How to adapt to “The New Normal”: Taking stock of the changes across property sector

It is undeniable that we are all currently living in very strange times. In only a few months, every sector has changed dramatically. This especially includes the property sector — an industry that usually relies on face-to-face contact and personal relationships. Despite this, there are ways to develop within “The New Normal”. Flexibility is the key to learning how to thrive in our new world.

To better understand what your potential clients are looking for, you need to look at how your business is running. The first change to note will be whether or not you will be staying in the same offices as before, or even an office at all. Whilst it can be almost guaranteed that many companies will still see the value in keeping a bricks-and-mortar HQ, “The New Normal” has made everyone reconsider what they deem to be an essential place for work, and what that place needs in order to be most efficient.

What will be most important to your business going forwards? And is that drastically different to how you operated before?

Just like many businesses, potential commercial clients might be looking for smaller workspaces with the intention of having only a few staff members in at a time. Commercial property owners must assess how their assets with 100+ capacity can be modified to fit the needs of this changing time.

You also may need to reconsider the potential layouts of your offerings. Spaces designed around tightly-knit office cubicles, hot desks, and communal areas are likely on their way out. If these are the aspects you highlight when showing clients your portfolios, now is the time to rethink that strategy.

Now more than ever clients are looking for places with high-speed internet — this goes for both commercial clients and private tenants. Previously for tenants, high-speed internet was often a “nice to have”. In a world where many will begin working from home, top broadband speeds will be a necessity. Think about how high-speed internet will benefit your business and staff. If you have been joining the trend of video-viewings in lieu of in-person viewings, you will already know how reliant on internet the future of house-viewings now is.

In the 2020 budget, Chancellor Rishi Sunak announced £5bn of investment to be put towards connectivity, involving putting full-fibre and gigabit capable networks into every home and business during the next five years. Top-speed internet is clearly the priority of “The New Normal”.

Likewise, the ideal locations of your properties might change. A decrease in the requirement to commute might mean that your potential private tenants begin looking outside of the city for a place to call home. It might be worth taking a look at your portfolio to see which of your offerings are slightly further out of what you ordinarily would market as an easy “commutable distance”.

Which of your offerings are in beautiful areas or near coffee shops and social hubs? Do you have any further-out properties that are larger or nicer than something for the same price in the city? Cultivating these will be the key to success. That is not to say that your city properties are now worthless — many businesses will still see the benefits of being city-based, as will many private tenants who still commute or love the city lifestyle.

Flexibility extends beyond changing your portfolio and how your business runs day-to-day. Your contracts might also need a rethink. As businesses move away from bricks-and-mortar as a long term solution, consider taking on shorter-term contracts to fill your office spaces. By doing this, you will make sure you have a constant flow of tenants rather than relying on long-term tenants that may become few and far between.

This may require rethinking the clients you look for. Consider renting to small businesses and start-ups, or invest in turning your office spaces into co-working offices. If you stay flexible and embrace a steady stream of a variety of businesses, you may find it easier to fill your properties than if you rely on long-term contacts or your traditional clientele alone. As businesses rebuild, short-term bricks-and-mortar will be vital.

In short, it is of the upmost importance that you stay relevant in “The New Normal” and flexibility is the way to keep from being obsolete. Be willing to observe and lean into the new trends that will appear, whether those trends are new prime locations for properties, dynamic shifts in how commercial offices work, or an increased reliability on technology. By keeping your portfolio flexible and up-to-date, you will undeniably benefit from “The New Normal”.

Written by Israel Moskovitz,

“How to adapt to “The New Normal”: Taking stock of the changes across property sector” first appeared on my Medium profile.

New PDR for residential buildings offers an opportunity for freeholders to get the sector moving after Covid

The Government has announced a plan to expand Permitted Development Rights (PDR), allowing residential blocks to be expanded by up to two storeys without prior planning permission. With the PDR for residential buildings set to come into force in August, freeholders have a great opportunity to kickstart the property and construction sectors after coronavirus.

