The Times has warned that estate agency is a “bloodbath”, with tough times ahead.
Journalist Patrick Hosking told the paper’s readers: “If you want to know where house prices may be heading, don’t listen to what estate agents are saying. Look at what their share prices are doing. The sector is a bloodbath.
“Countrywide, Britain’s biggest operator, is down 86% in the past 12 months. The shares are also 15% below the level at which shareholders stumped up £140m of rescue capital in August.
“Foxtons, the London-focused chain, is down 37% in the past year and has already responded to the chillier climate by closing six branches.
“Purplebricks, the lauded online disruptor, is down 60%.
“Even Savills, insulated by large international operations, is down 27%. Investors see tough times ahead.”
Hosking said that most agents are forecasting flat to modestly rising house prices, but says that it is the job of agents to take a bullish view as they act for sellers.
However, he says that their shares paint a picture “of a more grisly outcome”.
This, he says, is one where house price falls “lead to very modest transaction volumes as buyers sit on their hands in the hope of lower prices further down the line”.
Friday’s article will be behind a pay wall for many readers, but the comments on it are interesting.
They include: “Estate agents are about as necessary as high street banks. A few are needed, most are not.”
And: “Renting is the only option for many now.”
However, one commentator – maybe an estate agent? – does ask: “Anything positive to say, Patrick?”
https://www.thetimes.co.uk/article/estate-agents-are-on-rocky-foundations-v0zzqbntj
Well it seems already according to Paul Smith;s Haart that his prediction for Purplebricks in 2019 spend on marketing being unsustainable is already beginning to impact severely according to this piece in The Nottingham Post
https://www.nottinghampost.com/news/nottingham-news/estate-agent-apologises-after-sending-2399593
“Unfortunately he mistakenly claimed that Purplebricks were having financial issues when it was, in fact, a different online agency that was experiencing problems and which has subsequently gone into administration.”
Understandable that he might have got Ewemove and Emoov mixed up but….!
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“”After this emerged, we apologised unreservedly to Purplebricks who accepted our apology, plus we wrote and apologised to the recipients of the original letters.”
They were very sorry they got caught.
When I was selling with PB I used to regularly get calls from local Estate Agents and if I hadn’t been keeping an eye on the general market and the performance of traditional agents I might have been misled into thinking I wasn’t going to sell my property with PB. One of the agents seemed to have difficulty remembering they’d just been sacked because they had failed to sell a house down the road from me.
Dirty business.
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Did you not drop your asking price circa 100k?
More great advice from PB …..
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Purplebriks and cyberdcuk46 trying to mislead the members of the public into paying £100k over the odds for a property.
If purplebricks got sacked for every property they didnt sell how many times wuould they get sacked? Shame PB get paid either way as far as the public are concerned. where are your morals CD46.
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maybe some truth in this but these companies aren’t exactly smashing it anymore. Went to London other day and it looked like dexters were the boys in town now. Foxtons were nowhere. ( t hats just from driving around not real research)
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Were we not hearing a while back that house prices were increasing because of a lack of supply.
It doesn’t therefore follow that we should be looking at the share prices of estate agents to get an idea of the direction of house prices…
“If you want to know where house prices may be heading, don’t listen to what estate agents are saying. Look at what their share prices are doing. The sector is a bloodbath.”
This is just irresponsible journalism.
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Irresponsible journalism – well there’s a surprise !!
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Pot, kettle.
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Hmmm, not many financial market sectors thriving during this Brexit mess, not just the housing/building sector. Good quality desirable property that’s reasonably priced still flying out the door across the U.K.
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Crux of the London market is, low supply where properties are CORRECTLY Priced, too many agents. Not enough pie to go around. Same old property going from agent to agent then vendor stays put as the initial price has been over cooked on instruction and was never achievable.
Banks have tightened lending. So people want to move, but just can’t get the Finace required and after taking the 3% stamp into consideration the value is not there for a move.
So something has to give.
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PB share price up 25% in recent days having been hammered down into the £1.20 range from a high of £5.00……..
Must have been perceived to have dropped too low by some, back up to £1.60 now……….
I wonder who sees the light……..
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