Tell me a little bit about yourself and your role at Colliers International.

I joined Colliers in 2002 and have been promoted through the organisation over the course of my career. I started as part of the brokerage team, completing over 500 transactions and providing a full range of services to both national and international clients. My strength is in building lasting relationships with clients and advisers which in turn helped me achieve my longterm goal of joining the Colliers leadership team in 2015. My leadership philosophy is that it’s through relationships and trust that loyalty and influence are earned. I want my team to follow me into battle because they want to, not because they have to. New disruptors, whether they’re small or large, create opportunities to move your team ahead through change management. It is essential to have a team to believe in and work towards the same goals to capitalise on this fast pace industry.

Downtown Toronto, by all accounts, has become the tightest office market in North America and might
be getting tighter despite new supply. What is your take on this statement and what would you recommend to tenants?

Our projections show that the market will continue to tighten for tenants. Relief will be available for tenants in 2021 after new developments at 81 Bay Street and 16 York Street are delivered and tenants vacate older buildings to migrate to the new developments. Of the 720 built properties in the downtown and midtown markets, only 29 can accommodate a user 30,000 square feet; that’s 4.0% of all properties. To put that into context, 30,000 square feet is approximately one full floor sized tenancy in any given bank building. Tenants are now starting their real estate exercises earlier than the traditional 12-18-month lease expiry outlay as a means of securing their future workplaces.

“Tenants are now starting their
real estate exercises earlier than
the traditional 12-18-month lease
expiry outlay as a means of
securing their future workplaces.”

What are your thoughts on coworking and how has it added or taken away from the Toronto market?

Fixed vs flex, the world of commercial real estate is changing quickly. As advisers, we look at coworking providers and flexible providers as a solution to our clients’ business needs. Flexible providers are changing the landscape of our industry and this is disrupting traditional ideology. Giving people more choices about how and where they work - now that’s exciting! Today, flex space represents less than 1.1% of Toronto's overall market and when compared to other places like London and Manhattan, which reported 5.1% and 2.1% respectively at the end of 2018, we still have room for growth.

One example of a young tech firm navigating the challenging office market due to exponential growth in a short period of time is Colliers’ tenant, Peninsula Group - a provider of remote HR and health and safety services. Like many new entrants to the Canadian market, Peninsula began leasing coworking space at WeWork for their first 8 employees, which quickly expanded to accommodate 45 employees. After only ten months, the company outgrew their coworking space and needed to find a new solution. Today, they have secured over 17,000 square feet of office space in downtown Toronto for their now 180 employees.

Why is it important for tenants to consult a professional when faced with a complex issue?

Ten years ago, we asked our clients how many square feet they needed. Five years ago, we suggested we would save them money on their rental rates through negotiations and what type of space designed they wanted to complete tasks and activities. Now we are asking them what type of workplace they want for their employee experience. It’s no longer only about saving tenants money on a per-square-foot basis through negotiations with landlords. Real estate represents between 3% - 7% of most companies’ fixed operating budget. We can help save companies money by advising them on choosing the right location that helps increase productivity and helps retain and attract top talent.

With up to 90% of an organisation’s costs dedicated to human capital, companies need to consider the value of employee engagement and creating work environments dedicated to HOW employees work best within a space. Creating functional employee experiences (“EX”) within the workplace will help foster a high level of employee engagement. This nurtures a profound connection to the company and increases retention, enhancing the ability to drive innovation, increase profitability, and move an organisation forward.

Following the recent failure of a student housing investment scheme in Stoke-on-Trent, Peter Robinson, Joint Head of Property at Hunters Law LLP, examines the pitfalls that can be encountered in investing in 'off-plan' development schemes, particularly those involving leaseholds. Peter argues that buying 'off plan' is highly speculative and, therefore, high risk.

Investing in a commercial property development scheme has a number of risks associated with it. Some of these are illustrated by the problems being encountered by private investors in a student housing project in Stoke-on-Trent[1].

The scheme involved the developer selling long leases of individual rooms in student accommodation for capital sums and relatively high ground rents subject to review at five-yearly intervals throughout the term of the lease. Each investor then granted a sub-lease of his or her room to the management company (which appears to have been connected to the developer)[2].