Post-Covid opportunities

Covid-19 has forced the entire sector to adapt rapidly to stem the spread of the virus. As I wrote recently, the residential sector is coming out of hibernation after three long months in hiatus. New ideas about how to market and sell properties will be needed. But, for freeholders, it is important to consider ways to take advantage of the opportunities already in play.

The new PDR allows residential apartment blocks over three storeys tall to be expanded by a further two storeys without planning permission. In effect, this gives freeholder the ability to significantly increase their existing assets without needing to go through lengthy and costly new planning applications.

The recent announcement by the Government offers freeholders a first tentative step into the brave new world of post-Covid. As we begin to emerge from lockdown, we must ensure that we maximise any and all opportunities.

Dual housing crisis

The housing shortage has existed in this country for years, with limited substantial effort being made to rectify it. In recent months, this crisis has been compounded by Covid-19. In order to respond to this dual housing crisis, there is a need to move quickly and efficiently to build affordable new houses. This sentiment was elucidated in a recent speech by the Prime Minister, who pointed to the housing sector’s role in getting the UK’s economy back on its feet.

The new PDR enables freeholders to do this by removing limits on block expansions, meaning more residential properties can be created quickly and easily. Likewise, by avoiding the need to build new developments, the PDR provides freeholders with a greener and more environmentally friendly way of increasing housing.

Considerations

When embarking on a new development, it is of course important to make certain considerations. Any redevelopments will inconvenience top floor leaseholders and tenants in the short term. Measures should be taken to prevent the disruption caused or, if disruption is unavoidable, alternative arrangements should be made available.

Furthermore, current top floor flats might lose some value in redevelopment. It is important to have these conversations with leaseholders and tenants early to explain the situation.

There are also strong benefits to this new announcement that will help both freeholders and leaseholders. Old roofs will be fixed with no cost to the leaseholders and lifts replaced. Likewise, construction work will provide freeholders the opportunity to carry out other important maintenance work.

Conclusion

Of course, this new PDR only offers us with a first glimpse into the post-Covid property sector. But it is increasingly clear the Government intends to stimulate the economy through construction. While freeholders must continue to search for new and innovative ways to adapt to the new normal, the PDR also offers a promising first step as we move out of lockdown.

Written by Israel Moskovitz,

“New PDR for residential buildings offers an opportunity for freeholders to get the sector moving after Covid” first appeared on my Medium profile.

New ways to advertise properties during Covid-19

Coronavirus has proved to be an obstacle for many industries, not least the property industry. With the restrictions created by social distancing, traditional methods to advertise properties during COVID-19 and steps for selling a property have had to be altered. This new landscape can be difficult to navigate.

Firstly, it is essential to adhere to official advice. As of 13 May, people have been able to move to a new house. Agents can list new properties, and in England they are able to visit properties to take photos and videos provided they adhere to public health guidance. Estate agents should not be visiting the property if any member of the household is showing symptoms or self-isolating. Physically distanced viewings are now allowed in England. However, they must only take place with serious buyers who are genuinely interested in the property. In the haste to get back to normal, it is important to remember that the safety and wellbeing of everyone involved is the most important issue.

While physically distanced viewings that adhere to public health guidelines are now allowed, tech savvy agents have been adapting to virtual views by embracing new technology such as video walk-throughs, 3D imaging and drone footage to showcase properties online. These methods can be extremely effective and are Covid-19 friendly ways to advertise a property. For those who were reluctant to embrace new technology, Covid-19 could be that final push to do so. Adopting these methods now, out of necessity, could ultimately benefit your business in the long run, even in a post-coronavirus world.

Preparing for a virtual viewing is similar to preparing for a face-to-face viewing, in that the property should be clean, decluttered and well lit. Do not neglect the outdoor spaces. Mowing the lawn, sweeping pathways and arranging any outdoor furniture will make a difference.

