Tuesday, 11 June 2013

The rumblings beneath us - The Crossrail Effect

There's a silent change occurring across London that has the potential to have a significant impact on London life and the property market. Given the go-ahead in 2008, Crossrail is one of the largest transport infrastructure projects that many of us will see in a lifetime. Creating new underground links across London from Maidenhead in the west to Shenfield and Abbeywood in the East, the new line will revolutionise the commute to work for many increasing the London's transport capacity by 10%, as well as creating new property hot-spots across London. 

Back in 2008, many cynics would have dismissed Crossrail as a project too big for us to handle, which would ultimately fall foul of political or financial issues. However, 5 years on, if you take a walk around London, the landscape is changing. Huge areas around Canary Wharf, Liverpool Street, Moorgate, Farringdon, Tottenham Court Road, Bond Street and Paddington are changing under our noses. This project is all of a sudden becoming real. 

Crossrail work at Canary Wharf Station - Courtesy of http://www.bbc.co.uk/news/uk-england-london-20933396

The impact on property prices in the areas affected has also become real. According to Knight Frank, property prices in areas within a 10 minute walk of Crossrail stations have increased by 30% since 2008, and in some areas will increase by up to a further 43% by 2018 when Crossrail opens. 

London residential property prices are already forecast to continue growing strongly in the next 5 years, however properties in the vicinity of Crossrail stations are likely to see increased growth. This is due to the reduced commuting times but also the improving infrastructure in the surrounding areas. Some of the new stations will be completed prior to 2016 and Crossrail is developing circa 3 million sq ft of office, retail and residential space across London according to Knight Frank. New residents, businesses and visitors will be coming into areas previously blighted by a lack of regeneration, creating positive investment credentials. 

Recently we have been working with clients to identify investment opportunities in areas of  London, directly on to the Crossrail network or linked to it via the London overground or underground network. Areas such as Whitechapel, Farringdon and Canary Wharf are areas where we believe there will be further significant growth in the next 5 years as rental demand increases and more households look to buy in these areas. A report for Crossrail prepared by GVA, forecasts that there would be £5.5bn of added value to the property market between 2012 and 2021 as a result of Crossrail. The matrix below highlights some of the areas that are likely to be most impacted by value change. 

Source: GVA - Crossrail Property Impact Study - October 2012

For more information on Crossrail go to www.crossrail.co.uk. You can read Knight Frank's May 2013 report here and GVA's Crossrail Property Impact Study here. If you'd like to chat to us about our work for property investors, please do get in touch. 

Wednesday, 22 May 2013

People Power

I am a firm believer that property is all about people and places. Aside from the macroeconomic factors that affect the housing market, micro factors such as location specifics and demographics also affect prices considerably. An area's desirability is often driven by the movement of people and changing lifestyle trends, which in turn will drive price movements.

As Londoners are being priced out of certain areas of the Capital as their property needs change, many are moving to unfamiliar areas. This is nothing new, but the interesting change is that whilst 20 years ago many Londoners would opt to move to commuter towns around the M25, today's London professionals wants to remain firmly within the city limits.

It's not just affordability that has swayed decisions in the past, often a need to accommodate a growing family, access to better schooling or the desire for more open space has driven decisions to move past the M25 and embark on making new 'train buddies'.

However, London has evolved in the past 20 years and many now actively see the benefits in developing their roots in the city. Improving transport infrastructure, more schools, increasing preservation of green areas and developing housing stock are all tangible reasons for people opting to stay in he Capital. Intangibly, the desire for a better work/life balance, increasing flexibility in working hours and a wider awareness of the green agenda are meaning many professionals are seeking a shorter commute to work.

So, you need a bigger home, preferably a house, you'd like a garden (or at least some outside space) and you want a shorter commute so you can spend more time seeing the family grow up. Where do you look?