The grant of nearly 200 leases on this basis generated for the developer [3] :

• capital receipts of several millions of pounds; and
• an annual ground rent income stream of nearly £150,000 which allowed the developer to sell the freehold for over £2.8 million.

In October 2018, investors failed to receive from the sub-tenant company the “additional rent” due to them under the sub-leases that they had granted. After a further default in making these payments, the sub-tenant company was put into administration[4].

The administrators subsequently advised investors that[5]:

• the management company had not generated enough income to pay the additional rents representing the returns to investors under the sub-leases;
• investors would have to fund payment of the rent and service charge payable under their own leases; and
• to enable the administrators to continue the process of administration the investors would have to waive their right to receive “additional rent” until all other necessary expenses of the administration had been paid.

This has frozen returns on the investments made in the scheme, at least, until the scheme is re-structured to generate an appropriate level of income.

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In order to minimise the inherent risk of collective investment of this type, an investor should understand:

• the criteria for making the project a success (in a student housing scheme the criticality of opening at the beginning of the academic year); and
• the process of realization of the project and the associated risks.

Buying into such a scheme 'off plan' is speculative and, therefore, has a higher than normal level of risk. In particular:

• a number of individual units will need to be completed (on time and within budget) to make the whole development viable;
• a lease is both a wasting and, potentially because of the landlord's right to forfeit for non-payment of rent/service charge, vulnerable asset; and
• there are cost, timing and quality issues, particularly in a specialist sector such as student accommodation.

Engagement of appropriately experienced professionals to advise on making such an investment is a key part of a successful strategy for investing in such a scheme.

The benefits of such engagement in managing the inherent risks are:

• The standards which a professional must meet in order to have satisfied the duty of care owed to a client are high and, not meeting those standards would lead to the client having a claim for negligence against that professional; and
• A good and experienced solicitor/surveyor should be capable of identifying and advising on the potential risks of the scheme and, most importantly, be capable of advising the client not to proceed with the investment or, at least, not on the terms offered.

Informal collective investment property schemes are currently only loosely regulated and disaffected investors will, generally, not be able to obtain redress for lost or impaired investment from the state. Prudence, research and preparation before investing is such schemes is, therefore, imperative.

Sources:

[1] "How a £100m student accommodation scheme went wrong. Thomas Hale – July 3 2019 – FT Alphaville : https://ftaphalphaville.ft.com/2019/07/03/15562130014000/How-a--100m-student- accommodation-scheme-went-wrong/ 

[2]  Paragraph 3 of A1 Properties (Leicester) Limited (In administration) Statement of Joint Administrators' Proposals Pursuant to Schedule B1 of the Insolvency Act 1986 of 23rd April 2019 – Companies House.

[3] Register entries for HM Land Registry Title Number SF514607

[4] Paragraph 3 of A1 Properties (Leicester) Limited (In administration) Statement of Joint Administrators' Proposals Pursuant to Schedule B1 of the Insolvency Act 1986 of 23rd April 2019 – Companies House.

[5] Paragraph 5 of A1 Properties (Leicester) Limited (In administration) Statement of Joint Administrators' Proposals Pursuant to Schedule B1 of the Insolvency Act 1986 of 23rd April 2019 – Companies House.

Nine out of ten young people want to buy a house, but recent analysis revealed just one in four will achieve it by 2026. From partnering up to selling prized possessions, people are resorting to to secure their place on the property ladder.

If you’re one of the lucky ones and you’ve finally managed to rustle up a deposit, you might be wondering: what’s next? After all, it’s easy for tunnel vision to set in when your eyes are on the prize for so long.

There are lots of other practical things to consider when you buy your first home. Here are eight of the most essential:

1. Mortgage options

All mortgages are not created equal, so the deal you find can make a big difference to what you can afford. Always seek mortgage advice – it’s important not just to find the best interest rates, but also because you’ll get a more accurate picture of what you can afford.

Factors like your income, whether or not you have a partner and both of your credit scores will affect the amount you can borrow. Online loan-to-income calculator tools can help, but it is always better to seek professional advice.

Make sure yours is independent, so they won’t try to sway you towards a particular product.

