My Real Estate Story: Sanjay

This week, to kick start XChange’s new blog series, I sat down with Sanjay, the director at Vine Estates. Vine Estates is an independent agency operating in Central and Greater London. Sanjay began his career in Accounting and Finance but soon realised that it wasn’t for him. Sanjay pivoted to real estate in 2007, proving that hard work and self-motivation are everything in this industry. 10+ years on and he founded Vine Estates. This is his story:

 

So Sanjay, why did you pick real estate as a career, and how did it all start for you?

 

I got into real estate in 2007. Before this, I was studying accounting, but soon realised it wasn’t the path for me. I decided to take a real estate training program and got a job at a local estate agency. I learnt more about the trade and I started Vine Estates in 2013. It started as a virtual agency but we have opened up a physical location earlier this year in Heathside.

 

As a director, what do you believe is your edge in the industry?

Being a BTL investor myself, the experience of working in the industry has given me the insight to be an agency owner and a director. Within my circle of family and friends, with my experience, I tend to be the go-to for advice. The information is out there, for buyers that don’t have any real estate experience but it can be a bit of a minefield. This puts me in a good position to guide my vendors to make the right decisions for the pricing of their properties.

 

With the current pandemic, we’ve all had to change things. How have you been adapting to the necessary changes in the viewing process?

 

Usually, for us at Vine Estates, it’s about figuring things out as they come along. One of the biggest changes we’ve made is that we make sure all our properties have virtual tours. We’ve taken video walkthroughs as well as created 3D matterport. We’ve been actively pushing our customers to view the videos first before requesting a viewing. This allows us to prequalify our applicants. There is a disconnect, where applicants are still hesitant to see the value of the video tours. Which can be challenging.

 

And with something new popping up every other week, how do you keep up with the changes in the industry?

 

Myself, I enjoy listening to podcasts and am a part of forums where I can learn and hear what other industry leaders are discussing. At the end of the day though it all comes down to how ready you are to make those changes work for your agency.

 

With just over a month left till the end of the year, what are you looking forward to in the new year?

 

I’m personally, looking to get over this part and to move past the pandemic. This year has been quieter for us and we haven’t been able to get our teeth into things, which is unfortunate because we do now have a physical branch. Overall though, we’re moving more towards a fully digital customer journey with digital offers and contracts. We were already well equipped to work online, so this pandemic hasn’t been difficult for us.

 

And as a final kind of look into the future, what do you think will change for agencies in 2021?

 

I think the biggest change will be people’s aversion to videos. This industry has moved into the video realm and it needs to firmly adopt that. It helps us manage our time and ensure that those physically viewing the properties are serious buyers or tenants. Don’t get me wrong, videos won’t take our role away, it makes the entire process cleaner for all of us. At the end of the day, people still want to meet people before making a big decision like this. That, and social media. We’ve been hearing for years that social media is a must and most of us have adapted to that, however, this pandemic was a further push to ensure that everyone has their social media strategy ready to go. This pandemic has been a great time to try new things and see what works and hasn’t worked. 

Find us in London

868 Salisbury House

London Wall, London 

EC2M 5SQ 

United Kingdom

020 8064 1431

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Are people moving out of Central London to West London?

Are people moving from Central London to West London?

With the current pandemic changing where people want to live, we set out on a journey to see just how much consumer preferences have changed and what this means for the industry. With more and more people looking for space find themselves looking for properties further and further from Central London. 

Across the UK, rental searches were up by 34% in August compared to the same time last year. This increase is likely a reflection of the lack of movement during lockdown and an increase of activity from tenants as they reconsider what it is they are looking for from a home. 

Previous hotspots are now seeing people moving out as renters preference has changed. Now opting for homes that are bigger and have more outdoor space, more and more people are looking for homes in the outer areas of London. Especially in West London.  

Rightmove’s Miles Shipside said: “No one knows what the future holds, but at the moment, it’s clear to see that places with a slower pace of life are top of renters’ home-hunting wishlists.”

More tenants who were moving were going to bigger properties than before the pandemic, it found, with 34% of tenants going somewhere with at least one extra bedroom.

Almost two-thirds of Londoners who moved to somewhere bigger left the capital, typically moving somewhere cheaper and leaving unlet homes in the city. Younger renters are also opting for studios or 1 beds rather than having to share an apartment. 

