Bricks and mortar bombs – The London property market

It’s fun and games on London’s property battlefield this year and to be fair, the Shires are seeing the same. Anything half decent coming to the market is swarmed upon by battalions of buyers. Mass viewings are becoming the norm. A recent ‘viewing’  I had of a £4m Chelsea house saw 40 people through the door in two days. A Berkshire waterside development a few weeks ago saw 250 viewers at it’s launch, (pre-floods!). And if you want a ‘do-up’, bring body armour. It’s a war out there.

Those new to London house hunting, start their search with the confidence that with a million quid sitting in the bank, they can wander the streets of London chased by salivating Agents flinging gorgeous properties at them. Err, no. They’re just joining the herds of others with wads of juicy cash being treated to a taste of cattle class. Make no mistake, the London property market is swimming in lolly.

It’s different this year because the Brits are back. So it’s not just soiled Asian notes being thrown at everything, it’s also the flush Canary Wharfers, the Trustafarians, the middle aged Brits who are now confident enough to dump their cash into property stock. But unfortunately the amount of stock hasn’t really risen much, so the supply and demand mismatch continues.

Asking prices have always amused me and currently pricing varies from ‘they’re having a larf’ to the increasingly popular ‘under-price and create a frenzy’. And that is precisely what we’re getting. A frenzy, a battlefield, bidding wars. Bidding wars every flaming time and to increase the joy threshold, estate agents are quickly falling back to their default setting of ‘sod the buyer, plenty more where they came from’.

In fact every property we have bought in the past six months has been against the backdrop of other rampant bidders and often sealed bids. On each occasion my clients have turned to me and said ‘I don’t want to be involved in any bidding war’. Because to be honest, it does feel terribly un-British all this bidding war stuff. Unfortunately there is a simple and blunt response to that – well you won’t blo*dy buy anything then.

The reality is that lack of stock, loads of good buyers means only one thing, you have competition and in a war that means enemies. Buyers better get used to it. It is a war out there but it’s a psychological war.

Bidding wars, sealed bids and all that jazz can turn warriors into lily livered cowerers. It is easy to become disheartened and throw the towel in at the first hint of competition and it’s particularly scary when the impersonal ‘best bids by 5pm friday’ email hits the inbox.

But you really shouldn’t be put off. Without wanting to sound like I’m bragging (well a little bit, you have to take it where you can) I have sat here and realised that I and my colleagues have won every ‘bidding war’ we have ever gone for – and not overpaid to do it.So, how do you do it?

I am tempted to end this here with a cheeky ‘call me, hire me, pay me’  but heyho, I’m a fool to myself.

Well half the battle is to actually be in it (to win it, as the saying goes). You won’t buy a home hiding in the trenches scared or in a huff. Sounds simple but rest assured many good solid buyers are doing just that, running scared, white flag aloft at the first whiff of competition, so there’s some of your competition gone for starters. Don’t be scared off, if you’re offering, you’re half way to buying a home.

Part two of the secret to success is all about relationships. Actually, let me clarify that – it is ALL about relationships. Men and alpha females tend to glaze over when I say this and throw withering accusations of weakness at me. Because people commonly seem to think ‘tough negotiating’ means aggression. It’s a war so lets go in all guns blazing, show them how tough we are, pop some smoke.

Nope. Doesn’t work. Because people, funnily enough like to do business with people they like. And these ‘look at the size of my wad’ Captain Flashhearts, send them scurrying for the ‘no likey, no lighty’ button.

The Agent knows that if you’re a pain in the butt at this stage, the next few weeks of sales progression is going to be a right old nightmare. Trust me, Agents are people (no really), and if they can influence the Seller to avoid someone who is likely to give them hassle, they will.

The meek, insouciant, no head above the parapet approach doesn’t work either, you’ll just be mown down in a hail of indifference.

The key to success is building a relationship with the Agent and ergo the seller. A relationship which cements the fact that you are a good buyer. You have funds in place, you have a proactive solicitor, you are desperate to buy it and you won’t mess around. This is so often far more important to the seller and agent than a few extra grand from some bolshy Rambo.

Because no matter what price you offer, you are unlikely to get it if the Agent doesn’t know who you are, what you are and if you’re a safe bet. Really helps if they like you too.

Whilst you need to develop a relationship with the Agent that gives them peace of mind, it is a two way street, you also need to develop one so that you understand the Vendors position. It is rarely the one with the most gunfire (money) who wins the war. There are usually many other things that could sway them in your direction. You won’t know that unless you are eyeballing and talking and asking. Then your offer can be tailored to what the Vendor wants. At the risk of repeating, it’s rarely just the money. Some Vendors hate the idea of developers buying their home. It could be timescale. It could be fear of you being a flaky buyer. I’ve even won houses by saying we’d take on the blo*dy cat. You won’t know what the Vendor wants unless you have a relationship because if you don’t know what they want, you can’t offer what they want.

We all know the UK property market is far from ideal, I become all misty eyed dwelling on the good old days of using wit, diplomacy and empathy to chip the asking price, not add to it. The days when properties came on at ‘a bit too much’ and you offered a ‘bit less’ and a deal was done with all parties feeling they’d scored rather than been screwed. There’s nothing I (and believe it or not most estate agents), would like more than a balanced property market where supply and demand were fairly matched and it was all terribly British and respectful. But it ain’t. And if you want to buy a house, flat or shoebox in London, you’re going to come up against it and you need to meet it head on.

Neither lily livers or egos win the war. Don’t be put off by the fearful term ‘bidding war’. Gird your loins, throw your intellect grenade, and fire your charm offensive, they’re deadlier than you think. Also they cost nowt, nobody gets hurt and frankly, if you lose, there will always be another house. Always.

So, to conclude the warfare theme, most nights I download about my latest turf war battles on Skype, to my camouflage draped husband somewhere in the desert.

The irony is not lost on me, in case you’re wondering.

Apaches whirr overhead and he has an SA 80 submachine gun nestled on his Army issue pillow (I had casually written AK47 but I am peevishly informed they are blo*dy RUSSIAN). For the record he’s relieved to have got shot of Gary Barlow but there’s always a spare tent for Katherine Jenkins.

– but I digress.

We debate again that wars are won not through fire power but through empathy, relationships, intellect and above all diplomacy. Funnily enough, rather British traits, I like to think.

But through the staccato link that Skype allows us, he solemnly intones for my umpteenth time of hearing the British Army’s rallying cry to all those troops fearful of entering the battle zone.

“Suck it up sprog and crack on”.

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3 thoughts on “Bricks and mortar bombs – The London property market

  1. Is this demand frenzy driving the market into a bubble? What you are describing reminds me of the Bucharest property market from 2006-2007, when asking prices of apartments were changing twice per day.

  2. I couldn’t help nodding in agreement with this blog. As an estate agent in Wimbledon Village, of course we at Robert Holmes & Co (http://www.robertholmes.co.uk/) would like to return to the days when supply and demand is fairly matched.
    But while confidence in the property market remains high and the cost of borrowing is low, that is not going to happen.

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