It has been a challenging market for the residential lettings industry in recent times, with rents dropping for the first time in six years in the first quarter of this year. It has been suggested that this was down to the pandemonium created late year, with many landlords rushing to buy before the stamp duty surcharge came into play, this has caused an influx of properties available to rent. It has also been reported that there was a drop in the number of tenants registering, which obviously had an effect too.

I’ve spoken to many of my clients here in South London about this over the past few months as despite this they have achieved record figures. When I pressed them for more information as to how they had achieved these record months, they attributed this to taking the change in the market as a positive opportunity to hone their skillset rather than focussing on the doom and gloom that has been portrayed in the media. They said that they had taken the time to invest in training and development and employees were learning more about their vendors, applicants/tenants and the market in general. In turn they have passed the benefits on to their clients by educating them on market conditions thus allowing them to offer a more bespoke, knowledgeable and trusted service.

When asked about the future for residential lettings there was a common theme that seemed to crop up, which is the abolition of lettings fees. There is definitely a concern in industry in regards to this, as many see this as a significant challenge in months to come. The fees are being scrapped but in reality they are not, the referencing still needs to be done, the inventory need to be undertaken etc, these jobs do not cease to exist because the fees have been abolished.

The bulk of these fees will no doubt be passed on indirectly to the landlords, by passing these fees onto the landlord the concern is that this will cause landlords to shop around more than ever, thus meaning that there will also be pressure on residential lettings agents to keep their agency fees competitive, and in order to do this they will have to absorb a portion of the fees. This will put a squeeze on income for estate agents as they will have less money coming in and as mentioned before the residential lettings support staff will still need to be paid. Rents will no doubt rise also due to the increased agency fees, which could also lead to an increase in landlords renting privately, which will lead to added pressure on the lettings agents.

Yes, the next few months will be a difficult few months, however now more than ever, continuing to educate landlords on the market conditions and the significant role that residential lettings support staff play is important. As after the initial knock on effects, which will no doubt cause landlord to shop around based on fee, we should then begin to shift move back toward service again.

Only time will tell but the one certainty is, we have seen difficult markets before and we will see them again, estate agency has always survived as people will always need a roof over their heads.

What is your take on the future of the industry?

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?

Why I love Estate Agency Property in South London.

Ever since moving to London I have lived and worked in South London, I have become one of those people who shudder at the thought of “crossing the river”.
South London is a fantastic part of London to work in, especially for Estate Agency, the average house price over the years has risen dramatically. Looking at past figures, the average house price in the borough of Greenwich has risen by 480% from £47,655 to £382,874, the borough of Wandsworth has risen by 556% from £114,179 to £624,212 and the borough of Lambeth 639% from £47,059 to £538,477.

With 1 in 3 people renting their homes, there is a great mix of diversity and culture, it certainly is a vibrant place to be.

There are also the huge developments that are changing the face of South London making it increasingly desirable.

In South West London we have the Battersea Power Station development, which is sure to be outstanding once completed. Battersea Power Station looks like it is going to be one of the latest hangouts with their 6-week festival really starting to take shape. Over the course of summer, they are bringing us not only bars and restaurants but also dance classes, music, the arts and for you comedy lovers out there, there will also be previews of the Edinburgh Fringe Festival.

For all of the Love Island fans who are about to start morning the loss of Love Island, it’s not over yet. Iain Sterling, the voice of Love Island will be performing his material prior to the Fringe Festival alongside Matt Richardson.

There is not just Battersea Power Station, there are many other sites popping up, it almost seems like they are appearing out of nowhere. These sites are really transforming the look and feel of South London, they are bringing in lots of new homes, jobs and increasing the spend in South London and making it even more desirable.

Aside from the new developments, we also have exciting roof bars, pop up and cafes in South too. With the ever popular Neverland which has opened its doors in Fulham, with its fantastic location and its beach theme, this is going to be a hit all summer! Let’s not forget that the much loved Brixton Beach is back, also in Brixton there is the Prince of Wales and Franks Café in Peckham, the latter two among others have been voted London’s best rooftop bars for the summer. We saw the Ivy Café spreading their ivy across South London too, with the Ivy Café Wimbledon Village opening its doors last year and the Ivy Café Richmond following suit this year, which again is great for building the profile and the economy of South London.

The properties in South London are vast and varied making it such an exciting place to be, with more people relocating here for work and more home movers, whether you are buying for yourself or as a form of income, it is a great place to invest those funds.

Looking at past data, just in Battersea alone, I find it astonishing looking at Latchmere Road for example, in 1996 flats were selling for roughly £100,000 and now some of them are selling for upwards of £700,000. Also in Prince of Wales Drive, in Overstrand Mansions, in 1995 you could have paid just over £200,000 for a flat whereas now you are looking at just under £2,000,000, which really is phenomenal, most of us are probably wishing we invested in those flats!

One of the other things that I love the most about South London is the property professionals, they are so knowledgeable and passionate about their area.

They can talk in depth about the market, they can share stories about the history of the area and also the amenities. Over the past few years I have seen the standard of the professionals working in the industry increase and the bar has risen significantly. The people that you are dealing with now are experts in their field, they ensure that they are armed with facts, figures and knowledge so that they can do the best by their clients.

Here at Cherry Pick People I have the pleasure of speaking to many of you on a daily basis, hearing about your successes also sharing stories from my time in the South London property market.
I am always keen to meet new faces within the sector and to help and assist where I can, so if you are thinking of a move, know someone who is or would just like to connect, please do get in touch.