WEEKLY NEWS ROUNDUP – 10/06/2022
A roundup of the week’s top property and proptech news stories in partnership with Proptech-X
- A four-day week for estate agents?
- The Guild: Property market remains robust
- Press Release: Satellite Vu partners with Landmark to provide vital climate change data to the UK land and property sector
- Press Release: 92% of Landlords Believe Employees Want More From Their Buildings – And They’re Prepared to Deliver
A four-day week for estate agents?
Although the residential sales and lettings industry is hardly a 9-to-5, five-day week sort of business as it is, could it be that a shorter working week is going to be the norm sooner rather than later?
As this week sees the start of the 4 Day Week Global project, a worldwide experiment where, in the UK, 70 SMEs are cutting their working hours by 20% but still getting full pay. The idea is to do more in less time and give workers a better work-life balance.
The businesses involved in the project span all verticals, including retail and sundry office-based sectors, and will involve over 3,000 people here in the UK. According to a BBC report, Juliet Schor, the lead researcher of the programme, the reasoning behind having a shorter working week is that “there’s activity going on in many workplaces, particularly white-collar workplaces, that’s low productivity and that you can cut without harming the business.”
Having run over a dozen agency businesses in various locations in the UK for 30 years, from quiet upmarket village locations to hugely busy sales operations in North London, if you had asked me a decade ago if cutting hours for the team was a good idea, I would have thought you insane. Now I think it is insane not to cut those hours.
Now, following the pandemic, with the acceptance that work is a much more fluid concept, especially with 40% of people still working from home as the norm, plus the Great Resignation movement, where a lot of people are downscaling or simply retiring sooner to live more, is it not time that labour-intensive industries like the property service business takes a brave step forward and embraces a shorter working week?
When I started in the industry in the mid-1980s, many financial institutions wanted a vehicle to capture new business. They found it by buying and expanding chains of estate agents. To feed the growth, longer hours and six-day weeks became the norm. I was one of those drone negotiators working six days a week, 9-to-8, with a Wednesday off if I hit my targets.
Yes, I sold a lot of property and I also learnt that a driven sales force working a huge amount of hours can service a lot of people, but that was in an age where my tools of the trade were a desk, a landline phone and a plastic applicant box with cardboard applicant card…this was long before CRMs, property portals or the internet.
Unfortunately, many agencies in 2022 still have this outdated “work hard, work long” DNA baked into their sales and lettings operations, mainly as they’re seniors, typically my age, from a generation when doing extra hours means better cash flow. It also means a 40% churn of people in the business, however, where still an average property practitioner is only 23 years old.
I am lucky. My day job for the last six years has been to meet people and learn about what they do. Over 600 property technology and fintech founders are digitally building to help those doing real estate. They are not looking to replace humans, but they are looking to use software to remove the mind-numbing operations that take hours out of the day.
They make businesses more efficient.
With cloud computing scaling up nearly two decades ago, and new technologies being utilised daily, we must acknowledge that we live in a world where service is even more sought after, and humans alone, however many hours they work, can not look after the nano-second needs of the digital natives who run their lives through their smartphones.
If agencies want to retain great talent and grow, instead of spending huge resources on employing a smaller and smaller pool of new people, then embracing the idea of a 20% shorter working week aided by useful digital hand tools must be the way forward.
The Guild: Property market remains robust
Much has been spoken about the potential impact of the economic headwind; however, the property market continues to be brisk as the imbalance of supply and demand continues to underpin market activity. This is according to Iain McKenzie, CEO of The Guild of Property Professionals, who notes that buyer enquiries are up 31% compared to the last ‘normal’ market in 2019. “We continue to find ourselves in a market where mortgage approvals and sales are up, but there is half as many properties available to buy, and according to Rightmove, stock levels are down 55%. This prolonged mismatch between demand and supply continues push housing prices up,” he adds.
McKenzie says that on average properties are selling subject to contract in just 31 days, the quickest time ever recorded. “Competition for properties is fierce, which means homes are selling quickly and often for over asking price. In fact, Rightmove reports show that asking prices have hit their fourth consecutive record high in as many months,” he comments.
According to HMRC, over 433,000 homes in the UK changed hands in the first four months of 2022, making it the third busiest start to a year since 2007. Last year was an exceptional year due to Covid-19 and 2016 saw a surge prior to the introduction of the 3% additional homes surcharge. Except for last year, April 2022 has been the busiest since 2007.
While demand is high, and the market is brisk, economic headwinds are mounting and this will filter through to the property market. “Expectations of global and UK economic growth have been pared back, while consumer confidence has plummeted to its lowest level since records began in 1974. Optimism is weaker than during the global financial crisis, Brexit or Covid-19. The Covid recovery, war in Ukraine and rising energy and food prices, alongside a strong labour market and low unemployment have created a perfect storm. Inflation is pushing a 40-year high. Thanks to fixed-rate mortgages, many households are cushioned from the impact of the latest base rate rise, but day-to-day budgets are increasingly feeling the squeeze. These growing pressures will no doubt have an impact on the market, and it is likely that we will start it begin to moderate. Unlike the rapid emergency brake scenario seen during the global financial crisis in 2008, any gear change in the property market is liable to be slow and steady,” says McKenzie.