Plan your route, where you are going to walk and what rooms you are going to show, ensuring nothing is blocking your path. Once you have planned your filming route and what spaces you would like to focus on, decide what features you would like to give greater airtime to. Does the property have a kitchen island or a nice view from the master bedroom? Remember to give time to the front of the property and back garden as well. Also remember — you are not just selling the house, but the local area, so sharing high quality images of the local town will be beneficial.

Ensuring that you have high-quality video footage is essential. While a camera is useful, it is by no means necessary given the quality you can achieve on today’s smartphones. It is important to note that videos should be filmed in landscape and at eye level. Do the property justice by capturing it in the best possible lighting; turn the lights on, open the blinds and curtains and wait for a nice sunny day. A huge benefit of pre-recorded walk-throughs is that you are able to showcase the property at different times of day, in different lighting.

Multiple practice run throughs might be necessary before the video is ready for commercial viewing. It might be worth getting a professional to edit the video to maximise its impact. It will be personal preference whether you want commentary or music.

Many in our industry have also been hesitant to make the move onto social media platforms, due to the belief that clients are not looking for property services on these platforms. However, it must be acknowledged that our client base on these platforms is growing. Social media is a great way to interact with users, share good press and advertise properties. Paid ads on Facebook and Instagram are often the most effective way to get in front of clients. Facebook has a great variety of targeting features that ensure you only pay to get noticed by your key target audiences.

Today’s consumers like to do a lot of research themselves online when making major purchases, and that includes buying a home. Create a professional, user-friendly website that makes it easy for users to access all of the information they may need. Make sure all your property pages have great photos, virtual tours, a list the hot spots nearby and their respective walking or driving distances and easy access to online maps. Also consider tools such as Google My Business, which makes it easy for users to find you in Google Search, Google Maps, and Google+.

When advertising and selling a property in the current environment, all parties will have to adapt and be flexible. If you are conducting face-to-face viewings, be sure to follow guidance closely. Covid-19 has significantly affected our industry. However, if you have not yet stepped into the virtual property world, this is your “silver lining”. Now is the perfect time to experiment. This technology will not cease to exist post pandemic. Instead, it is likely to become a base line expectation, so those who capitalise on it now will continue to benefit well into the future.

Written by Israel Moskovitz,

“New ways to advertise properties during Covid-19” first appeared on my Medium profile.

How to… build a good relationship with an estate agent

For anyone selling a property, efforts to find and build a good relationship with an estate agent holds the key to long term success. Statistics from the property-listings website, Rightmove, indicate that an outstanding estate agent will get 136% more leads over twice as quickly as an average agent. They are also far more likely to sell houses, with over 90% of an outstanding agent’s stock being sold. So, the essential question for anyone selling a property is how do you find an outstanding estate agent, and how do you keep hold of them?

The first decision that a landlord must make is whether to go with a large estate agent chain or a small, local service. Both have different merits. With a large firm you are guaranteed to receive a lot of exposure. Large firms such as Foxtons or Savills have enormous resources, allowing them to attract a higher amount of traffic. That name recognition may also attract a higher quality buyer, particularly from overseas. However, there is the risk that, as with any large firm, a landlord could feel lost amongst other clients. Therefore, a smaller estate agent may offer a more personalised experience and might be a better choice. Though smaller firms do not have the same resources, they are likely to have significant knowledge of the local area and will be able to provide a more tailored service to you.

Moreover, the right estate agent will depend to a large extent on the type of property you are looking to sell. An affordable property would be unsuitable for a high-end estate agent and vice versa. When choosing the right agent, it is important to ensure that you understand the types of properties they sell. If you are looking to sell multiple houses, it is also advisable to have more than one estate agent so as to avoid this issue.

Regardless of the type of estate agent, building a good relationship requires a good deal of professionalism. It might sound obvious to point out, but landlords must treat their relationship like a business. This means organising weekly calls, emailing regularly and responding quickly, and keeping them up-to-date of any planned works you intend to do or any other key announcements you might have. This way, agents are able to work with you as partners.