We spoke to Louise Reilly the Letting Manager at Century21 – Kew. 

Shafaq: “Have you noticed a shift in where people are moving?”

Louise: “For us, we have seen a constant and steady demand for properties in West London. We have properties in North and South West, as well, all areas which are as in demand as they were before the pandemic. There are many people who love the West and we find that people are moving out of the small apartments to places that have a bit more space and have a bit of greenery. Generally people are moving towards outer London. They don’t want to stay in prime central london apartments because they are smaller or they are just too expensive.

Shafaq: “Have you noticed a shift in what renters are looking for or why they’re moving?”

Louise: “People’s reasons for moving it’s normally because either the family is growing generally people just want more space to grow. We’ve seen a decrease in 2 person occupation. A lot less sharers, which is a strange one. And is unfortunate for my landlords as many have multiple occupancy homes.

Outside space is also a massive reason, people are moving away from little flats and are looking for places where they can get some fresh air, even if it is a shared outside space.”

Shafaq: “How has this demand boom affected Century21-Kew?” 

Louise: “For us, the boom hasn’t changed how we handle our clients, but rather it’s been about us revamping how we work and how we use our team. Our days look a lot different now and we have a lot more dual roles especially since we’ve seen a massive increase in enquiries for sales properties. Properties that have been on the market for a year moved within weeks of the stamp duty announcement.

To meet this demand we’ve actually had to hire more people because there are just so many buyers.

However, the impact of this on rentals has been quite different. Affordability and rental value has definitely decreased. We thrive in the mid-range properties (properties priced between £1700-£1900) and the demand for these properties is practically gone. With landlords in the area reducing their rent themselves this has pushed the rental value down by upto 20% in some areas and this has had a domino effect. People want larger properties, more outdoor space, but their budget hasn’t really increased as much.”

Shafaq: “What is your outlook on the market for the next couple of months?” 

Louise: “Sales market will continue to be quick and fast for the next couple of months, and till the Stamp Duty incentive lasts. There’s enough buyers in the market and keen sellers. Once the sales boom subsides a little the increase in the new BTL landlords will help create a boom in the rental market which the hope is will help increase the value of rental properties. To fully “recover” and get back to a level of some normalcy will take at least a year. The rental market has historically always been stable so this decline has been a shock, but I am confident that this will return to normal in a year”.  

Find us in London

868 Salisbury House

London Wall, London 

EC2M 5SQ 

United Kingdom

020 8064 1431

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What Will Happen to Student Accommodation

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What Will Happen to Student Accommodation

The post pandemic opening of the lettings market hasn’t shown to be too promising as people were expecting. Knight Frank recorded a 0.9% drop in the prime central London rental market in the past month alone.  

As supply remains constant, and demand is falling short compared to previous years, it seems that student demand has a big implication on the lettings market in the current timeframe. 

 

The pandemic and its impact

Normally, as universities and colleges start in September, the lettings market sees its sharpest increase in demand for the year, but as most universities have announced a transition to online education, students might be looking to postpone their moving plans until the second university term in January. 

We spoke to Ben at Citian Wharf, who told us that he had seen a decrease in demand from September of last year, but the amount of inquiries for January had been much more than those of 2019. 

Despite not knowing what will happen in September, UCAS published some data last month regarding undergraduate applicants for the forthcoming 2020/21 year.

The data showed a 2% increase in applicants overall including a 10% increase in applicants from Non-EU countries

Additionally:

  • Non-EU applicants are the highest they have ever been
  • 89,000 applicants this year, 58% increase in ten years
  • Chinese applicants made up nearly 25,000 of those
  • Indian applicants made up 7,600.

Are students changing where they want to live?

Citian Wharf saw that graduate students are reorienting towards university halls instead of private accommodation, due to the fact that it is more budget friendly, and that roommates aren’t all back meaning they’re looking more for one bed studios instead of flat shares.

Local students, ie UK nationals seem to be choosing to stay home for the time being, as university life takes a virtual turn. The economic uncertainty is also a factor that plays into this, as it is much easier to stay home in order to save money. 

International students don’t see things that way though. With applications still rolling in, the international community of students still value London as a hub of education, and hence will still need accommodation. 

 

Appetite from overseas students remains

As the student lettings market takes a sharp turn due to all the unforeseen circumstances, it seems the best thing to do is to reorient your efforts towards where the demand is. 

