5 Worrying Trends For UK Estate Agents
So what is in store for the UK’s Estate Agents?
Every business has its share of perks and disadvantages. Even with recent upsets with mortgage interest rates, the property market in the UK has never been stable and predictable for people.
This industry has progressed extensively beyond the frequent spikes and dips over the years.
The next ten years from year 2022 will see a significant transformation in the estate business.
Technological advancements have made their way into real estate to ease out the complex processes like marketing automation, virtual tours, showcasing and more. But these need to be encapsulated and leveraged in a Sales Marketing Success package, and we can do that for firms.
DECLINE IN THE HOUSING STOCK
When planning to invest in a property, people always compete only for the best options.
Over the years, people in the UK have been on a property buying spree in both cities and the countryside.
When the government announced stamp duty changes in mid-2020 through the end of 2021, house sales hit a remarkable number since 2007.
These endless buying and selling cycles have deflated the number of properties currently available and will further decline by 2023.
Buyers will continue to compete for a single household and quote higher bids to secure them, but fewer properties means fewer sales and as we discussed in the “It’s not rocket science” blog post, they are earning even less than they did four years ago, on the same property!
NEW CUSTOMERS – NEW IDEAS
Most sales and larger premium purchases are conducted by the Baby Boomers today.
Generation X is firmly in place and coming up fast to slide into the furry slippers of the Baby Boomers.
There are new kids on the block, but how well do you know the upcoming Millennials and Gen Z buyers? What are their buying patterns? What are their preferences and who is likely to compromise the most? Which ones pay for convenience and speed? What should you promote to Gen Z that is a waste of time (comparatively) to Millennials.
Ask for our revealing report on 20 ways to “Market to the Millennials and Gen Z, before they know what hit them” Report.
DELAY IN COMPLETION OF NEW BUILDS
The market has been unsurprisingly active despite several hiccups in the economy and the nation’s real estate policies.
The trajectory of the property demand graph is steadily growing with every passing year exceeding the number of properties in the country.
With too many houses already built within the quota, there is very little room left for building new ones.
The availability of empty lands is scant, pushing away the whole plan of building new housing units in the UK. Government funding and budget for new builds, which is insufficient, is another significant factor contributing to this entire delay.
The savvy Estate Agent will maximise their areas and market sensibly to leverage the areas that will yield the best for them. We show businesses to do this and the local based offices are ideal.
OVERRIDING DEMAND FOR HOMES
Many things have changed since the 2 year-long lockdown and opening up hiatus in the UK.
Individual’s approach towards life is one prominent aspect that has influenced the property market. With the hybrid work approach, people are now looking for bigger homes with outdoor spaces to accommodate their WFH office space.
Existing homeowners would find it challenging when they are upsizing or downsizing their homes due to the skyrocketing demand and the disintegrating supply balance.
Many have also improved their homes , but this is no longer an options as tradespeople are booked out for 6 months plus in advance.
This demand will further prolong when new listings are released again, which will drive buyer activity and help boost the overall real estate transactions.
To get ahead of the curve, clever, strategic marketing has to be launched now, and you will obliterate your competition easily.
INFLATION IN INTEREST RATES
Applying for a mortgage loan is the go-to option for all the buyers to access a lump sum in a short period. As the demand and supply do not complement each other in number, several issues have risen, making the property purchase procedure a complicated one.
With the inflation in prices in the market, other aspects involved in this process has also steered up sharply.
Central banks in the UK and other developed nations raised interest rates and will continue to increase more in the coming years. This price change will have a direct influence on borrowing costs, residential mortgage loans and more.
As a bonus.
The HMRC have been clamping down on the use of Estate Agents for Money Laundering purposes and making sure they have adequate processes and procedures. If you need yours checked, please contact us or our sister company https://complianceconsultant.org.
You may also like to read “What Drives Sales In Your Organisation?” https://compliantsalestraining.com/what-drives-sales-in-organisation/
FINAL THOUGHTS
The real estate market holds an overall positive outlook overall based on revenue generation.However, the rising prices will have an impact on a broader scale.
With borrowing costs, demand and property prices increasing everywhere, the other section of the crowd living in rental homes will have their fair share of challenges.
People buying properties as a means of investment will increase the average rental rates across neighbourhoods to compensate for the current market value.
What Estate Agents have to consider is whether they still want to be among the many traditional, staid agents, eking a living from falling commission rates?
Add to this the increased frustration from fewer properties and more savvy buyers and sellers switching to “better value” online agents, the question Estate Agents need to ask is do they want to grow their business offering to create a value far in excess of their peers, and build over one to two years to be the agency to go to for buying or selling premium properties?
You decide.