Posted by & filed under Blog, Industry News, Opinion.

A reoccurring conversation I have had over the past 12 to 18 months is the candidate shortage within the Property market – especially in Sales. Why is it harder to find good people I am asked? What factors are affecting this?

There could be many external factors which could be influencing the market…

Firstly, unemployment is at an all-time low of 4.4% (REC) – this indicates that there are therefore fewer people to fill roles. As permanent placements remain stagnant – temporary and contract recruitment is increasing from 33% in March 2015 to 57% in March 2018 (REC).

Is it the uncertainty of Brexit? Inflation to live in London? Wages catching up with cost? Or are people’s ideologies changing?

I have worked within Property since 2012 working my way up to Head of Department in the Sales, Lettings & New Homes Division – during my time within the Sector – now is the time I have seen most unease.

Secondly, the Property Recruitment Market reflects the current Property market…

Property Market update

Several factors are blamed for poor Property Sales growth including “subdued economic activity” (the Mortgage Lender) – also household outgoings are higher which is affecting the demand. According to Cost of Living Survey (which ranks 209 cities globally for costliness) London has leapt from 29th to 19th in 2018.

Demand has dropped off, Jeremy Leaf states the number of £1m houses on Sales throughout London are at a record high – buyers are just walking away from the “ridiculous” prices. Rightmove shows in June 2018 there were nearly 20,000 houses and flats on for Sale – a record. Rightmove also disclosed there were 16.4% more London homes on the market compared with June 2017 with the number of Property Sales in the Capital are down by 5% in the past 12 months (The Independent).

The average house price in the Capital has increased by 500% in the past 20 years from £98,000 to £485,000 in January 2018 – compared to the £277,000 UK average (Property Week).

The Berkeley Group which builds luxury homes in London and the South East warned in a report that profits were likely to fall in 2018 by a third due the constant weight of Brexit uncertainty on the London housing market (The Berkeley Group).

On a positive note, Homes & Property state with the significant increases of the number of houses and flats on Sale in the Capital it gives buyers A LOT more options in comparison to previous years and if prices remain steady and wages increase this will see properties become more affordable.

When I first started at Cherry Pick People Recruitment in 2012 – candidates did not question the low basics and high commission however as the years have gone by and the Property and Property Recruitment Markets have changed rapidly – so has people’s ideologies.

The emphasis of the “work hard, play hard” mentality and working 70 hours a week have decreased in our candidates’ desires.

Perhaps the factors I discussed above have influenced – the current rate of unemployment at all time low in the UK, the inflation of household costs, mortgages and house prices add to the stresses of the 2018 worker – has the uncertainty of the Property market made the Property employee uncertain?

So, with this change, people seem to be far more focused on well-being, health, social time and less stress. We have seen that candidates our asking most about free weekends, benefits, less hours and higher basics.

I’m sure many of you who have been in the industry will feel you don’t want people with these types of drivers – “as they don’t make good sales people” but perhaps as society, how we buy, the markets change we need to change with then???

Posted by & filed under Opinion.

A report was released by Sheffield Hallam University on August the 1st that currently one third of private Landlords are cutting back on leasing to under 35’s due to the younger generation who are currently in unstable employment, universal credit or students. A separate piece of research by Housing Hand which shows the rising rents, household debt and poor credit is also making it harder for young people to secure accommodation. As a Property Recruiter which target market is largely focused on the younger generation with a massive proportion of roles being Graduate positions – this report did not only concern me, but the way houses are being used as assets rather than a home to people – morally worries me.

I understand to an extent the flip side, Landlords need to cover their backs and of course, they do not want a situation of rent arrears. My mother is a landlord so I can empathise with the latter – it can put the Landlord under huge financial pressure. RLA suggested instead of Landlords increasing their rents to make it unfordable, they are covering the ‘risks factors’. Which to some, may make sense.

Stating that the Property Market has been rocked in the past 18 months would be a huge understatement. Working in Property Recruitment for the past 5 years I have never seen more uncertainty– but is it this deleterious thinking that is adding to the negative effect. The Independent has recommended talks with the government to cover this decline (79%) of Landlords leasing to under 35s is needed ASAP – without action the younger generation will find it harder and harder to access any accommodation.

Alex Huntley, Head of Operations from Simple Landlords Insurance has suggested ways to overcome this with Landlords – interviewing tenants in person? Guarantors? Regular inspections of the property? Payment plans with tenants? Sheraz Dar chief exec of Credit Ladder suggests landlords should not be basing their decisions on gut feeling and pointed out that many young people can be better than the older are at organizing their finances.

So, what is the solution? I would say – is this effect on Landlords reverting back to the strict Buy to Let costs (I have discussed in previous blogs Is the Sales Market Doomed?) which are then translating to the negative impact on the Landlords thinking of who they would like to lease to? Something needs to be adjusted quickly – before Properties are not just a home or safe haven for people anymore, but just used an asset.

