With many industries having endured a torrid time during the pandemic I am so thankful our industry has been able to continue operating, albeit with some significant restrictions and impediments. As a small business the onset of the pandemic was scary. We have been more cautious over Covid protocols than many of our contemporaries, which has impacted our turnover, but our policies seem to have worked so far with all our staff safe and Covid free.
As a single office business, we operate in a relatively small geographical market in north Leeds. We focus on residential sales and lettings with around 500 properties in management let to professional tenants. We sell between 200 and 300 properties each year, but have no surveying or financial service subsidiaries generating additional revenue. Every month I analyse our statistics, and this week I have been looking back on the first 5 months of 2021.
Since the start of the year the number of applicants registering with us rose by 15% (compared to the same 5 months of 2020). We are aware many tenants and buyers don’t want to register with estate agents, relying on email alerts from the property portals, therefore this increase is quite substantial.
Our sales department sold 27% more properties in January to May 2021 compare to the same period last year. We couldn’t undertake any viewings on properties for around 6 weeks last year when the initial lockdown of the pandemic took place, but as soon as restrictions were lifted for estate agents last year, we made up for the 6 weeks within a couple of weeks!
One would assume this increased activity was a direct result of the Stamp Duty Holiday granted by the Government. I now doubt that is the case. As we near the end of the Stamp Duty Holiday we’re not seeing any signs of the market slowing down. Sales we have agreed recently are not going to complete until after the ‘holiday’ has ended, and buyers have been offering higher and higher prices to try and secure their purchases.
House prices have risen by just over 7% year-on-year in the area in which we operate. Our average sale price is actually 17% up on the same period in 2020, the number distorted by the fact we have sold a number of significantly higher-priced property this year.
The most staggering statistics are on the rentals side. We carried out 20% less viewings January to May 2021 compared to the same months in 2020, but we have agreed 61% more applications and carried out 28% more tenancy set ups, despite the fact we have carried out less viewings. The Government’s advice for Estate and Letting Agents during the pandemic was to carry out video tours of properties and pre-qualify both potential tenants and potential buyers – ensuring those that view properties in-person have seen the video tour and are in a ready and able position to proceed should the in-person viewing confirm their interest.
From the start of February this year, we saw a rapid rise in the number of tenants giving notice to leave their rented accommodation. The reasons for the moves were many; tenants had saved a considerable sum of money during the lockdowns and now had a deposit to buy a home; relationships had broken down; the need for more space now many people will be working from home in the future; job relocations, etc. The list goes on. We expected increased activity with the number of properties being advertised to let, but what came as a shock was the volume of enquiries – we have received 30+ enquiries for most properties, which is almost double the average we were receiving pre-pandemic. Where has this sudden increase in the number of tenants come from?
We know Leeds is a great place in which to live and work. Are we seeing a sudden influx of tenants moving into Leeds? Our data indicates that the majority of tenants wanting to view our properties already live in Leeds. I’d like to think tenants are choosing Moores as their preferred estate agent, but I’m experienced enough to know that tenants ‘chase’ properties, not agents!
Our data indicates a large number of tenants are moving out of the city centre into the suburbs (presumably for green space – supported by the number of flats in the city centre that seem to be struggling to let at the moment) but more than 50% of our enquiries are from tenants already living in the suburbs. There’s clearly a ‘shift’ in what tenants want from their rented property. Thankfully, we seem to be managing the type of property that meet their new criteria.
We initially thought we would be lucky to retain all our staff during the pandemic but with the fact our industry was allowed to ‘remain open’, and the increased activity in the market not only have we needed all our staff, but we are now expanding our teams to cope with the ever-increasing workload.
I hope other businesses come out of the pandemic as strong as we are. I suspect that won’t be the case, especially for the travel and hospitality industries. As someone who has been self-employed for most of my 42 working years, and been on the verge of bankruptcy during the early 1990’s recession, my heart goes out to them.