Areas such as Dulwich, Camberwell, Herne Hill, Lee, Deptford, Hackney, Dalston, and Stoke Newington are starting to increase in popularity with young families as they provide quick access to central London and have a good stock of family houses in the area. These areas are also developing as social destinations, with boutiques and eateries becoming commonplace, complimented by access to green space. What the above areas all have in common is that they all have no tube stations, but central London can be accessed in less than 30 minutes by overground train, bus or bike. All these areas also trade at a discount to counterparts with tube connectivity.

It may be obvious by now, but you will have to make compromises and be a little bit brave, however over time you could be making a very wise economic decision. Needless to say, there are other pockets around London where one could look, but these are more prevalent due to south east London's lack of underground infrastructure.

It's not just families looking for value that should consider these points. Investors looking to speculate over the longer term or enhance their return through a mixture of income and capital growth, should see these as attractive investment reasoning.

On another note, preparations for our Australian business are gaining momentum and we are looking forward to opening later this year. Writing this from a rather fresh feeling London, I think that some development trips down under will be in order sooner rather than later!

Wednesday, 8 May 2013

Managing your investment - the gross to net effect.

With property investment, people always talk about yield, but what exactly is this? Detailed valuation models will often analyse an initial yield, reversionary yield, equivalent yield or equated yield among others. To most outside of the property industry this will look a bit like double-Dutch and their individual relevance can be subjective. 

Most investors in residential property talk about income yield, which crudely is annual rent divided by price. I say crudely, because often this calculation can be misleading and actually hide a poor performing asset. If you are looking at income yield on a residential property investment, you want the net figure and not the gross. The net figure is derived by subtracting your costs for that specific property (e.g. management, repairs, taxes). Some analysts will argue that you shouldn't include financing (mortgage repayments) but doing so will give you a real idea of performance. 

Not including finance costs, it has been said the average gross to net for residential property investments is 65%. So, based on a gross yield of 5%, your net yield including finance costs will be 3.25%. Now, take into account financing and your returns are further eroded, in some cases income may not cover costs. 

Why would any investor run a negative cash flow? In some countries there can be tax benefits for doing so, but more often than not it is because the investor believes that the price of the property will increase at such a rate whereby the gains from a sale at a point in the future would be significant enough to mitigate a negative cash flow over a period of time. 

This is highly speculative many would argue, and it goes without saying this would only work in a rising market. Essentially, total return of an investment is a combination of income return and capital return (price movements). 

What about if you're a long term investor and not looking to sell anytime in the future?  This is where managing your gross to net becomes important. 

If you have a property manager, make sure they are providing you with value. Property management fees can range from 5% to 20% of the rent received, which can be significant sums of money, so make sure they justify that fee. When undertaking works, sometimes the cheapest option is not necessarily the best and could mean you incur future costs due to poor quality materials or workmanship. Boilers are a good example, cheaper boilers have a shorter shelf life than the more expensive equivalent, therefore over a 5 year period you may spend more on repairs than if you'd gone for the dearer option. 

It's also important to know your competition. Landlords should make sure their property is the best of the competition so void periods are minimised. This is where many investors lose money because they don't spend the time or money on differentiating the quality of their product. Again, know your demand and beware that you don't go overboard, a pig in lipstick is still a pig. 

If you're thinking of investing, often it doesn't hurt to take some advice. Having a plan and knowing your market will prevent nasty surprises but will also ensure you can take advantage of any future opportunities that may present themselves. 

On an unrelated note, look out for our article in this month's editions of the 'Your Media London' luxury lifestyle magazines and our ad in 'The Resident' and 'Mayfair Resident' distributed across London. 

Wednesday, 1 May 2013

Behold the leasehold.

London's ever increasing population and finite supply of development land has meant that the city is one of the most densely populated cities in the developed world. As such property has always had to adapt, as in any highly populated urban area. 

The sight of apartment developments are often a sign you are entering the bustling city. The creation of apartment buildings has allowed multiple residences to occupy the same plot for decades, thus going some way to solving housing issues that affect major cities. 