In this case, it means captivating demand from the east, where it is the most constant and reliable. 

At XChange, we’ve seen an inflow of students that are moving from Asia and will be moving in the end of September, and a larger influx by the start of the new year in January. 

Our expertise in the London market as well as our strong ties with the east has put us in a good position facing this student accommodation problem, and here’s how you can profit from it too. 

Find us in London

868 Salisbury House

London Wall, London 

EC2M 5SQ 

United Kingdom

020 8064 1431

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Demand fuelled property market: Are you ready to close more deals?

foriegn investors buying properties in the UK

Demand fuelled property market: Are you ready to close more deals?

Following Rishi Sunak’s Stamp Duty Holiday, Zoopla has reported a 29% increase in visits this month and a 27% increase in agency sales over the past 14 days. This buying frenzy is in part due to the stamp duty holiday as well as the weaker sterling making it arguably the best time to buy. 

With this frenzy of demand it is interesting to see who is actually in the market buying. This wave of new demand is coming from multiple fronts, and different buyers require different properties dependent on their needs.

Foreign investors are also motivated to buy, following a decision made by Johnson’s government addressing the possibility of citizenship to Hong Kong residents. 

It’s becoming increasingly clear that this wave of new demand is coming from multiple fronts, and different buyers require different properties dependent on their needs. So who are the buyers, and what are they looking for?

The buyers

i) First Time Buyers

First-time buyers are more excited to take their purchase plans ahead to take advantage of the zero stamp duty as this allows them to put down a higher deposit. 

A survey done by the Legal & General Mortgage Club found that 35% of first-time buyers said that the pandemic has had no impact on their plans to buy. 

Recent figures from the Land Registry suggest that they also gravitate towards bigger properties, skipping flats all together. This will be further reinforced with the tax cuts. 

Additionally, the government is planning to extend the help-to-buy scheme, which has gained a further 13% interest from first time buyers after the pandemic. First-time-buyers are not halting their purchase but instead are more eager to take this opportunity in the current timeframe. 

ii) BTL Landlords

BTL Landlords were also handed a nice surprise with the stamp duty holiday as this tax saving leaves them with more money to invest in a property. BTL landlords spend on average £588,698 in inner London and £424,172 in outer London, which lands them in the sweet spot for stamp duty for tax savings. 

BTL buyers are interested in locations that yield high rentals and properties that can be easily monetised and have very low void periods. 

This means they tend to gravitate towards properties near university campuses, where demand comes in abundance from international students, i.e. Euston, South Kensington, Knightsbridge; and properties that are attractive to young adults in the services industry such as Canary Wharf, Clerkenwell, Islington and Shoreditch.

BTL buyers in London average to about 7.8 properties in their portfolio, meaning that such buyers tend to buy in bulk when there’s an opportunity to get a better deal. In the current situation, it’s no surprise BTL investors are looking to get a deal for some properties as their yields remain promising. 

iii) International Investors

Foreign demand represents a big portion of buyers in the UK, and much more notably in Prime Central London. International buyers purchased 44% of homes in PCL in the first half of 2019 and 58% the year before that. The tax cuts alongside a depreciated Sterling pushes such investors to make purchases now in order to appreciate their investments. 

At XChange, we’ve collected data regarding international buyers. Hong Kong alone represents 28% of that demand, and now even more demand is on it’s way thanks to Johnson’s decision. 

buyers from Asia | XChange

These cash rich investors look for properties that are in the £500,000 to £2 million mark, BTL investments. Also, some are families interested in upscale properties ranging from £5-£10 million in neighbourhoods with good schools like Marylebone and Regent’s Park.

Are you meeting the demand?

With all the current events in the estate market it’s good practise to ask yourself, how are you meeting this surge in demand?

With the growing demand, it is important to have a relevant property for your buyer at all times. Don’t let this be an opportunity to run out of good relevant stock. 

At XChange we help ensure that you have relevant stock when you need it most. Our platform helps you meet the increased demand. We also take pride in our international buyer base, with foreign buyers that are looking for properties to purchase in the current timeframe.

Make sure you meet the demand and take control of the situation by not missing out on potential deals due to lack of stock or leads. To learn more about our platform and register, click here

 

Find us in London

868 Salisbury House

London Wall, London 

EC2M 5SQ 

United Kingdom

020 8064 1431

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London’s Properties: A Citizenship Route For Hong Kong Investors?

