BREAKING PROPERTY NEWS – 10/08/2021
Daily bite-sized proptech and real estate news in partnership with Proptech-X. Today, Stanton looks at ViewRabbit’s take on the property viewings model, the lack of housing stock, and the mortgage lending landscape.
- Let them eat cake AND pay £30 for a viewing
- Is the lack of housing stock holding back the market?
- Is mortgage lending about to enter a period of reflection?
Let them eat cake AND pay £30 for a viewing
What do these two things have in common?
- Marie Antoinette’s quote “Let them eat cake” when asked what the starving French should eat as they had no bread.
- Mike Riley’s ViewRabbit concept and the idea that viewings could be charged at a rate of £30.
Is the answer a major disconnect with what the consensus appears to be? Let’s find out.
In Marie Antionette’s case, she had no idea of the world outside her palace. To her, substituting bread for cake was a sound option. At first glance, it would appear that ViewRabbit is also at odds with the consensus. But here’s the kicker, is it out of step with public sentiment or just out of sync with the estate agents’ legacy models of doing things?
If the latter is true, is that really a bad thing?
For me, ViewRabbit is probing the wants and needs of those in the property nexus, who live in a society where services and goods are leased and hired rather than owned. And things will inevitably be leased, hired, purchased, acquired, etc. Nothing stays dormant for long.
So, in return for a certain sum upfront, ViewRabbit will guarantee that a viewer gets a slot to view a property, giving prospective buyers the power to freeze time. Cash equals convenience. Viewings on demand.
If they want to, buyers are still free to take the traditional route and view the property via the agent. But, as any of us who have been in that position knows, it might be a gamble depending on the level of interest.
It seems that a handful of agents aren’t happy with ViewRabbit upsetting their legacy modus operandi. Now I’m not saying it’s like the French revolutionaries escorting Marie Antionette to the guillotine. Viewings are still free, everyone knows that.
But has anyone asked the general public for their view? Have any agents canvassed the buying public, or do they sit in their ivory branches like Marie Antionette, guessing the mood of the people?
Now, this is anecdotal, but earlier in the year I wanted to view three properties. I was in a position to buy but they were snapped up before I had a chance to cross the threshold. Who knows, maybe I would’ve purchased one, but indifference from the agent and lack of service meant that they were satisfied with their first sound enquiry. Many people missed out thanks to those agents.
As someone who marketed 18,000 properties over thirty-plus years as an agent, I am far from being anti-agent. I am, however, anti-lack of service. In my mind, my time is more precious than everyone else’s. If there’s extra money on the table, maybe it will jolt people into action.
Maybe ViewRabbit does have a point after all.
Is the lack of housing stock holding back the market?
In other news, according to Propertymark metrics, the inventory level of property for sale in the UK, at the local branch level, is only at 60% capacity. Typically, an agent will have stock of about 35 to 38 properties on their books.
Of course, there is a huge national variance; city agencies often have hundreds of properties to choose from whereas village agents will have stock levels in the mid-teens…sometimes less.
Now it might just be a rebalancing of the market because there are usually 1.2 million completions each year. This year it looks like that number might be closer to 1.4 million, with a huge amount of properties already completed before the end of the SDLT holiday at the end of July.
Nathan Emerson, CEO of Propertymark, which has over 17,500 members, said: “Sellers have seen the headlines about the huge demand and are nervous about joining the market and selling quickly with nowhere to go.”
He may well be right, but also we are in the holiday season. We are also emerging from pandemic restrictions for the first time in quite a while, so everyone is focusing on piecing their lives back together rather than focusing on the pressures of moving home.
Traditionally, all housing markets cool when the schools are out, with a swift amount of activity in September. So a better picture of what is really going on will emerge a month into quarter three.
Until then it’s a guessing game.
Is mortgage lending about to enter a period of reflection?
During the pandemic, all lenders battened down the hatches and required borrowers to comply with more stringent criteria. Bigger deposits were required and people who took mortgage holidays or accepted Government-backed pandemic finances found it impossible to get housing finance.
Now many are asking those in the lending industry to make borrowing mortgages easier as the country comes out of lockdown and normalises.
But the Mortgage Advice Bureau, through their leading man in lending Brian Murphy, feels that a slower and more careful approach was now required.
Murphy said: “…the impact the pandemic has wreaked on the economy, particularly in terms of unemployment, has not been as severe as most were forecasting. Once the last of the government support measures have ended, there will no doubt need to be a period of reflection while lenders assess the consequences before normalising criteria to pre-pandemic levels.”
With the Bank of England base rate at 0.1% and mortgage products launching at less than 1%, it will be interesting to see which lenders break rank first to pander to the needs of the borrowing nation.
If you have a view – please let us all know by emailing me at [email protected] – Andrew Stanton Executive Editor – moving property and proptech forward.