However many are not aware of the differences in buying an apartment versus purchasing a house. Many see the apartment marketed as leasehold, but this doesn't often sound the alarm bells that it should. 

Ultimately in the UK, the Crown (The Queen) owns all the land. Therefore the closest thing to real ownership for us mere mortals is a freehold, which is the ownership of 'real property'. Freehold is the common title for property ownership in the UK. Essentially the estate must be immobile and ownership must be for an 'indeterminate duration' i.e. no fixed end date. For those purchasing land or a house on the plot of land it is more than likely you will purchasing freehold. 

What about if you're buying an apartment on the 5th floor of a new development, or a flat within a converted period mansion building? Well it's likely you will be purchasing a leasehold title. But what does this mean? It means that your ownership has a fixed end date, at which point your possession will revert to the freeholder, and also you will be bound by the terms of the lease agreement. 

So why should you be aware? Leaseholds are essentially diminishing assets, so as time goes on and the lease term gets shorter, it is worth less. You might own an apartment in a block of identical units. The apartment next to you has a lease term of 125 years and just sold for £500k. Your apartment though, has a lease term of 50 years, is it worth £500k too? Unlikely.

What about the lease terms? As with any legal document, reading and understanding the terms is imperative. Key things to look for are ground rent, service charge processes, restrictive terms with regard to refurbishments, restrictive use terms and hidden costs amongst others. 

A recent example we have seen is a ground floor apartment in a converted  period house purchased on a leasehold title, whereby the purchasers wanted to extend the property to add value. Once they had purchased the property, they found that a restrictive clause in their lease did not allow them to do this and as such they have not been able to execute their plan. If they had read and understood the lease agreement, it may have been that they would have altered their pricing or chosen another property altogether. 

In London it is near enough impossible to avoid purchasing leasehold unless you have several million pounds at your disposal, so the key is to get as much information as possible and make it relevant to you. Those buying in new developments will often be purchasing a 125 year lease or in some cases a 999 year lease, so you won't be worrying about a renewal for a while.  

Other forms of title include share of freehold and commonhold, but as with anything the devil is in the detail, so have an expert on your side when assessing the documents. Make sure you are comfortable with the ground rent costs and service charge fees, and beware these are can be lumpy. 

On an unrelated note, London has been a wonderful place to be in the last few weeks as we've been graced with intermittent days of glorious sunshine. You can tell it everybody is worried it won't last as every outdoor dining table, park bench or patch of sun drenched grass is filled by about midday, even on a Monday. 

Wednesday, 24 April 2013

A view from down under.

One of the unique things about our business is our intention to be a global firm acting in local markets. As such, we are excited that our Sydney office will be opening later in 2013, further giving us that global edge. 

In keeping with the Australian theme, this week's blog has been prepared by Pete Wargent, Director of the AllenWargent Sydney office, giving an overview of the key themes in the Sydney property market. Going forward we will continue to mix things up and we hope you find it of interest. 

After 18 months of steady corrections, and the national market falling by around 7% from peak to trough, the Australian property market turned around in May 2012.

In response to a series of interest rate cuts, the cash rate being cut from 4.75% to just 3.00%, prices have rebounded in all of Australia’s capital cities as confidence returned to the markets.

Interestingly, while prices remain below their 2010 peaks in all other capital cities, Sydney has now recovered all of its lost ground and all four major data providers show that Sydney’s prices are forging onto new highs due to very high demand.

Price growth

While data providers always show slight differences quarter-on-quarter, the trend is clear and that is that property prices in Sydney are set to increase.

In particular, RP Data notes that the major price growth has been driven by the broad middle market.

While the top 20% and the bottom 20% of the market respectively lag some way below their 2010 peaks, the popular properties close to the median prices are now 2.4% above their previous peak.

RP Data notes that apartment prices pushed on to new heights way back in June 2012.
Auction clearance rates in Sydney, which are usually a good indicator of future price growth have stormed upwards over the past 12 months, dwarfing those of every other Australian city.