London’s Properties: A Citizenship Route For Hong Kong Investors?

London’s housing market, most notably its prime and upscale estates has always been a target for wealthy investors from the east. Over the years, we’ve seen interest specifically from Hong Kong and mainland china. We’ve also begun to see a surge of Chinese demand as real estate agents have been reporting higher than average levels of investment in the past month. 

Buyers from HK and Mainland China now represent the largest group of international investors in the prime upscale London residential real estate market, according to a report from Beauchamp Estates.

Why the surge?

The sharp increase in buyers last month came from a statement made by Boris Johnson where he addressed Hong Kong residents talking about a “route to citizenship” in the UK

Additionally, the weakening of the Sterling, the falling property prices, the recent Stamp Duty holiday, the government’s pledge to impose an extra tax on foreign buyers from April 1, 2021, and the promise of a possible citizenship have all come in together to increase interest from such foreign buyers. There’s no doubt that wealthy eastern investors want to take action in the current timeframe.

Why international investment?

Now more than ever it’s become clear that a window of opportunity has opened for agencies all over the UK. Appealing to the international clientele is the name of the game. So what is it that they want? 

Usually, wealthy foreign Hong Kong investors come to London to invest in property where their own country cannot provide alternative investment. 

This could be due to :

  • Not enough ROI
  • Property market not liquid enough
  • Authoritarian regime 
  • Other advantages (e.g. possible citizenship)

For example cash rich Hong Kong investors would rather invest their capital in a city like London rather than taking on risk that comes with investing in unstable markets. 

London’s prime real estate market has proven itself to be a relatively stable investment with lots of historical precedent to back it up.

The types of buyers?

The interest from the east is multifold. There isn’t simply one buyer to profile look out for. Let’s start with the smaller buyers. 

These international buyers look for properties from the £500,000 to £2 million mark, new build to rent properties that produce a 3-5% annual ROI, located around the city, Canary Wharf and Islington. 

Then there are Chinese families interested in upscale properties ranging from 5 to 10 million in neighbourhoods with good schools like Marylebone and Regent’s Park.

Another type of buyer is the elite of the east, looking to spend north of 15 million on luxury properties, like mansions in Belgravia and Knightsbridge and of course the occasional 200 million penthouse. 

Finally there exists corporate buyers and other eastern property developers, investing in Canary Wharf and the city. 

How to perfectly utilise this opportunity?

In an age with an exponentially evolving society, a firm that shows it’s willingness to grow with and respond to the ever-changing needs of its clients is a firm that will succeed far beyond its line of duty. As the world becomes more interconnected, opportunities start arising. The real estate industry is notoriously local in its operations. 

However, our existing ties and offices based in Singapore and China mean that we have our feet on the ground so that you don’t have to be there. Think of XChange as an extension to your team’s assets, allowing you to go global without having to open up a branch there. 

We built XChange with a premise that investors in Hong Kong and Asia should also be able to participate in exciting high yield property opportunities in a safe environment, all while benefiting the local UK economy. 

“We are seeing lots of demand from investors who are looking to safeguard their money into a reliable London property market. The main problem they commonly face is one of trust and finding good deals. We believe independent international investors tend to not get the best deals since they don’t have an established presence and hands on knowledge of London’s market. 

XChange’s success is in part owed to our solid network in the UK and our track record working with developers and delivering high yield propositions to even the largest rental operators in the world. We are now extending such propositions to buy-to-let investors who are eager to participate in the exciting rental revolution in the UK.” 

 – Megan Wang, Asia lead, Houzen

Find us in London

868 Salisbury House

London Wall, London 

EC2M 5SQ 

United Kingdom

020 8064 1431

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Stamp duty holiday: How to use it to your advantage

Stamp duty holiday: How to use it to your advantage

Rishi Sunak’s Stamp duty holiday has buyers excited and many industry professionals wary of what this means for 2021. This holiday effectively means that zero stamp duty tax has to be paid on purchases of £500,000 and under in the hope that this will jumpstart the market.

What does the change implicate?

First-time buyers will be completely exempt from the tax. Next time buyers and property investors still benefit from the holiday but still have to pay the 3% stamp duty surcharge.

