Estate Agency - Is there a better way?
November 19th 1991 – “Black or White” by Michael Jackson was number 1 in the charts. “What about Bob?” was top film at the box office (no me neither). It was the week Freddie Mercury died and also the day that Bristol’s favourite letting agency opened its doors for the first time. Yes it was 25 years ago that Accommodation Unlimited began trading.
25 years ago there were little or no regulations covering rented property. Gas Safeties? Nope. Deposit schemes? Dream on. EPC’s? Don’t be silly. Now we have the imminent banning of tenant fees. As many of you will know this was covered in my email the day after the chancellor’s statement and I see no reason to go over it again except to say WTF!
This article is a positive one looking to the future. The rental market has changed immeasurably over the last 25 years. In 1991 there was no such thing as a buy to let mortgage. If you wanted to buy a property to rent out either you went cap in hand to your bank for a loan or applied to the Birmingham and Midshires Building Society - the only lender that looked at rental income.
In 1991 we were in the midst of a housing crash; Bradley Stoke was the capital of negative equity, the base rate was 10.375% (in 1989 it had been 14.875%) and renting property was seen as something slightly seedy with images of Rigsby from Rising Damp and Rachman still fresh in the mind. There were still registered rents and protected tenants, so what idiot would want to start a letting agency? Well this idiot actually. Because to quote our latest Nobel Laureate Bob Dylan: “The times they were a changing…..”
The 1988 Housing Act introduced the Assured Shorthold Tenancy which is without doubt the single most important event to happen to the lettings market in the last 50 years. The 1988 act reset the balance between landlords and tenants. The introduction of six month agreements, the right of landlords to give 2 months’ notice with a Section 21 notice made renting a property a viable option.
In 1991 if you were in negative equity and needed to move because of work, you suddenly had an alternative to putting the keys of your property through the door of your local building society and walking away. You could rent out the property, use the rent to pay the mortgage and wait out the storm. The stigma of renting was disappearing, it was no longer seen as a sign of failure to admit you rented, it was just something people did.
During the housing crash of the early 1990’s estate agents haemorrhaged money. As many faced bankruptcy they looked at other ways of generating cash flow and noticed that the one area of the property market doing very nicely was the rental market, so they opened lettings departments or if they already had a lettings department brought it out from the back of the office to the shopfront.
In 1992 ARLA was founded and now Letting Agents had credibility. Fast forward 25 years and there are now over 100 companies offering lettings in Bristol, the lettings department is no longer the poor relation of estate agency and buy to let is keeping estate agents in business, and this is where we come in.
Helping landlords to buy good investment properties
Many of you have looked to us to help you grow your buy to let by using our buy to let personal shopper service and I am very proud of the service we offer. However you will also know how disappointed I am with the service given by many (not all) estate agents. Lack of knowledge about the property, especially if it is already rented. Really how hard is it to find out what the current rent is? Over-estimating potential rent to get a sale agreed, failing to turn up for viewings because an offer was accepted and they didn’t think to inform us or our clients are just the tip of the iceberg.
Surely there is a better way?
Well actually we believe there is. Just as in 1991 I felt there was an opportunity in the lettings industry I feel now the time is right for us to open an estate agency, and so I am pleased to announce that from January 1st 2017, Accommodation Unlimited will have an estate agency as well as a letting agency.
We feel there is a gap in the market for a specialist agency selling buy to let properties for and to investors. What conventional agents forget is that buy to let properties are not just bricks and mortar, they are going concerns and should be sold as such. Specifically potential buy to let investors need to know answers to questions such as:
• What is the current rent?
• What rent increases have there been?
• How many voids there have been over the last three years?
• What maintenance costs there have been?
• What are the service charges?
• Is the property let furnished?
• How long the current tenants have been in situ and are they looking to stay?
I believe that by selling buy to let properties as going concerns, higher prices can be achieved as well as having fewer sales fall through. I also believe that by selling properties that we have previously let we can offer both purchasers and vendors a better service than what is currently offered by mainstream agents.
A final few words
My marketing advisor tells me that every blog needs a call to action, so here it is.
If you love working with us, as much as we do with you, and are looking to sell your buy to let property during 2017, then look no further than the new Accommodation Unlimited Estate Agency.
It will give you the same great service you’ve come to expect, backed by 25 years of experience within the Bristol Lettings market and if that is not persuasive enough then for all sole agency instructions we receive in the first three months of 2017 we will only charge 0.75% agency fee with no VAT.