Sydney’s regenerating Inner West has consistently shown auction clearance rates of 80-85%, while the most recent data has shown a strong resurgence of both homebuyers and investors in the traditionally popular City & East.

Population growth

The Australian Bureau of Statistics released its latest population figures for the year to September 2012, and the data showed that Australia’s phenomenal population growth is actually increased.

The number of persons increased by some 382,500 people over the 12 month period, of which the majority of the immigrants heading to only four places: Melbourne, Perth, South-East Queensland and Sydney.

The great population growth as ever will be concentrated on these four populous states, and Sydney will record further growth of around 60,000 persons.

Supply constraints

Vacancy rates in Sydney are very tight at below 1.5%, and in certain supply-constrained inner- and middle-ring suburbs, there is a dire shortage of dwellings.

The city recently announced drastic measures to build nearly 200,000 new dwellings over coming years to meet the exploding demand.

Unfortunately, Australia continues to suffer from widespread ‘NIMBYism’ and the proposals to build more new developments are already meeting roadblocks.

With the sprawl of Sydney constrained by the ocean to the east and National Parks at each of its outer fringes, the price of land looks set to continue to increase dramatically.

As the Sydney Morning Herald, summarised in March 2013: ‘If this plan doesn’t work, we really are stuck as a city’.


With inflation remaining benign, unemployment relatively low but creeping up and the almighty decade-long mining construction boom finally reaching its peak, most observers (and the futures markets) expect Australia’s cash rate to fall to a record low 2.75% during 2013.

The Reserve Bank desperately needs to stimulate dwelling construction to meet the accelerating demand, and so it looks to have little choice with regards to its monetary policy stance.

With investors already flooding the market – the average Sydney apartment is now being sold in just 32 days – economists believe that property prices may jump 10-15% higher spurred on by the stimulatory level of the cash rate.

Sydney looks to be the city where the gains will be focussed.

Wednesday, 17 April 2013

Driven round the bend.

As any seasoned Londoner will know, if you want to get any where fast, don't drive. Driving in the capital takes patience, cash and a fairly flexible schedule. You need patience to navigate the traffic and deal with the odd rogue cyclist, you need cash to pay the congestion charge and parking costs, and you'll need the flexible diary because ultimately you will get stuck in gridlock or end up parking half a mile from your meeting. 

London is gradually evolving into a city less reliant on the motor vehicle. Investment into improving public transport infrastructure, the expansion of the 'Boris Bike' cycle hire scheme and the fruition of car sharing schemes across the capital are giving households more reasons not to own a car. The increasing cost of fuel and insurance has also led to households seeking alternative forms of transport across the capital. 

Making car ownership more expensive and improving transport infrastructure is also part of a wider 'green' plan for London to increase air quality and create a sustainable environment for Londoners and visitors. This is also reflected in planning policy which has drastically reduced the number of parking spaces allowed for new developments. New residential and commercial developments, especially those in Underground Zones 1 & 2 are likely to have limited parking and in some cases, no parking whatsoever. Through so called 'Planning Gain' (terms and conditions of planning permission being granted) developers will often have to make contributions to or facilitate local transport infrastructure to improve the quality of the surrounding environment. 

So, what if you like cars, you own a car, and you want to use your car in the capital? Fair enough, you'll need a parking space. 

In many London boroughs, on street parking can be obtained after some form filling at the local council office, but that doesn't guarantee you a space on your doorstep (or even on your street). Also, do you really want to leave your new motor in full grasp of the wondering cyclist or driver with a limited spacial awareness? 

Parking in the capital is a premium, but everything has it's price. That's why there is a bustling market for parking spaces across the capital, from central underground car parks to secluded mews garages, there will also be a home for your car. Last year a double garage in Knightsbridge (pictured below) apparently sold for over £500k. If you want something less personal, Foxtons is currently marketing this space on Park Lane for £87,000 on a 99 year lease, a relative bargain. 

