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4th March 2019

Property Market in Full Swing

Redbrik turned six in January, yet I cannot remember a time during these past years where we have been asked more frequently “how is the property market?”

I suppose it is understandable – given some of the recent press reports and the ongoing political uncertainty of the past few years – why people might be concerned. 

However, it is fantastic to reply honestly with positivity about what is going on locally. Since publishing the previous edition of this magazine in November 2018, we have experienced a series of record-breaking months, with more and more clients buying, selling, renting and letting with Redbrik.

In every measure of the business, we are outperforming where we were a year ago. So why then are all the reports we read and hear so negative, which is in stark contrast to what we are experiencing? And why does it seem that now, more than ever, people are so interested in the property market? 

Well, firstly I think the reporting is easy to understand. 

Press scaremongering with headlines about a 33 per cent fall in house prices are great headlines. The reality, of course, was The Bank of England stress-tested UK banks, to see if they could withstand a 33 per cent fall in house prices. The BOE did not say this would happen, and all the banks passed the stress test, but that is not going to sell newspapers.

The news that in central London speculative house prices are falling, which often fuels the national press and makes great headlines, is really of no consequence for the vast majority of us. Many of the £5m-plus properties are bought for speculative gain, similar to cars and art. Prices at this level are widely expected to fall by 20 per cent before, no doubt, rising again.

I have said before that there seems to be one market inside the M25 and another outside. It is the latter which, to continue the dancing analogy, has a spring in its step. 

The good news for Redbrik clients is that the property market is right on the beat and most definitely in full swing for Spring. The Daily Mail recently carried a report compiled by The Advisory – an advice and support resource for house sellers – highlighting that two of the top ten postcodes in the United Kingdom to sell a property are in our region – S8 and S11. 

Nationally companies are looking towards Sheffield and Chesterfield for inward property investment, with grand schemes in the pipeline. Waterside in Chesterfield is edging ever closer, and the cranes should soon be adorning the Sheffield skyline too, with work commencing on the first two residential buildings in Heart of the City II.

There is also a lot of adverse press speculation about the struggles of estate agents, – however it is really just two types of agents that seem to be struggling. The cheap ’self-service/on-line’ agencies and the bigger, national corporate chains. The online self-titled ‘disrupter’ businesses have spent millions of pounds on advertising, trying to convince sellers they are able to solve their moving needs. However, the promise has not always been the reality. 

As many as 5,000 Emoov customers nationally, who had paid their selling fees upfront, were left high and dry in December when the business, once valued at a reported £100m when it merged with Sarah Beeney’s Tepilo, went bust (read more on page 13). Operating losses at online estate agent Purplebricks more than doubled to £25.4m in the six months to the end of October 2018, from £11.4m in the previous half year. Yopa also filed accounts showing cumulative losses totalling £32,250,786 over the last two years to 31 December 2018.

Many industry commentators expected that the ‘online listers’ share of the UK property market would grow to 12-14 per cent, some even predicted 20 per cent. Instead, evidence from TwentyCi, – the property and home-mover data firm, – show online estate agents achieved just 7.2 per cent of all exchanges in the final quarter of 2018, slipping back from 7.6 per cent earlier in the year. It also highlighted the struggles the sector has with selling properties priced at over £200,000.

Estate agency is not a product, it is a service. So while it is an appealing thought to potentially save a few hundred pounds (often not the thousands some still claim) on agency fees by instructing a low-cost alternative, the vast majority of people understand the value in paying for a high-quality service that will actually generate a better return overall. 

Equally, the press has had a field day with the significant demise of some of the more traditional high-street agents too. LSL, which owns high-street brands Your Move and Reeds Rains, have announced huge redundancies and office closures. Countrywide, which owns brands operating locally such as Blundells and Frank Innes, has seen its share price tumble by approximately 90 per cent during 2018 amid torrid performance figures. 

Redbrik has high street offices, but we have never classed ourselves as traditional. We focus on three things: People, Systems and Marketing. You have to be brilliant at all three to succeed, but the most important is people. If you don’t have excellent people and a great culture, systems and marketing will only take you so far, and last so long. 

It was incredible to be recognised for our quality in all three of these areas when we won the Best Estate Agency in Yorkshire & Humberside in the 2019 Best Estate Agency Guide supported by Rightmove.

These awards are considered to be our industry’s Michelin Guide, so to be the number one estate agent in our region is a testament to everyone’s consistent hard work and desire to be better. The awards, which look at performance on Rightmove and conducts 50,000 mystery shops to ascertain service levels, point to why we believe we are successful in today’s property market in comparison to others. We know we have to have the best online marketing and also the best off-line marketing and personal service too.

We know we can never stand still or stop learning and improving. One of the critical findings for us at the awards was the knowledge that a decade ago, statistics showed that people in the UK moved on average every seven years, today that statistic is every 23 years.

People buying and selling homes are doing so far less frequently and need help and guidance through the process. Moving home is really not something you do every day. It also explains why so many people ask us how the property market is going. When you are not doing it every day, you are naturally curious and want to understand how your single biggest asset (and your home) is performing. Perhaps this is another reason why we continue to be successful, and the seemingly less personal online/corporate business models are struggling. 

We place huge stock on our team, aiming to recruit top talent and then helping them continue to learn and develop. We work with some of the very best industry professionals both nationally and internationally to aid their development.  It is to this end we have a learning trip planned to the West Coast of America this year. As one of the UK’s top independent agencies, we have been invited to visit some of the very best businesses in the world, with like-minded agencies from the UK and Australia. It will be great to see and identify new methods and activities that will aid our customers in our quest to help everyone find their home in the world.