BREAKING PROPERTY NEWS – 14/09/2021
Daily bite-sized proptech and real estate news in partnership with Proptech-X. Today, Stanton looks at fallout from the RICS independent review, the future of livestreaming property auctions, and Propertymark’s take on the new homes demand
- Fallout from RICS independent review lands at the feet of law firm
- Will auction houses have their Netflix moment?
- Propertymark says construction sector can’t handle new housing demand
Fallout from RICS independent review lands at the feet of law firm
Now the RICS scandal has seen the light of day, a glut of opinion pieces and dissections are emerging. This weekend, an excellent piece in The Times picked through the independent review and said that, in Alison Levitt QC’s opinion, Fieldfisher – a law firm based in the City, may have acted with a conflict of interest.
A fuller discussion of this point is outlined in The Law Society Gazette. In the interest of fairness to the law firm, its side of things has not been fully reported on. However, it would seem that this matter will rumble on for some time, at least until a number of senior hires are in place at the centuries-old RICS institution.
Will auction houses have their Netflix moment?
As we’re now, hopefully, exiting the pandemic, with things getting back to some semblance of normality, there is a big question being asked with regard to the modern approach to property auctions. Though many auction businesses have been videoing auction sales for many years, some for over a decade, it was not until the pandemic hit that buying through an online live stream found its moment.
For many years people could see what was going on at a property auction over the internet, but the buying and bidding on property was ostensibly carried out in the auction room. Yes, there were telephones and proxy biddings, but in the main, it was a physical event.
Squeezing into a large London hotel venue with free beer one end and a platform and an auction gavel at the other was quite the day out for property investors. Showing my age, the last time I went in person it was a smoky and noisy affair. One had to peer through the smoke and the well-mannered mob, to glance the master of ceremonies up on their platform.
Jeremy Prior, who heads up Auction House, tells us that through the travails of the lockdown saga, livestreaming has been a godsend. In his words: “Livestream sales have been spectacularly successful for us – even more so than we could ever have imagined … Not only have our success rates gone up, but we are seeing three to four times the number of people engaging with our auctions as we did when sales were held in the room.”
Auction House state: “Online Auction provides all the benefits of buying and selling by auction, with eBay style online bidding. Rather than needing to wait until our next regional in-room sale, suitable auction properties can be offered online at any time, with exchange on the fall of the virtual hammer.”
To access a livestream, those wishing to bid must preregister. They’re vetted, and then, in real-time, can incrementally make bids as the lot in question is being auctioned off. In this case, livestreaming might be better for the seller; more bidders get involved and international bidders are able to buy. However, this does mean that the momentum of sales takes longer with more players active.
So, will this modern method prevail, or will it be a return to hordes of people in large rooms trying to catch the eye of the auctioneer?
Propertymark says construction sector can’t handle new housing demand
In the September call for evidence statement to the House of Lords Built Environment Committee, Propertymark said that it had grave reservations with regard to the construction industry being able to deliver the volume of new homes required, blaming raw material shortfalls, rising costs and a fundamental skills shortage caused by Brexit. One particularly interesting extract is as follows:
6: Is the construction sector able to deliver the UK’s housing demand? What barriers are facing the sector?
16. Currently, Propertymark does not think that the construction sector is able to deliver the UK’s housing demand. We think this for two main reasons. Firstly, the continued impact and potential future implications of a shortage and increased costs of vital materials. To this end, materials price rises, and shortages have been blamed for a fall in construction output for the three consecutive months to August and the Coronavirus pandemic has had a knock-on effect on certain supplies.
For instance, a heightened demand for timber, on a global scale, caused by people staying at home and deciding to renovate their homes has pushed up prices as supply becomes increasingly difficult to come by.
Secondly, the short-term impact of the UK’s departure from the European Union (EU) has reduced capacity in the workforce to deliver with low levels of new sufficiently skilled people entering the industry causing concern for the longer term. In the third quarter of 2020 there was 28 per cent less EU born workers in the UK’s construction industry (30 per cent in London) when compared with the same period in 2019 – a decrease that was disproportionate to the 7 per cent fall in total construction employment.
This issue is compounded by low levels of new sufficiently skilled people joining the industry which has prompted the Home Builders Federation to launch a major campaign to futureproof the construction workforce by attracting a young and more diverse workforce into the industry.
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