Part of maintaining professionalism is ensuring that you make contact with the agent early in the week. Most estate agents will hold a weekly meeting on a Monday morning to discuss the weekend’s viewings and formulate plans for the week. As a landlord, it is important to ensure that you are constantly involved in those plans. Therefore, make contact with estate agents on Monday afternoon to discuss their plans for the week and how your properties will fit into them.

At the heart of any successful relationship is a deep level of trust. Naturally this will take time to develop. However, small gestures can go a long way to building up trust. Regular calls and visits will do this along with providing estate agents with information and resources that help them do their job. If you are able to be transparent about the properties you are looking to sell, an estate agent will form a better relationship with you and do more to sell your properties.

Written by Israel Moskovitz,

“How to… build a good relationship with an estate agent” first appeared on my Medium profile.

How to… find a property manager

Good property managers offer landlords a win-win: not only do they reduce the number of hours that a landlord needs to spend looking after his or her property, they can also be a cheaper option in the long run. A property manager’s expertise can help simplify the traditional headaches for landlords: working with tenants, ensuring rent or service charges are paid on time and keeping up with necessary maintenance work. These are all reasons why it is essential you should find a property manager well versed in the renting sector.

When looking for a new property manager, always ensure that you begin sourcing candidates from a regulatory body or a recommendation from another landlord. However, property managers are not all the same and different companies will offer different levels of service. Therefore, it is essential that landlords hire property managers who offer them the correct services for their needs. In particularly, it is crucial that a landlord understands details like whether a property manager solely deals with long-term lettings, or whether they offer short-term letting services too.

Any good property manager should know their local area. Make sure that you ask any potential property manager about the history of the area that your property is in. This will give you a better understanding of their ability to deal with commons issues. It is always worth thinking about what questions a would-be tenant would ask and putting those to any potential property manager.

The managing agent is the main point of contact for tenants and therefore it is important that more than just being competent in legal and financial matters, the way in which an agent conducts themselves reflects upon the landlord. Telephone manner and email correspondence are a key method in which agents and tenants interact, therefore be sure to get a full scope of their manner as it could often reflect badly upon the landlord. Responsiveness and speed are often as important as the ensuing actions.

It is also important to understand the breakdown of costs to ensure you maximise the service you receive. Property managers will charge between 7% to 10% of the rent. However, always consider whether the smallest percentage is the best in the long term; property managers might also ask for additional fees. Furthermore, with the introduction of the Tenant Fees Act, landlords are limited in the scope of charges they can make to tenants and therefore managing agents may look to recoup these costs from the landlord. For example, many good property managers will ensure that they pay regular visits to the tenant to ensure that the property is in good stead. Make sure that you are not caught out by this being a paid extra outside of the standard service.

Likewise, make sure that you know how property managers intend to deal with repair and maintenance work. Often, managers will want to manage maintenance decisions up to a certain cost. Ensure that you are happy with this threshold before committing to a property manager.

Finding a good property manager can make a landlord’s life easier whilst significantly reducing the cost of renting out a property. It is always sensible to make the investment in a good property manager — it will be in your interest in the long term.

Written by Israel Moskovitz, first appeared on my Medium profile.

How… to build a property portfolio

Building a property portfolio is a way of forming a secure investment that provides long term returns. However, to do it well requires investing both time and money wisely. Having been involved in the industry for over 30 years, I have learned valuable lessons for anyone looking to build their own property portfolio.

Before you can begin to build an effective property portfolio, you must first establish the purpose of your investment. Setting clear goals for yourself before you begin you commit to property investment is essential. Most people will look to build a property portfolio for one of two reasons: to see their capital appreciate over time or to derive a sustained income through collecting rent by becoming a landlord. Ideally, investors will look to benefit from a mixture of the two. Whatever your motivation, make sure you always keep sight of your end goal — this will help maintain perspective and ensure you are making calculated decisions. You must also establish the types of property you invest in, residential, retail, restaurants, warehouse and storage, or office spaces. Here you must play to your strengths and ensure you fully understand the market you intend to focus on and the external factors that could impact your investment.