In effect, this means that buyers in this category could be saving as much as £15,000. This is aimed at helping buyers that had to rethink whether or not to purchase due to the pandemic.

Below we’ve calculated a compiled a few examples to visualize the impact of the changes caused by the stamp duty holiday.

Research conducted at Hamptons states that the average stamp duty tax will fall by £7,240 in London, where 1 out of 5 landlords spends more than £500,000 on a property. 

Existing demand has been further fueled by this holiday. With individuals eager to get in while supplies last, it’s expected that there will be a bit of frenzy buying in the next couple of weeks. 

With higher cash in their hands, buyers can now obtain mortgages at a lower LTV rate. Bringing back buyers who may have postponed their purchases during the lockdown, as well as sellers who are looking to sell to a larger cash audience. 

At XChange, we’ve seen this surge firsthand, as we’ve witnessed a 48% increase in purchase inquiries since last week as the interest rises day by day.

Who is buying?

The spectrum of real estate buyers is large with many different types of buyers. 

First time buyers:

  • The introduction of the stamp duty holiday brought in renewed interest from all walks of life, the first of which being first time home buyers. New buyers are looking to seize this opportunity to purchase a home and looking beyond their initial budget. 

  • This broadens the scope of attractive properties for such buyers, which is great news for agencies looking to increase their bottom line.

Buy to let investors: 

  • Other prospective buyers could take grasp of this opportunity, notably Buy-To-Let investors. Steve Olejnik, managing director of Mortgages for Business called this initiative “great news” for landlord investors. 

Next time buyers:

  • Next-time buyers are now keener to look for properties as they are treated the same as First-time buyers in terms of the exemptions from the stamp duty tax, aside from the 3% surcharge. 

Overall, this means that interest and demand could be taking a ramp up as prospective buyers from multiple fronts are looking to seize this time-limited opportunity.

The issue up for debate is whether or not Sunak’s plan will continue to stimulate demand in the housing market after the March 2021 deadline. Helen Miller, of the Institute for Fiscal Studies, was quoted saying that if the economy didn’t recover by then [the initiative] “could lead to a depression of housing sales while the economy is still weak.”

So the question here is, how can you profit from the renewed interest in this time-limited period? And what can be done after then? 

How to better utilise the increased demand to maximise profits?

  • Look into your database and reach out to buyers that were looking post-pandemic

This stamp duty holiday is ideal for prospective buyers who were looking to buy, but were reluctant due to uncertainty, as it gives these individuals the extra push they need to go through with their purchase. 

  • Don’t be limited by your branch location

When demand comes at a larger rate than previously expected, the most efficient thing to do in order to materialise all the leads, is to look beyond your horizon of operation. For example, don’t turn away leads that are looking for properties in SW8 just because you don’t have them. Look into sourcing more properties in those areas. Property trading is a great way to close a deal without having to open a branch in another area. 

  • Get properties on demand for your applicants

Stock and more stock. That is the name of the game. Find the stock your lead is looking for. If they’re coming to you, you’re already ahead of your competitors. Don’t waste it. 

Easier said than done, and though this process is labour intensive, there is help available. 

XChange exists as a platform to help generate stock for you so that you can close more deals. Our wide range of properties allows you to find relevant properties for your applicant with a click of a button. In a time where contacting landlords one by one is simply not efficient, using a revenue generating platform like XChange will be what gives you the competitive edge in the market. XChange gives you the power to access properties on demand in areas all across London. Not only can you find matches for your applicants within 48 hours but you can also request properties you want to see. To learn more, you can register here.

Find us in London

868 Salisbury House

London Wall, London 

EC2M 5SQ 

United Kingdom

020 8064 1431

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Could the East provide the boost that UK real estate needs right now?

Could the East provide the boost that UK real estate needs right now?

In light of the challenging market conditions in recent months, many corporate agencies are having to let go of their staff or close their premises. Difficult times make any possibilities of transactions look bleak. However, there is still some movement in the real estate market, for those who are actively involved. Leaving the portal worries and barriers aside, the property market remains attractive for overseas buyers. The primary driver for this has been the weaker Sterling which has been further emphasized with the arrival of the COVID crisis in the UK. This favourable shift in currency combined with attractive funding costs and mortgages available at rates as low as 0.8%1, it’s no wonder that there is an opportunity.

