Who gets to wear the moneybelt?

So millions of us stayed up to listen or watch the big event in Las Vegas last night: ‘Money’ Mayweather v the Irish fella, who if the rules of pugilism weren’t being followed would probably rip you limb from limb in the time it takes to say “that’s a nice tattoo”. The build up to this money spinner that looks likely to surpass the $600m earner of Mayweather v Pacqiao in 2015 seems to have been going for at least as long as the Labour leadership contest, but at least with a far more entertaining way of deciding who will be victorious. For all the vitriol and combative ’performing’ it was interesting to learn that both adversaries had travelled to many of the build up events in the same plane and had gotten on rather well…my dear chap. In spite of all the ‘trash’ talk, post fight both parties have nothing but good to say about each other. The cynics amongst us may say that the riches of Croesus can make the most ardent of enemies see each other in a far more mellow light

So what has this got to do with a bank holiday and the business of selling houses? Dubious outfits in shiny, perspiration-unfriendly material aside, there are many similarities. Let me explain.

Many of us in the world of estate agency in the NP4 postcode and the surrounding areas have been colleagues for some time. We socialise together and attend industry events. Sometimes we do a ‘Mayweather’ and tell our story of how good we are and how we will beat the opposition without question. Some of us have even been known to produce certificates to prove our brilliance…you know who you are. Sometimes we lose the fight through a knockout, sometimes on points (yes, even me) and the seller opts for the opposition. At this stage, many of us engage in grown-up post-fight talk and say good luck to the other party.

This week I have experienced a perfect example of the bad loser trash talking. Having been to a valuation, I was given the instruction over two other agents from the area. Yesterday one of these agents rang the vendor (after 1.30, the published closing time of Cheshire & Co and on a bank holiday weekend when the office will not reopen until Tuesday). My industry colleague told the vendor that they had someone looking for the exact house owned by the vendor and that they wanted to make an offer. So eager were they that wanted to do it that very afternoon. As the property is empty could the said agent have a key and take the desparate-to-buy-that-house purchasers for a viewing? In order to do this-and guarantee their sale-the vendor would have to sign a contract with the agent there and then. The vendor then rang me directly on my personal ‘phone-obviously not factored into the other agent’s cunning plan-recounted the tale and asked what I would do?

The aforementioned agent was rung and was told that of course they could view the property; just ring Mr Cheshire and he would help by meeting them there and doing the viewing for them. If this particular buyer bought the property, Cheshire & Co would happily split the commission with them (generosity is my middle name). The only caveat was that the agents were not allowed to advertise the property and then record it as their sale (but they would still have the money). Alternatively, their purchaser could come straight to Cheshire & Co on Tuesday (they could even email the office in the interim) and the said agent would get the square root of naff all.

The choice was theirs to £$”* up. Guess what? They did not want to agree to any of the suggested options and the Marquis of Queensberry rules got drop kicked out of sight. What it does mean is that I and their fellow industry competitors are more likely to bend the rules next time we meet in the ring; punch on the break, slightly low blow or leading with the head. Ah well, I tried.

Colour Blind?

Geoffrey, George, Zippy and Bungle. A disparate bunch (was anyone else intensely irritated by that bloody bear? With his hand-wringing wetness, one just knew that he would be a sandal-wearing, bearded, lib dem voting drip). The gang greeted us five times a week with the cheery, “All above the streets and houses”.  Very apposite this week as many in the business of selling streets and houses got very excited about one of their industry competitors and the said competitor’s seemingly imminent demise. Or not. The arch villain of the piece was purplebricks (PB) who featured on both Watchdog and Radio 4’s consumer affairs programme You and Yours. Firstly, let us acknowledge the power of the t’interweb; I would guarantee that there wouldn’t be many estate agents who would have the radio tuned in to such cerebral listening, but through the medium of bashing away at a smartphone every agent suddenly was able to comment on what had gone down. What exactly had occurred? Well, there was something of a hue and cry about PB’s shady practices involving getting a customer to part with their money. Much was made of the non-payment of the up-front fee charged by PB. This was described as a “loan” facilitated by Close Brothers Finance (same synagogue maybe?) Not true said PB. The customer not paying the money but having the debt met by a third party is not a loan, but a “deferred arrangement” and thus does not come under FCA regulation. Still with me? Why such delight in the supposed discomfort of PB in having to explain their business practices on a national radio programme? Ah well said the sages, PB’s share price will have fallen and they are doomed. Mmm. Yup, the share price did fall by 7% and millions were wiped off the company’s value. Cue high fives and big-ups by estate agents across the land. And what happened? Nature abhors a vacuum and the same premise can be transposed to the stock market. Shares in PB suddenly became much cheaper to buy. So guess who bought them? Those very same uber wealthy gentlemen who already own PB. And the result? PB’ share price rockets again and actually sits higher than it was before. Market forces. Not dissimilar to professional gamblers backing a horse in from 25-1 to 14-1. The price shortens; an ideal opportunity to lay it on the exchanges. The market reacts, the price lengthens and those same wealthy (and ballsy) boys and girls get a second bite of the cherry, backing it to win again at 25-1. Back to PB; who were the losers? Not the Bruce Brothers indeed Kenny and his sister in law Isabel sold £23.8m worth of shares in March if I had just pocketed that type of money I doubt whether watchdog or radio four would bother me that much. One other point that many missed entirely was that the vendors who part with their cash upfront are paying for a service, not a product and more fool them. How many restaurants do you go into and pay before the meal? Much was made of PB launching in the USA where agents or ‘realtors’ fees can be up to 10%. I will be intrigued to see how they propose to sell up-front fees to the land of the free and the service capital of the world. If they succeed in this, Kim and Donald should put their handbags away and let Team Bruce run the world.