If this all seems like hard work, a super car club may be more tailored to your needs. Why not get the new Ferrari 458 Italia or Aston Martin Rapide delivered to your home or office, then give it back when you're done. Established clubs such as P1 and Ecurie250 are worth a look if this is more you. 

Wednesday, 10 April 2013

Making money work for you.

I discovered a few years ago standing at the bar of a brasserie in central Paris, that if I stood at the bar my beer would cost me €3, if I was sitting in the window it would be €4 and if I was sitting on the terrace it would be €5. It seemed bizarre that the same product could cost different amounts depending on where the buyer was placed. 

Well it's a similar story in the global property market of London. A domestic buyer paying Sterling for a property, could in essence be paying more or less than an international buyer who is converting their local currency into Sterling to purchase a property. The weakness of the pound in recent months has made UK property (in particular London) very attractive for investors looking to enhance their return with a currency strategy. 

Our spring edition of the Buyer's Eye talked about Singaporean and Australian buyers in particular paying over 10% less for London property over the past 5 years due to the strength of their respective currencies against the Pound. This was further reinforced by the latest research report from Hamptons International this week.

The on going noise about a triple dip recession and uncertainty regarding the UK's credit rating has undermined the Pound in 2013, resulting in a record low rate against the US Dollar in March. Not great if you've got a long weekend planned in New York soon, but interesting news if you're looking to buy UK property from a US Dollar source. The savvy buyer will also take time to look at forward currency contracts or limit orders to ensure that they benefit from the favourable rate for as long as possible and hedge the risk of a strengthening Pound. 

For overseas clients, we treat your currency strategy as a key part of the buying process therefore we work closely with foreign exchange brokers to ensure clients get the best and most appropriate advice. Take a look at who we work with here.

On social and charitable note, I am lucky enough to be involved with a new project called Pathways to Property: a Reading Real Estate Foundation initiative, supported by the Sutton Trust and British Land. The project is aimed at increasing diversity and awareness across the entire property industry, focusing in particular at the grassroots level by developing a summer school for 16-17 year olds looking for that next step. The vision is long-term but it's widely recognised that the industry needs to embrace change and that it will be better for it. I'll be regularly mentioning developments through our blog and social media feeds, so watch this space. 

Wednesday, 3 April 2013

April already?! A view on the last 3 months.

There is no official data out for Q1 2013 for a few weeks yet, but how has the first quarter of the year been for the London property market? 

The threat of a mansion tax, the introduction of the Annual Residential Property Tax on certain companies and other structures holding properties, London property prices rising, UK property prices falling... it can be quite confusing working out what has happened and where things will go from here. 

The mansion tax is the political hot potato of the moment and will probably remain so for the foreseeable future. Essentially, the coalition government doesn't seem to be able to agree a way forward: recognising the desire for a 'wealth tax' to appease the wider population, whilst being aware of the impracticalities and unpopularity among their core voters. One of the stronger arguments against any mansion tax is that it will tax those who have seen their assets rise in value over the years, however their disposable income would not cover such a tax. It is also considered that the tax would have a disproportionate effect on London, in comparison to other areas in the UK, due to the higher proportion of houses valued over £2m. 

The London market seemed to react in late 2012 to the political noise, with agents noting a significant fall in viewings for properties in the £2m to £5m price range. However, this was very much blown out of the water by the Land Registry figures in March highlighting that sales of properties above £2m were up 35% year on year in the capital. What does this mean? Well, it could mean something or nothing, as there are also many other factors influencing transaction numbers and house prices within a particular period. For now, it seems that the worry of an imminent mansion tax is cooling as parliament continues to remain in disagreement, and therefore one must make hay while the sun shines. 

The idea that nothing will happen at all is hopeful, but not very likely. Therefore, we can probably expect some sort of housing tax shake up in the near future. The loudest chatter seems to be referring to a revision of the council tax system, which is currently based on 1991 values, but there still remains the issue of a high number of people living in high value houses who wouldn't be able to afford the tax. So the way forward remains unclear. 

