Countrywide has said that next week’s general election has been the cause of falling transactions.
A trading statement yesterday said that revenues at the UK’s largest estate agent were down 2% in the first quarter of this year, at £154.2m.
The number of exchanges was down 13% year on year to 12,976.
The London market was particularly hit, with exchanges down 14% to 1,201.
Countrywide said it continued to invest £14m in the first quarter of this year in diversifying the business.
It anticipates that the market will recover in the second half of this year following the general election.
Separately, LSL, the parent company of firms including Reeds Rains, Your Move, Marsh & Parsons and Davis Tate, reported this morning that its estate agency division has traded well “relative to the weak market conditions during the first three months of 2015”.
LSL reported an 8% growth in lettings income, but a 15.2% slide in income on sales.
Its flagship London brand, Marsh & Parsons, had a 14% drop in revenue compared with the first three months of last year.
LSL said that it would continue its acquisition programme. The firm recently bought Thomas Morris, a seven-branch business in Cambridgeshire, Bedfordshire and Hertfordshire.
I am bound to get in trouble for this observation but after yesterday it might as well get hung for a sheep.
I haven’t kept track of which good independent local businesses have been bought by Countrywide in the past 12 months but how are these figures possible and what are the adjusted figures that enable a true evaluation to be made?
I am not knocking Countrywide; Corporatisation of agency by a steadily buying up the competition that prevents success is a solid and sensible thing to do, in theory it should lead to success. Retaining the appearance of local independence another smart thing to do so how is it, when genuine independent agents are reporting good solid increased levels of business despite the election, a corporate business that is constantly investing in growing its coverage is showing such a significant fall in transactions?
If I were the skipper of a boat who had bought 3 extra bilge pumps but found the waterline was no longer visible I would be down below wondering where the hole is, how big the hole is or whether the new bilge pumps are actually working.
I have to say I think selling any good solid estate agency or property management business is a bit bonkers. It didn’t happen in days gone past so why does it happen now? Traditionally businesses were built up to provide a pension. Partners would train up the younguns and train them well knowing their income when they stopped working would be in safe hands.
I appreciate a lump sum is a great and tempting thing but given the interest rates at the moment the turnover multiples for assessing a business are so out of kilter with invested returns I don’t understand anyone selling up, paying tax and struggling with a dividend that at best is 1/20th of what they were used to or could expect. Surely it is better to hand over the reigns, buy in management if you’ve not trained up a successor and retain an inheritable income generating asset which is more easily protected from inheritance tax.
No boat owner wants to wander down to the mooring to see their pride and joy weeded up and unloved but what is worse is selling to someone who doesn’t know how to sail!
P.S I apologise for my rant yesterday and offer thanks to those who tolerated it!
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
As someone who has been there and seen it I can tell you that the hole appears when they take those businesses, pull them to pieces, remove the personal service (a shed load of stuff heads off to consolidated offices), outsource a load of services so the properties and not supervised by one person who then would know everything going on with that property and pump the branches full of massively inflated fees for far less service than they were getting when it was an independent. Then you get people like me who leave because we don’t believe in those types of ethics and set up on our own and the landlords follow in droves!!
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
i totally agree 4 years ago C/W purchased a business i was working for a good solid business founded on good service and loyalty within 3 years none of the staff remain and the majority of the portfolio has gone ? dosnt make sense to purchase a business and the destroy all the hard work and good will, the reason that i suppose attracted them in the first place.
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
It is all down to the people in the offices and continuity. I am in a previously under performing Countrywide office. In the past 5 months it has completely turned around and we are Region leaders by a long way. Sales up, fall through a down, great exca corporate entity as one would a local independent. When that happens…success.hange figures and Howells for FS and Conveyancing. We have improved three things. Quality of service, quantity of service and spirit of service. There is a common denominator there as all good independents know. A single office can be run within
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
Blimey. Don’t know what happened there folks. Ultra predictive text on show with that one, but you get the drift. People, service and continuity.
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
Back in the day!… I was tasked with demonstrating software. Given a choice,1 office out of 13 in a region, I got heaps of grief from the boss for picking the worse performing office, ranked #13. In 1 month it was at #2 just behind the regional head office so I know exactly what you are saying. The trouble is that when the partners and directors leave the special bit leaves with them, staff and vendors are no longer special, they become numbers.
Someone will give you the confidence to realise, like MKM, you have special and instead of a % you could be doing it for you.
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register
Times are hard? We have seen the corporates stock diminish over the last 2 years in our area. Noticeably nearly all the staff are new young guns that fire blanks which the public have no confidence in. Have to say we and other agents are doing very well indeed so the lead story is more about not looking in the mirror and an excuse.
You must be logged in to like or dislike this comments.
Click to login
Don't have an account? Click here to register