2. Solicitor fees

If you thought saving thousands of pounds for a deposit was enough to secure the keys to your very first home, you may be in for a shock. There are lots of other costs to cover – including solicitor’s fees.

The average cost of solicitor fees for buying a house is between £500 and £1,800 in the UK but this depends on how complicated the sale is. If your solicitor comes up against complex ownership structures, the charge may be higher, so always set a budget aside for this.

The average cost of solicitor fees for buying a house is between £500 and £1,800 in the UK but this depends on how complicated the sale is.

3. Life insurance

Buying your first home is an exciting time; death isn’t part of the plan. But, taking on a big financial responsibility means you need to plan ahead. This is especially true if you are buying with a partner: if they died, would you be able to foot the bill?

Purchasing life insurance is an important part of taking on a mortgage. Compare all types of life insurance to make sure you understand the best options for new homeowners – like decreasing-term insurance.

4. House insurance

Some mortgages require you to take out a house insurance policy as part of the deal, so this is also part and parcel of becoming a homeowner. Buildings insurance protects both you and your mortgage provider against the risk of damage to the structure of your home from things like subsidence, fire and extreme weather.

Always take out a buildings insurance policy to cover the potential cost of rebuilding your house after severe damage.

5. Protecting your deposit

Many couples buy their first homes together because it is so much more viable than going it alone. Your combined income is much higher, you pose less risk to lenders and you’ll be able to save for a deposit worth twice as much. This reality is attracting more friends and acquaintances than ever to buy a house together – a decision that can come back to bite unless the right preparations are made.

Instead, consider setting up a Declaration of Trust so that you will become ‘tenants in common’ and hold specific shares of the property. Speak to your solicitor about the options.

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6. Booking a surveyor

Homebuyer surveys help you to avoid unexpected costs. When you consider that the average cost of a boiler is now as much as £2,500, this is not a step worth skipping.

To find a reputable surveyor, enquire at an association like RPSA or RICS.

7. Stamp duty

They say two things are certain in life – taxes and death. Stamp duty is the tax you pay when buying a new house and it’s an important consideration for first-time buyers.

There is no stamp duty for properties worth less than £300,000, but if you’re a first-time buyer in London or the south-east, you might need to factor in a significant tax bill. Rates can be as high as 5% – which is a significant sum of money.

8. Negotiation

Finally, don’t forget negotiation. When you have had your eyes set on a goal for so long, you may be tempted to offer the full asking price – but this could be a mistake.

Keep an eye on the market and don’t be afraid to renegotiate after your surveyor creates their report. This way, your new house can be a great asset as well as a cosy new home.

Despite the uncertainty, the need to find secure and stable income is still a priority for investors and Europe’s real estate industry does offer substantial potential to achieve this in 2020, even as it moves through the ongoing late cycle. Investors are certainly seeing potential in the logistics sector, for example, which has been expanding for some years now, thanks to increasing urbanisation and the continuing growth of e-commerce driving the need for the provision of first-rate distribution centres.

The offices sector is also growing as central business districts are developed in several major cities across Europe while it is no surprise that German cities are regarded as investment hotspots by global investors, who value the safety afforded by scale, liquidity and growing markets. The same applies to Lisbon because of its attractive development and investment opportunities. Additionally, increased investment flows are expected to come from Asia, and especially Japan.

But with the wider economy slowing, the reality is that although global investors remain positive about real estate, there are familiar concerns surrounding the scarcity of attractive assets. Indeed, most markets are certainly quieter at present than this time last year. Although European real estate remains highly liquid overall, expectations are lower regarding the availability of equity and debt as the industry navigates the late-cycle.

Global investment opportunities and changing attitudes

At present, investors are faced with the challenge of how to effectively deploy capital and keep a sustainable cash-flow because of the increasing demand, and therefore prices, of European core real estate assets, which are perceived as safer in the current environment. Several investors are also adopting a build-to-core strategy as an alternative approach to generate income, while alternative real estate assets and residential properties are also being considered as additional investment options. This demonstrates an industry that is slowly challenging traditional investment norms and looking at real estate more broadly while acknowledging possible risks.

Asset owners will need to adapt their assets or convert them to meet changing demands.

