BREAKING NEWS – top 5 stories 12/03/2021
SAVILLS SEES PROFITS HIT
Pre-tax profit fell by 28%, down to £96M from £115M, Savills are bullish about the coming year, but clearly there are clouds on the horizon with a raft of Nom-Dom taxes on the horizon from April. Clearly, they have a global brand, but in an uncertain world, financial liquidity is certainly not what it was, fuelled by the pandemic.
THE TIMES LEADS WITH A CALL ‘TO GET BRITAIN MOVING’
Over my boiled egg and soldiers I read with interest the piece in The Times by Carol Lewis ‘Buying a Home Can be a Quick and Painless Process.’ The sad reality is that it is the mindsets of the gatekeepers that stop any real change in this sector.
But in some ways, I do not agree with one part of The Times strategy, as having been an agent for over 30 years I do not see that binding a buyer in at the point of offer will lessen the number of sales falling through.
In 1986, sales took 10 weeks, in 1988 2M sales completed, we now complete on 1.1M sales annually and they take 26 weeks to go through – that is the problem. The longer the period between offer accepted and exchange of contract, the more likely that the sale fails, typical cancellation rate pre-pandemic 28% to 31%.
Complete digital transformation of the legals and the lending is required, paper and legacy systems need to give way to digital. There are many initiatives going on some of which I have been involved with from HMLR Digital street, Stuart Young Etive, young geniuses like Riccardo Iannucci-Dawson and his Yourkeys, Sally Holdway and her work, Joe Pepper and the TM group.
But it is the closed mindsets of the top gatekeepers that are the real road blocks to a joined up and effective solution to residential. I have written numerous articles about this very sector, having been in the hot seat with a £400,000 pipeline of potential sales, only to see £125,000 of potential fee being lost due to cancelled sales
ALEXANDER & CO CONTINUE THEIR GROWTH
I am biased as I know Alexander & Co and I know them to be topflight concern. They are as it happens local to me, having bought up a number of agencies in the vicinity, and their original nucleus was very much in my own patch back in the day of being an agent.
Their latest acquisition Macintyre’s in Brackley, is also known to me, and is a plum operation to snap up for sure. As a real estate analyst, the pandemic has proven to be a catalyst for growth for some – think Connells/Countrywide, with scale and technology very much the levers to enhanced profitability.
BATTLE LINES DRAWN ON MODERN METHOD OF AUCTION VS TRADITIONAL AUCTION
A traditional Auctioneer has called out the MMA system of selling property, which has advocates such as Jamie Cooke the founder of Iamsold. Richard Corpus feels that for some MMA is not the best option, in reply the founder and CEO of Iamsold believes there to be complete transparency.
Given that both ZPG and Rightmove are promoting MMA on their sites it will be interesting to see who pitches into this debate.
SIGNS OF NEW BOTTLENECK OF SALES FOR END OF JUNE
To avoid the March bottleneck of sales that would not complete in time to avail themselves of the reduced tax level, the Chancellor extended the period three months.
Anecdotal analytics are showing that sales are now moving briskly, the downside being that many conveyancers are not taking on new work due to furloughed staff and working through the sales they already have. Which all points to a new cliff edge in June.
There is another government petition, started earlier this year by Anthony Antoniou, which requires 100K signatures, asking for stamp duty to be abolished for good for sale prices under 500K. It will be interesting to see if this hits its target.
https://petition.parliament.uk/petitions/558610
It only has 511 signatures to date – but that can all change.
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