I would be keen to hear thoughts and opinions?

Posted by & filed under Industry News.

The past year of the London Property Sales Market has been very interesting, something I have constantly kept track of. I have worked within the Property Recruitment industry for almost 5 years and this past year has been particularly different to previous years!

In my last blog, So Happy My Offer Has Been Accepted! But Oh Wait, The Dreaded Stamp Duty… I discussed the effect the increased Stamp Duty was having on first-time buyers and the London property market and whether it was even an issue for the most affluent?

Is everyone moving from Zone 1? Is it a boycott of Prime Central London!? PCL has been a location desired by many, I personally have always aspired to live in areas such as Kensington, Notting Hill, and Chelsea – if I could afford to move to the beautiful South Kensington or calm Little Venice I definitely would. But has that Hot Spot changed for potential buyers? Is it now the purchasers that are filtering from the Centre to what was known before as the ‘dreaded’ Zones 3-6. The Evening Standard has stated the largest drop in property prices has been in the Central Boroughs such as Camden (down 16.4%) and Hammersmith & Fulham (down 11.6%). The borough with the most increased growth has been Hackney with an increase of 15.6% and Bromley (even further out I know) has had a rise of 11.6%.

Data firm LonRes have also stated the number of houses over £1m sold in 2016 were down 21% year on year. City A.M reported London’s house growth is level with Portsmouth… Hometrack has stated prices in PCL are just becoming unaffordable, in Chelsea house prices have fallen by 10%. Savills concurred that the prices of PCL have fallen by 6.9% compared with last year (which was 4.9%). However, the real estate firm has said within the collapse of Sales (Brexit and increased Stamp Duty) the asking prices of properties have had to reflect this. Is this all doom and gloom? It was predicted that the fall in PCL would be 9% – so it is actually less than anticipated.

(Source from Knight Frank)

Even though Savills have reported lower prices, Persimmon has stated a rise in revenue (their average selling price was up by 4%) as the availability of mortgages have helped to boost prices!

More and more buyers are now buying New Homes which seems to be a strong choice for buyers.  New Homes are competitive with mortgage offers and therefore makes the purchase very affordable (I recently bought a new home myself!). The FTSE 100 in January showed the builder was the best performer with share up by 5%.

Richard Donnell of LonRes has shared that house prices in London are 85% higher than they were in 2009!!! – so it is not surprising the pace has decreased. Helen Cahill of City A.M has said the slump in the prices are at the top end due to Stamp Duty on homes worth more than £1m and has meant that some homes have slashed their prices by 30% – it is all to do with affordability. Are buyers simply not able to physically pay the price for PCL?

But will it all be over soon?        

Or will it be a case of Zone 1 buyers fleeing to the likes of Bromley? Or the up and coming Hackney? As the Sales Market changes so do consumers.

Posted by & filed under Blog, Cherry Pick People News, Industry News, Opinion, Uncategorised.

So happy my offer has been accepted?  But oh WAIT, the dreaded stamp duty…

The Times recently stated, “Stamp duty only used to be paid by the wealthy property buyers but now it makes younger buyers poorer”.

As promised, here is an update on my last blog – the sales market is it doomed? I started the process of buying my first ever home in London.

To give you an update – I have had an offer accepted on an amazing property in my perfect location! So happy! But the excitement flattened, as a first-time buyer I was shocked in the increased stamp duty to 5%. I sat there – looked over all the figures – How do they expect first-time buyers to save for a deposit, pay the mortgage and solicitor’s fees as well as pay a hefty stamp duty? Naomi Heaton (CEO of a Property Investment firm in PCL) has said the fall in home sales is ‘very concerning given additional government schemes for first-time buyers’. The Guardian have also blamed the huge rise in stamp duty as London home sales fall by 40 per cent!

The Telegraph has stated that stamp duty is not actually helping first-time buyers – an example was shown of a married couple trying to buy in Brixton, found their dream home at £345,000, offer accepted but did not budget for the stamp duty and had to pull out due to an additional £10,350 for stamp duty that they could not find the money for! Contradicting the latter, Marsh & Parsons have stated that home purchases have increased from 22% to 34%, according to data collected from buyers across all Prime London. The FT have also said the 3% rise in stamp duty for private landlords has scared off buy-to-let purchases which have given a larger market to just regular buyers.

According to the Land Registry in 2016 we have seen that the huge rise in stamp duty is blamed for London’s sales falling by 40% with the average stamp duty at a whopping £16,500 – even more so in Central London with a 60% fall (only 62 properties were sold in Central London in 3 months!). Comparethemarket.com has shown that a third of people are choosing to renovate their homes instead of selling/ moving. I had this experience a few times whilst looking – viewings booked, properties had already decreased their prices by 20-30% and then the seller decides to not sell!