With China on the road to recovery and accounting for less than a tenth of worldwide coronavirus infections and barely any of the new daily cases, life is starting to return to somewhat of a normal. Businesses are gradually getting back to work; Small and medium-sized enterprises nationwide had resumed work at a rate of 76.8% (as of March 292). 

The UK has always been a global target for Chinese buyers, with London being the top destination for Asian outbound capital in 2018, according to CBRE in last year’s report. The fact that Chinese buyers in the UK rose from 2.5% in 2016 to 20%3 in 2019, is a good illustration of this trend. As long-term investors, Chinese buyers are attracted to the UK based on strong fundamentals of the British economy, a well-developed judicial system as well as globally ranking educational institutions amongst other factors. With this outlook in mind, these buyers are less sensitive to any short-term economic or political uncertainty that may arise. Instead, this proves to be an opportunity to secure real estate in areas with strong growth potential.  Again, to illustrate, in 2018, 18% of total outbound investment targeted London, which was increase from 13% in 2017. 

With limited activity in the Asian markets over the last 3 months, they’ve had a lot of time to interest shop, with certain schemes seeing up to a 50 to 60%4 increase in East and West London.  With overseas purchases looking attractive at the current depressed levels, the only barrier is how do you get access to this international demand? XChange by houzen is a prop-tech that emerged to help break those international barriers way before COVID-19 emerged. For the past 3 years, they have been partnering with Independent Agencies to open their horizons and portfolios to international demand. In 2019 alone, 60% of all successful transactions were from international applicants from China. Most of which viewed the property through WeChat or Virtual tours and made the decision all before even landing in the UK.

Megan, XChange’s China Market Lead who works mainly with Chinese applicants based in Chine and in the UK. She says “There’s still a high demand for property viewings, however, we switched in 70% of cases to virtual viewings, by video call and WeChat. Most of the applicants don’t have a problem viewing a property this way and are comfortable making their decision just based on that. In terms of how many people might actually arrive in the UK later in the year, I see a potential for a spike in the number of international students moving to the UK.” Megan adds: “Some universities lowered their required grades for Chinese applicants, so if the situation with coronavirus gets better soon, we might see an even higher number of incoming students later on”

We also spoke to Credo, a leading Chinese relocation agent and asked their views on the outlook of the real estate market. 

“Although we were indeed concerned about Covid-19’s impact on Chinese students and young professional going abroad, once April to May rolled around, it gave us lots of confidence that the demand is still there and even stronger – as for them it’s about international education and a long-term life goal instead of this temporary lockdown situation.

“With positive feedback from our local channels that the number of Chinese who applied for, or have received offers from UK universities has exceeded the same time over the last few years, we believe the renting demand will start to rally later this summer. If the market is so active this year during pandemic time, we could not be more optimistic about the demand from China in the future.”

With the ongoing restrictions on the market, XChange is opening its doors to bigger agencies to support the market during this time. By providing the means to easily connect with the Asian market, there is room for the business to be done. 

Find us in London

868 Salisbury House

London Wall, London 

EC2M 5SQ 

United Kingdom

020 8064 1431

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The growth of PRS in London has altered tenant demographics. Who’s moving in? and why?

The growth of PRS in London has altered tenant demographics. Who's moving in? and why?

Times when the PRS tenants were picking rental merely as a way to wait until they’re ready to take a mortgage are long gone. The renting lifestyle has become a conscious choice for many – and these people have specific wants and needs. If your property fulfils them, you might get yourself a fantastic, well-paid tenant for many years, not just for your usual 12 months.

Demand for the private rented sector: 
The proportion of households in the PRS sector is said to rise to 22% by 2023. Previously, young professionals (25 – 34) made up the largest proportion of renters, this has now been taken over (though marginally) by 35-49 years old. This age group is expected to show the biggest growth in this sector over the upcoming years as obtaining a mortgage is becoming harder and harder. Home buying still remains a hurdle for many individuals. 
 
This correlates with the rise in the professional-managed PRS units. Currently, there are around 30,000 units already completed with a supply pipeline of around 110,092 under construction or in planning. With buy-to-let landlords leaving the market and fewer mortgages being taken out, this is necessary to meet the increasing demand for rental apartments. 
 