On the ground, in some areas of London it seemed there was a temporary stock shortage at the beginning of the year as vendors were assessing their next move and waiting until the end of the fiscal year (and bonus season). This didn't seem to affect purchasers however, so with the shortage of good stock and competition among agents, asking prices in the popular pockets of London have edged up further. This isn't necessarily true of all London areas, as the Capital is a web of diverse sub-markets, but certainly in the popular areas of Shoreditch and Battersea, this has been the case. 

Looking into the second quarter of the year, it's likely we will see more decisions being made by buyers and sellers, even if the government isn't able to do so. The continued weakness of the pound and Eurozone uncertainty also means London property will remain attractive to overseas buyers. Shrewd investors will try to price in political risk as much as possible, but in a fast moving market like London where competition amongst buyers is strong, sometimes you just have to get on with it: Carpe Diem. 

On another note, I didn't realise that people still played April fool's jokes until I was very much 'punked' this week. I received a note on Monday morning from a lawyer that we had breached copyright laws for our publication The Buyer's Eye (shameless plug - www.allenwargent.com) and action was imminent. I chose to react with surprise and disappointment as one would, only to learn it was an elaborate prank. The alarm bells should have been ringing upon receipt, we all know that lawyers don't work on a bank holiday. Needless to say, I learnt a valuable lesson and shall be seeking suitable revenge. 

Wednesday, 27 March 2013

London's bargain basket, surely not.

Recently during an interview with an Asian based investment magazine we were asked the following question: 
"Do the property developers just come to Asia to market all the properties the locals don't want?"
As a 12 year old music fanatic, every Monday I'd make a detour on the way home to visit Andy's Records (remember them?). At the back of the store in a dark corner sat the bargain basket, which was filled with all the music which obviously hadn't done too well in the charts that week. Everything was no more than 50 pence and I used to fish out a bargain once the hype of a particular release had died down. 

Why is this relevant you ask? Well, in the same sense, it would appear that some Asian investors are under the assumption they are the bargain basement customers for London property once the hype has died down. However, this is simply not so. Firstly, there aren't really that many bargains to be had, and secondly, they are often the first to be offered the chance to buy in a particular development. 

There are a number of drivers behind this, but a main factor is the changing way large developments are being financed. Before global finance markets took a tumble, development finance was readily available, if not also cheap, and developers took full advantage of this. It was therefore possible to build on a fully speculative basis and worry about sales later in the process. However, this all changed as finance markets contracted and debt became much harder to come by. If you did get offered debt, the interest rates and terms made your project near enough unprofitable. 

This is where the off plan sales became more prevalent. If a UK developer can secure a sale off plan to an Asian buyer, this is essentially a source of finance or the security needed to gain finance and allow the development to be built. No one likes risk, especially banks, so having a buyer already committed before a brick is laid reduces risk significantly. 

Therefore the Asian market is playing a much more important role than they probably realise. One would guess that has got to be a good bargaining position when buying, no?

See www.allenwargent.com for regular updates and our future press. 

On a different note, it's great to see how our relationships develop with some clients as we go through the buying process. Last Tuesday evening, I received a text message from a highly valued client asking if I wanted to go for dinner. I politely declined as I was already at dinner with another client, and he promptly text back saying, "glad you are busy, that was actually meant for my girlfriend!" I hope she's not the jealous type. 

Wednesday, 20 March 2013

So much information, so little time.

Technology has moved on leaps and bounds in the last 10 years and access to free information for buyers is overwhelming. As a result, many homebuyers are able to use the internet to do their homework on their target area and arm themselves with an abundance of information in the comfort of their own home (or from the office...I won't tell anyone).

The crux of this is that every search engine user is a buying adviser. But are they? Can you really replace the human element and real relationships with a database to achieve the same goal? Many would argue that you can. Look at HMV, Comet, Woolworths: all victims of shifting consumer buying habits towards purchasing products online (amongst other things).