Having done the groundwork, it’s time to work out whether or not you are practically ready to make an investment. Although many websites claim that property investment is easy, do not be fooled: building up a property portfolio is a big commitment, the property market can vary and will inevitably have its ups and downs. It is essential that any would-be investor is realistic. Don’t invest if you don’t have the funds (as a rule of thumb, below £100k in equity or liquid funds will probably not be enough) and don’t try and grow ambitiously if you cannot guarantee the cashflow. Property in its very nature is a long-term investment and therefore you should not risk capital that you may come to rely upon in the short term.

If you’re are satisfied that you are in a strong enough financial position to make an investment, then next question is where to invest. This is the million-dollar question and largely depends on circumstances. Maintaining a property and managing tenants is a full-time responsibility. Understanding the area and having relationships with local suppliers and service providers is essential. You may wish to employ a property manager to reduce your burden, however this will impact your potential returns.

However, with house prices currently falling at their fastest rate in London in 10 years, now is a great time to buy in the capital with low prices and while the rental demand remains high. London is notorious for high property prices, so you are likely to soon see returns on your investment.

Growing long-term, you must remain cautious when acquiring additional properties. You must be aware of the difference between short-term volatility and long-term growth. Most importantly, you must keep a firm grip on your debt position. Avoiding cross-collateralisation is essential in ensuring that any potential issues with one property doesn’t compound across the rest of your portfolio.

Making investments at the right time is crucial. If the price looks right and you’re confident that you have the ability to fund and manage the property, my advice would always be to invest. However, remember why you set out to build a portfolio in the first place. Whether that is to become a high-flying landlord or just to have a retirement nest egg, keeping sight of the purpose of your portfolio is crucial in staying grounded and making sensible investments.

Written by Israel Moskovitz, first appeared on my Medium profile.

How to… invest in your first property

Property investment takes time, effort and a good deal of resilience. From my experience, I have learnt that good judgement must be honed and developed, and any would-be investor is bound to make mistakes. This is particularly true when investing in your first property. There are, however, several things that investors can do to avoid common mistakes as you invest in your first property.

Bad investment decisions often occur because the requisite research has not been conducted. Any first-time buyer should do their research beforehand to understand the buildings location and potential.

Read the property pages, go on house viewings in different areas and look at different property types to compare what you get for your money. Building an understanding of the types of property available and the typical residents will give you a better chance of succeeding when targeting your first investment.

First-time buyers in London, for instance, should always look to cast their net outside expensive central areas. This might mean looking at properties in commuter belts, or places that are likely to expand quickly. Understanding transport link expansions is an incredibly useful way of working out whether an investment will appreciate over time. Properties along the proposed new Crossrail line in London, for instance, are likely to see a good appreciation of value over time.

First-time buyers can be caught out by experience. One of the best ways to protect against this is seeking the advice. This is particularly true when it comes to money. Always get the advice of a professional accountant before making an investment to ensure that you are not caught out by cash flow problems.

Any would-be buyer should also ensure that costs are kept to a minimum. Starting small, investing in an affordable property or looking to buy with a partner are all great ways of doing this. But investors should be confident any investment relationship is a strong and long-lasting with appropriate contractual guarantees that avoids any ambiguity in the partnership should problems occur down the line.

Finally, investing in a first property should be, first and foremost, a business decision. Make sure you have done the maths before you invest. Buying your first property should be a rewarding experience. However, this emotional instinct can sometimes cloud investors’ judgements. Therefore, a buyer should always look to invest smartly in a property that is likely to attract strong and reliable tenants while also delivering a good long-term return on investment.

Written by Israel Moskovitz, first appeared on my Medium profile.