber space.  There are four major building developments starting within the next 6 months in the Cwmbran area.  I would wager the price of yesterday’s Oaks winner that none of the developers will select one of these online agencies to facilitate their sales.

The approval of others also came to the fore when in France this week it was not only deemed to be illegal to hire a prostitute but also to dress like one.  Well that’s Newcastle in trouble (other cities are available) and Varteg.  At Cheshire and Co we have had several property dealings with members of the adult entertainment industry.  They are invariably intelligent, hardworking and honourable; if they have said that they are going to buy it, they do.  Approval was never an issue; on either side. As always, the more apt catchphrase, is “Show us the money”.