But property is different. No one property is really exactly the same as the next. As a result we are not always comparing like with like. Therefore each comparable piece of sales information should be evaluated on its merits, something which is not a simple process and it can be argued, one that needs human input.

We live in an age where information is power, however, with so much information available, how do we understand which information is 'good' and which is 'bad'? Internet based search engines for property are only as good as the information put into them at a certain point in time,  therefore a buying decision could be based on relevant or irrelevant information. It's a bit of a gamble. Information can also be selective. There is no obligation to disclose all positive and negative traits of a property on an internet listing, therefore are we truly comparing like with like?

How many hours do you think the average home buyer will spend on a property search engine before they purchase a property? Using conservative numbers: people will probably start looking 3 months before they buy and say they spend an hour a day (more like 2 hours), 4 days a week on a website (more like 7 days), and also continue this once they've found a property to make sure it's been removed and that nothing better comes on. Essentially you're talking about a minimum of 48 hours of your time (or your company's time) over a 3 month period before you've even done viewings, negotiations, sorted contracts and, even more importantly, sold your current house!

Some people just don't have this time to speculate and that is where a buying adviser provides value (shameless plug - sorry). Access to off market opportunities is also another element where internet databases won't give you an advantage in today's market. As a good historian will tell you with any research, it's always key to assess the credibility of sources and the relevance to your situation.

On another 'non-property note', one of the interesting elements of doing international business is always "the introduction". To kiss or not to kiss? After how many meetings is a handshake replaced with a kiss? Should it ever be replaced? If so, how many? In the UK, we have no real etiquette (ironically): it can be one or two. In Holland it's three, in Mauritius it's four. Then there's the dreaded awkwardness of the handshakekiss, one party goes for the handshake, the other for the cheek and you end up in some sort of Freemason like embrace. Needless to say, there is a lot more to learn when visiting other countries across the globe, so in this sense Google and Youtube can be your friend!

Wednesday, 13 March 2013

Who am I?

Welcome to the inaugural www.allenwargent.com blog, your portal into the fascinating world of property search. 

Who am I? (mimics Henry Kelly at the start of a 'Going for Gold' question). Property buying agent, property buyer's agent, property finder, relocation agent, buying advisor, buyer's representative...call us what you want, our industry has somewhat of an identity crisis. We're not estate agents as we don't sell or market property, but we are regulated by the Estate Agents Act 1979 and have to comply with the Anti Money Laundering regulations set out by the Office of Fair Trading. For the purposes of Professional Indemnity insurance we are also covered as estate agents to a large degree, but we still don't sell property. Confused? That's just the start of it. 

In the UK, we often don't consider using an agent or representative when buying property. Essentially estate agents marketing property are paid by the seller and thus have no contractual obligation to provide a buyer with a service. If they did have, there would obviously be a huge conflict of interest. Just as an estate agent will advise a seller on the right price and method to market their property, surely a buyer should also be advised the best price to pay for their new home or investment? An agent acting for the seller ultimately wants to get the best price for their client, so is that in the buyer's best interest?

Estate agents get a bad press more often than not, but there are more good ones than there are bad. Our bad experiences are often borne out of not having aligned interests, very common when you want an estate agent to do something for you as a buyer, when they are contracted to someone else, namely the vendor. Maybe it's worth considering having someone looking out for you? 

Perhaps that is where we come in, but who are we exactly? See www.allenwargent.com to learn more about us and the markets we work in.

Now for something away from property. One message that was reinforced to me this week in discussion with one of our clients is that successful people will often surround themselves with people who are better than them in an array of fields in order to keep on learning and evolving. Sounds simple, but often our own insecurities and/or egos can make us feel threatened by those who know more and thus we place a ceiling on what we can achieve. Kjell Nordstrom (www.kjellnordstrom.org), talks about the need for businesses to constantly evolve just to stand still and maintain success, so surrounding yourself with the best is not a bad way to achieve this.