May I suggest that a lot of people missed the point? PB are not a threat to good, traditional, independent estate agents. This is not said with bravado and false hope. Cheshire & Co and many of our fellow independent agents in the NP postcode have a very different business model and are appealing to a very different demographic than that of PB. Our business is based on recommendation and referrals and there are certain clients and families who we have represented and looked after who would never go to anther agent, let alone one based online. We all have such clients and we are all in the business of trying to get more of them. Our (and by this I mean all independent agents in the vicinity) biggest threat is that posed by our immediate geographical competitors.

I would further suggest that many agents in the NP postcode have been struck by colour blindness and I am not referring to the rather dubious decor in some offices. Forget purple, it is the colour pink that has caused the biggest ripple in the pond. Have I ever been to a valuation in competition with PB and lost it? Never. Have I been in competition with Pinkmove (PM) and come close, but no cigar? I have, as has every one of my fellow agents, independent or corporate. I must state that I was using WAL photos and videos before PM launched, but why now does nearly everyone of my fellow agents offer wide angle lens photos, floor plans and videos? Of course, the quality varies immensely, but the key point is that PM (or a similar outfit in another area) has changed the game. Back to market forces. This does not mean that all of my fellow agents have upped their game. Some are in a race to the bottom, to offer to do it as cheaply as possible with the primary focus being on doing it for less than any other agent and sod the service provided is moving into PB territory . Again, this will appeal to a certain demographic-but isn’t financially sustainable-as we have discussed in previous blogs and oblivion is just over the hill. Back to the service industry: as independents it is the service that we provide that grows and sustains our business. Falling short in this area means that we have no business.

A picture paints a thousand words…

Back in the day when I got my first job in estate agency some 40 years ago, (I know, I know, Dorian Gray has nothing on me), my old boss used to tell me to ensure that the details that I was dong that day should be the best set that I had ever produced. Unless, I had the right house in the right street at the right price; then he advised the minimalist approach of “House for Sale” and leave it at that. It took some kahunas and a fair amount of wringing of sweaty paws, but it worked.

Why do I reminisce about these days, (apart from the fact that I had hair)? Well because I have noticed a trend emerging in the NP postcode of fellow agents using very scant details which involve a brief overall description and then room sizes only. Quite frankly, an “absolute bloody shower” to quote one of my role models, Mr Terry Thomas and my old boss would be somewhat unimpressed. But, much as it pains me to see shoddy work (ladies, if you are going for surgical enhancement, don’t go Central European, they never look quite as good), I have had two separate viewings this week where on both occasions the potential buyers said, “the rooms are very small aren’t they?” Resisting the urge to reply with, “they are exactly the same f£$*ing size as they say on the details”, I suggested that we take a look at the said details and check the room sizes listed. Both parties nonchalantly informed me that, “We only look at the photos”. Okey fricking dokey.

In the era that we dwell everything is available on a hand held device and is immediately accessible. Bright, shiny, pretty pictures for all to see. The lesson? Make sure that your pictures are the best that they can possibly be and that may mean that the agent-however much he fancies himself as the next Patrick Demarchelier-is not the best person to take them. In fairness, many NP agents do outsource their pictures and many charge you extra for the privilege of their incompetence! You can see the results online-just as the thousands of potential purchasers are able to do. This includes the online agents where some of the pictures seem to have been taken by my grandson. But there is no margin in the cheap upfront fees charged by the onliners to do anything than use the old box brownie

What have I learned this week from my experience? Confirmation that my old boss was on the money. The right house in the right street at the right money will sell, don’t bother with all the writing. When an agent and vendor work together to market a property at its most attractive (including the price) to potential purchasers, then there is no need for gimmicks. Sometimes I miss the good old days, not least the need to buy shampoo.