Different kinds of renters: 
 
The key to closing more deals is to better understand who you’re selling to. “When you work in agencies, you see every day how important the agents are, that people still want to deal with people and that it’s people who make things happen,” says Jaimie Beers, Managing Director of Madley Property Services in London.
 
More and more individuals living in the UK are living in a rental property and this is expected to continue increasing for the next 3 years. It is important to understand what kind of tenants you’re working with to better understand how to cater to their needs.
 
According to a survey, the biggest proportion of tenants in the private rental sector at the moment are aged between 35 – 49. With homeownership becoming more and more difficult this age group is likely to grow. This age group is closely followed by young professionals aged between 25 – 34. 
 
The survey has found these different tenant groups in these age groups: 
 

 
In London, Sharers makeup 27% of the rental market, followed closely by the nesters at 23%. With over 55% of the applicants surveyed stating that they are renting because they do not have the deposit for a mortgage. 
 
So what are these renters looking for and how can you target them? 
 
Tenants want: 
  1. Affordable housing 
  2. Homes that are within 5 miles of their current residence 
  3. Homes that are within a 30-40 minute commute from work 
 
Targeting these tenants requires the following: 
  • Finding properties that match their requirements (location and price-wise)
  • Internal amenities are very important for this age group
  • Being close to transport links is also important 
 
Key Driver for Remaining in Rented Property 
  • Affordability
  • Lack of mortgage deposits
 
Affordability is the biggest deciding factor
 
A survey was conducted and tenants were asked what was ONE of the most important factors when choosing a property. 
  • 61% stated that the rent is within their budget 
    • This is why it’s important to understand your applicant’s affordability range and ensure that you don’t show them properties that are over their budget. 
    • Next, is finding properties that fit the applicant’s requirements within that budget – XChange has a solution for that. 
  • 23% stated that the location of the property was the most important
    • Living close to transport links and work is also important for individual renters.
  • 10% stated the size of the property was the most important. 
 
Other factors when choosing a location to live in? 
 
 
So how can you use this:
 
One of the best ways to build a strong relationship with your applicants is to simply listen to them, by listening to them you’ll understand how they work and be better suited to find them a property that they will close on. Remember, it’s all about building a strong relationship with the applicant. Keeping this in mind, XChange has a solution to help you make this process more efficient. 
 
At XChange our tech solution recommends properties for your applicants that match their requirements. 
 
Our applicant matching solution works to find you more properties for applicants that are sitting in your CRM, or vice versa. By inputting your applicant’s requirements we can match them to properties listed on XChange. We’ve created a centralised platform where you can do all of this in one go. 
 
We partner with Independent Agents and growing agencies because we believe that compared to the bigger corporations, you have the ability to close deals faster and provide the leads with better customer service than premium corporate agencies can provide.
 
Want to get started and see if your Agency qualifies, contact us through the form below and we’ll give you a call.
 
 

Find us in London

868 Salisbury House

London Wall, London 

EC2M 5SQ 

United Kingdom

020 8064 1431

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Is London’s PRS focus in 2020 shifting to the East?

East London | Canary Wharf
With the rise in demand for rental properties, one wonders how is London going to meet the incoming demand for rental properties? Reports show that the Private Rental Sector is expected to grow by 22% till 2023. The development of Canary Wharf 30 years ago served as the catalyst of completely changing the East End. Tower Hamlets represents the borough that has has seen the most change, making it London’s fastest growing borough. More than 500 new tall buildings are in the pipeline across Greater London, with half to be created in East London. With the soon to be created Crossrail, the East End will be even better connected to the West.
 
 Canary Wharf. 1992 (Left). 2017 (Right).[/caption]
 
Who’s moving to East London?

Young professionals and couples (aged between 25 – 49) are amongst the biggest group of renters in London. This borough is made up of a diverse group of international migrants, with the census showing that 43% of the residents were born outside of Britain. This group of renters is made up of the following:
These individuals are looking for properties that are:
  1. Affordable
  2. Close to their work
A recent survey by Zoopla shows that a quarter of customers don’t use online portals when conducting their property search. Instead they rely on the other channels. One of which is receiving property updates from agents that match the criteria of properties that they are looking for. Though the use of portals is still very important for Agents to market their properties, it is just as important to develop your email marketing campaigns as well as develop your social media channels.
 
What should you look forward to in East London?
 
