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Navigating the Changing Landscape of the Property Industry: An Objective View

General Experts Corner Estate & Letting Agents

Monday, 26 August 2024

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Since 2009, I've been a consultant to service suppliers in the property industry, including CRM suppliers and portals. Previously, I was sales director in a SAAS company. My goal has always been to build solutions that help agents adapt to the political landscape affecting their day-to-day business. It wasn't my job to fight the political will of the country; but to analyse, understand, and build solutions for the moment.

The theme for the last Conservative government was improving the house buying and selling process. After the global crash, Labour took a lot of flak for spending their way out, preventing Britain from falling into a recession as many other countries did. George Osborne's austerity measures were a necessary evil to put the economy back on track. However, things seemed to go awry in April 2014 when, instead of raising interest rates when unemployment fell below 7% (as advised by Mark Carney), the low-interest rate policies continued. This approach persisted until the Truss budget, which halted the asset-inflating, feel-good economic policies that favoured the wealthy over the poor.

I had the opportunity to chat with Eddie George while on a transatlantic crossing on the QM2. In our discussion, Mr. George (Governor BOE 93 to 03) shared insights on how low-interest rates inflate asset values, including property. This inflation causes affordability issues for ordinary people and reduces transaction volumes. This fall in transaction volumes is evident in the Land Registry numbers. Despite the fears surrounding Labour's impact on the property industry, it's noteworthy that in 2021, transaction volumes under the Conservatives exceeded 1 million sales in England and Wales. However, aside from this peak, transaction volumes have generally been low, affecting agent commission incomes more than the 9% fall in property transaction prices recorded in 2023. In 2023, transaction volumes were down 45% from the previous year, and this reduction in sales, coupled with lower achieved prices, significantly hurt agent incomes.

It's essential to maintain a professional, objective outlook under Labour for the next five years. While changes are inevitable, the key message is to work with what you've got. Labour's focus will likely include increased public investment in affordable housing and improving social housing conditions, which could stabilise the market and provide new opportunities for agents and service suppliers.

In conclusion, the property market will always be influenced by political decisions, but understanding and adapting to these changes is crucial. By staying informed and proactive, agents and their service suppliers can navigate the evolving landscape and continue to thrive. As on the Apollo 13 mission, where the astronauts saved themselves, make the most of the opportunities ahead by working with what you've got, the materials and tech to hand.