However, if we scrapped the stamp duty – what would happen to house prices?! Of course in logical thinking, bringing more people into the property market without increasing supply is likely to push prices up? It has also been suggested by Yorkshire Building Society, that Stamp Duty should be paid by the house sellers rather than the buyers to remove the burden of money so that younger generations who are struggling can actually get on the property ladder earlier in life!

So, what are you thoughts? Should the stamp duty be paid by the sellers? Should it be different for first-time buyers? Or has the increase actually helped the property sales market?  I’m interested in your thoughts on this.

Posted by & filed under Blog, Opinion.

Doom and gloom have risen over the property market in the past months, especially focusing on the estate agency sales market. A question that is frequently asked of me is “Surely Lettings is doing a lot better than Sales isn’t it?”. But is it? I believe it is all a scare/ shock tactic of the EU referendum. As a first time buyer looking to purchase a property in South West London, I have had conflicting advice. I either hear “NO – do not buy now just after Brexit, bad idea WAIT” or “Yes April, it is a perfect time to buy, mortgages are at an all-time low!”.

So what is the truth?

What is the estate agency sales market currently like – behind all the façade of the UK exiting Europe?

I have researched this vastly for the past week, in property news, and speaking with brokers, Sales Managers, Sales Directors and various other estate agency professionals. It is clear that uncertainty shook the Sales Market after Brexit. The Guardian stated uncertainty of the EU Referendum drove the largest fall in people trying to buy a property since the Financial Crisis. The Institution of Chartered Surveyors (RICs) has also suggested the number of homes for Sale has declined more rapidly than at any other time since they started gathering information in April 1999! (Rics) have also stated that at least 1.8m more households will be looking to rent rather than buy a home by 2025. This has been proven by tenancies also increasing from 2.3m in 2001 to 5.4m in 2014. House prices in London are the second-most over-valued of all the world’s major cities, according to investment bank UBS.

The Guardians research, however, contradicts with figures showing the Brexit vote in June has not collapsed all consumer confidence which was so feared – Christen Lagarde stated prior to the EU Vote, that voting to Leave would lead to a crash in house prices. Whereas house prices have grown in September, and August by 0.3% and 0.6% according to their research.

Deutsche Bank analyst Reiff and Scheulfer made a huge case (over 70 pages worth) arguing that for any investor the economics in the London Property Sales market have been HAMMERED according to the FT times. The analyst’s state three main things to prove this fall – the tax deductions in 2015 have been restricted for higher income buy-to-let landlord’s. Secondly, increased stamp duty on buy-to-let and second homes, lastly changed the way landlords report their income, forcing them to register their gross rental income rather than the net income.

Facts, figures, stats and everything shown – People will still always buy in London, it is one of the most sort out cities in the word (even though it may be one of the most overvalued…). It will always be somewhere we (well me), will want to buy in.

What do you think? Is the Sales property market REALLY doomed? Or will it get back to normal as some facts have shown?…

I will keep you updated with my first time buying process.

Posted by & filed under Advice, Opinion, Uncategorised.

 

It’s interesting when I meet with my property clients as they often explain what they don’t like about using recruiters and why lazy recruiters are a problem. Very often they say it’s people throwing irrelevant CVs at them or meeting inappropriate candidates and wasting their time.

It’s also interesting  when candidates say they have spoken to recruiters and have 3 interviews lined up with various different estate agents – having never met the recruiter. Then once I have met the candidate I have no idea why they were put forward to those companies, it might be that they don’t fit the brand, aren’t qualified or just won’t fit in with the team.

At Cherry Pick People we spend a lot of time making sure we find the right opportunity for our candidate’s and the right candidate for our clients. As I’m sure you’re aware, finding the right candidate is not an easy task. If it were I’d be out of a job. The right candidate isn’t just someone with a good CV it’s so much more than that which is why I believe all good recruiters should meet their candidates.

Every company is different and has something unique to them whether it be the way in which they operate, the culture, or their brand, and whether someone is going to be suitable can only truly be ascertained upon a face to face meeting. Particularly in the estate agency industry where personality is so important. I often meet sales and Lettings Negotiators with lots of estate agency experience thinking they’re going to be a fantastic candidate for my client but upon meeting them I quickly realise that they’re not the right fit at all.  This stops my client wasting their time interviewing the wrong people and stops my candidate wasting their time seeing the wrong companies.

I think lazy recruitment is becoming a problem within our industry and is taking away some of the hard work and effort we do as recruiters. After all, I provide sales and lettings negotiators who make in some cases huge amounts of money for estate agents so the difference between the right candidate and not the right candidate might mean you make an extra £100,000 revenue at the end of the year.

If you are looking to recruit a sales or lettings negotiator or looking to get into estate agency, start here with Cherry Pick People – we will do our best to find you the RIGHT candidate or RIGHT opportunity.