With the wide spread regeneration in East London, there are many new developments that are catering to the renting population. Providing more than just a home but rather a lifestyle. Here are a few developments to keep your eye on:

A BTR development consisting of 294 apartments and provides residents with luxury amenities without being in Central London.

975 homes and retail space just a stones throw from Canning Town Station.

A 65 acre space that combines living with nature.

High-end rental properties providing close links to the city. 

Not working on these properties yet?
 
To get instructed on some of these properties, click here
 
At XChange we partner with Independent Agents with an aim to empower them and to help them grow their businesses in an environment that is slowly becoming crowded by the bigger corporate agents. We believe Independent Agents have the power to close deals faster and provide the best level of service for Applicants. By helping agents access properties that they would not normally be instructed on we want to provide an avenue for these agents to perform and grow their business. 
 

Find us in London

868 Salisbury House

London Wall, London 

EC2M 5SQ 

United Kingdom

020 8064 1431

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How the government is pushing landlords towards short-lets

How the government is pushing landlords towards short-lets

XChange has a partnership with Hostmaker, a company providing end-to-end short-let management. 
 
In recent years, the government has been placing severe measures on buy-to-let investors. This is to discourage them from considering residential property as an investment. The hope was to reduce the pressure on house prices and free stock for owner-occupiers. The most prominent of these measures is the phased reductions in tax relief on buy-to-let mortgages introduced in 2017.
 
Due to this, half a million rented homes could be taken away from tenants and moved towards the holiday lettings sector states the Telegraph*.
 
This is because, from April, landlords will no longer be able to offset their mortgage costs from their tax bills. Those who have holiday rentals, will. Especially if these properties are in cities where there is a high demand for short-lets. These properties offer higher returns than the traditional long-term rental market. They also give the added flexibility for the landlords.
 
As a result, 2.7% of landlords have moved their properties out of the private rental property sector (according to a report by letting agent body ARLA Propertymark and Capital Economic). Though a small percentage, this equates to 46,000 homes no longer being available to the long term rental market.
 
As the supply levels for private rental properties falls, the rentals continue to increase. According to Rightmove, rents increased by 2.4% across the UK. The more rental stock removed from the market the more this is expected to increase.
 
Though the holiday short-let industry is profitable for many people, it is not suitable for every landlord. There is a lot of work involved in setting up and running a short-let property.
 

Potential revenue opportunity for your agency

 
To meet this demand, there are many new businesses that are targeting landlords that need help managing their short-let properties. One of which is Hostmaker, a business that gets your property ready to be listed as a short-let as well as helping find and manage leads for said property. In the past 4 years, the number of Airbnb UK listings has gone up four times according to the ARLA report. This is an increase from 18,000 units in 2015 to 77,000 units in 2019.
 
The general consensus is that this trend will continue to rise as the market is quite lucrative. What’s interesting to note is how short-lets are concentrated in places where prices are already more inflated. Thus putting more pressure on affordability.
graph of ST & LT supply levels in the UK
 
For example:
 
  • In Havering (East London) average house prices are £361,970 and only 0.2% of property stock is listed on Airbnb.
 
  • Compared to Westminster, where average house prices are £946,430, that share is 6.7%.
 
 
As short-lets become popular it’s important to keep an eye out on the growth and find ways to support your landlords if they decide to make the switch. At XChange, we understand that though the appeal for short-lets is high, the work involved is even greater. This is why we have partnered with Hostmaker to make it easier for independent agencies to meet the short-let demand. By partnering with us, we provide the tools and support needed to grow your business.
 

So where do you go from here

Earlier in 2019, Tfl banned short-let advertising in the tube, claiming that those ads were offensive and were sending the wrong message. This makes the market lucrative but not without hurdles to overcome. This is where we can come in. If you’re finding it difficult to service your existing short-let landlords, we believe that we can help. 
  
At XChange, our goal is to empower Independent agents in growing their businesses. By providing them with the support and tools that they need to further make an impact in their local market.
 
Looking for some more guidance? Get in touch and one of our advisors will help you get started.
 

*All statistics obtained in this article are from the Telegraph’s article which can be seen here: https://www.telegraph.co.uk/property/buy-to-let/governments-attack-buy-to-let-landlords-has-completely-backfired/

Find us in London

868 Salisbury House

London Wall, London 

EC2M 5SQ 

United Kingdom

020 8064 1431

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