Even with the economic pressures, forecasters anticipate that we will continue to see positive house price growth over the course of the year. “The average price of a home is now nearly £47,000 more than in March 2020. This compares to a rise of less than £9,000 in the two years previously. Month-on-month price growth continues across nearly all regions of the UK, all the main property price indices indicating the annual rate of price growth remains firmly in positive territory. The average price of a property now equates to over eight times current average annual earnings. With earnings growth failing to keep pace with property price rises and cost of living increases, the relative affordability of property is rising up the agenda,” McKenzie concludes.
Press Release: Satellite Vu partners with Landmark to provide vital climate change data to the UK land and property sector
London, June 7th – Satellite Vu, the UK satellite firm set to become the world’s thermometer from space, has partnered with Landmark Information Group to provide vital climate data to the real estate market.
The partnership will see Satellite Vu provide data from their thermal infrared satellites to Landmark, a leading provider of data to the UK land and property sector, to distribute to businesses as part of the global push towards Net Zero.
The Intergovernmental Panel on Climate Change’s (IPCC) report re-affirmed the global aim to reduce carbon emissions by 50 per cent by 2030 and achieve Net Zero by 2050, serving as a call to action for governments and businesses across the world.
The collaboration between Satellite Vu and Landmark will see the joint development of geospatial information products for the UK real estate market pertaining to the thermal efficiency of buildings monitored by Satellite Vu’s thermal infrared satellites and aerial imagery.
This data will be distributed across Landmark’s customer network to test, validate and market the geospatial information products.
Satellite Vu has recently announced a launch deal with Elon Musk’s SpaceX, which will see the first of their constellation of heat sensing satellites launched into orbit aboard a Falcon 9 rocket in early 2023.
Anthony Baker, CEO of Satellite Vu, said:
“The urgency for action to reduce the world’s carbon emissions is increasing every day, as highlighted by the IPCC, and therefore businesses need to utilise all resources at their disposal.
“We are thrilled to have formally signed an agreement with Landmark to introduce data from our thermal monitoring satellites to the real estate sector. The insights from our satellites will enable investors, property developers and building owners to receive regular assessment of their buildings’ energy efficiency, allowing them to measure, validate and improve energy efficiency. Armed with this capability, businesses can take concrete and independently verifiable action to align their business with national and international energy targets.”
Simon Brown, CEO of Landmark Information Group said:
“Climate risks and environmental factors are playing an ever more important role in future planning, purchasing and lending decisions. It is vital that as an industry we take steps to understand those risks, not only to future proof the housing market but to ensure that we are all contributing to achieving net zero.
Satellite Vu’s technology combined with our expertise in property data and risk modelling will mean we can provide the industry with a more informed view of future risks for the UK property portfolio. These more accurate datasets will guide businesses through their property investment decisions, mitigate risks and ultimately support our environmental ambitions.”
Press Release: 92% of Landlords Believe Employees Want More From Their Buildings – And They’re Prepared to Deliver
Landlords investing in tenant experience teams and tech-based communication tools
Fresh off the heels of HqO’s survey of corporate employers, we’re pleased to release key findings from our commissioned survey of select international landlords, all of which have at least 1M square feet of commercial real estate property.
The top-line takeaways? Overall, today’s landlords are optimistic. Only 20% think demand will decline over the long-term. But, they also agree that employees want more from their buildings (92%).
Where Landlords and Tenants Meet
In our 2022 Tenant Engagement Report from earlier this year, we heard that most businesses were adopting hybrid work models, reducing their overall commercial real estate (CRE) footprint. Today’s results corroborate those findings. Only 48% of landlords surveyed say at least 75% of their office space is currently leased. Moreover, only 24% of landlords say they experience greater than 75% daily utilization of their leased spaces.
In contrast, if one were to look at the market at large, it shows the demand for marquee or specialty space remains high. Leaders such as Salesforce, Apple, and Google are investing heavily in space, even as they have reduced the amount of time or eliminated the requirement for employees to physically come to the office altogether. Perhaps, as a result, surveyed landlords are working to increase the flexibility, usability, and appeal of their spaces through targeted strategies.
Those surveyed are taking proactive steps to align with — and attract — tenants and address any shortfalls.
Investments, Support, and Communication Advancements are Priority
To succeed, landlords know they must form deeper and less transactional relationships with their tenants and drive collaboration across their strategies and business initiatives, while improving maintenance processes and pricing, as well as offering better in-office experiences.
All surveyed landlords are involved in their tenants’ long-term real estate plans through close collaboration, ongoing joint meetings, or ad hoc communications. However, weekly, monthly, or short-term communications are limited. Landlords plan to address these communication gaps via technology sooner rather than later. Overall, investments in tenant experience technologies are set to increase or remain the same, with an isolated few suggesting a reduction.
To manage more frequent and meaningful communications, landlords are also investing in enhanced experience teams to meet the varying needs of their tenants:
- Nearly 90% of landlords are planning to provide dedicated tenant experience staff, or already do.
- 40% of landlords see these tenant experience leaders as primary decision-makers, with a further 40% regarding them as influencers. In context, this gives experience teams more responsibility than asset or portfolio managers.
These tenant experience leaders are helping to deliver on stated areas of interest from tenants, such as reservation tools for desks and parking, food and beverage ordering services, visitor management and access control, maintenance tools, and energy monitoring technologies. In fact, a full 80% of landlords believe that tenants are keenly interested in comprehensive building mobile applications. As such, experience teams are rolling out digital amenities to complement the physical amenities that tenants have become accustomed to to help reduce even more workplace friction.
By investing in people, technology, and time, landlords are poised to meet their tenants where they are, and cement these relationships for the long haul.
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