Downturn is likely to be relatively gentle

Although the end of the investment cycle does appear to be approaching, the slowdown is likely to be a gentle one. It is unlikely to be as severe as the one seen in 2008, which was caused by a rare, seismic event. And when the next downturn does occur, markets are likely to make a quick recovery.

Investors are sharpening and improving their investment strategies to prepare for the stuttering growth and end-of-cycle risks, though. They are diversifying the economic drivers to which their portfolio is exposed. For example, investors are now considering investing in the alternatives and residential assets as mentioned above. Investors may also decide to invest in multiple sectors rather than one. This does not mean that their views of the real estate sector have changed; they are simply taking precautions by acknowledging that now is not the time to make huge investments.

The fact that the Eurozone is currently regarded as a safer investment destination by global investors still holds true with some chronic challenges. Pricing and scarcity of attractive assets are still the major challenges for investors. This is only exacerbated by the economic uncertainty and geopolitical events in some European markets, and the ongoing decline in consumer confidence.

Technological trends in the sector

Apart from the end-of-cycle warning signs and the decline in consumer confidence, another factor that investors need to consider is technology, which is driving change across all industrial sectors, not just real estate. Mobile technology has major implications for the retail sector, while the concept of driverless cars has raised the prospect that parking structures may well be converted to office or retail spaces in the future. People’s attitudes on how they occupy space continue to change: the advent of the co-working and co-living concepts are having a dramatic impact on the real estate industry. According to a report by PwC, the shared office space market is now going through a revolution, with co-working offices on the rise and likely to account for 30% of corporate office portfolios by 2030.

The Eurozone’s performance in real estate over the last year has been weaker compared to two years ago because of a decline in yields.

Challenges and opportunities ahead

For many asset managers, rapid technological changes are threatening to make some assets obsolete. Asset owners will need to adapt their assets or convert them to meet changing demands. This is more apparent in the retail sector as the number of physical stores continues to decline. To remain competitive, real estate owners will need to become operational businesses and develop new skills. They will also need to be able to understand and meet different consumer needs and expectations.

Virtual data rooms offer key benefits to the real estate sector

But one technological development that offers major benefits for the real estate sector is the use of virtual data rooms (VDRs). It enables investors to take full advantage of market opportunities by enabling them to respond quickly. This is essential if they are to avoid the risk of missing out on a favourable sale. Just one missing document can sometimes block an entire deal, for example.

With Drooms’ VDRs, all incoming documents are indexed appropriately thanks to its ‘auto-allocation’ feature. Business processes such as mergers and acquisitions, commercial real estate sales and non-performing loans can be conducted securely, efficiently and transparently through Drooms TRANSACTION. Using this tool, authorised personnel can have controlled, online access to confidential data that are stored remotely. Additionally, our latest product Drooms PORTFOLIO facilitates intelligent and secure portfolio management of multiples assets throughout the hold phase, allocating bespoke data rooms to individual assets on a single platform. Its “transaction flag” functionality enables parties with admin rights to search and mark transaction-relevant documents for readiness.

VDRs also offer a solution to coping with the rise of ‘big data’, which represents one of the most significant challenges facing real estate market players. By tapping into big data, investors can enhance their decision-making across supply chains. But failure to do so, i.e. by not adopting the right technology, can lead to a severe loss in their competitiveness.

Yields are still attractive in Europe

The Eurozone’s performance in real estate over the last year has been weaker compared to two years ago because of a decline in yields. Nevertheless, global investors still see Europe as a haven for investment opportunities while expecting major disruption in Asia. The yields may have declined but they are still favourable versus the low-interest rates prevailing elsewhere and, despite the inevitable slowdown, there is still strong demand from investors for the right deals and investment strategies. Investors just need to remember that the right technology will be more indispensable than ever when the inevitable slowdown occurs.

This has especially rung true for the British high street in recent years, with retail centre footfall having fallen almost exclusively between January 2017 and March 2019.

Whilst the future prospects for high street retail may initially seem bleak, there is nonetheless good reason to believe that there is light at the end of the tunnel. In this article, Jason Wood, Head of Commercial Property and Rashid Ali, Partner at UK law firm Smith Partnership, take a closer look at the role of commercial property in the age of high street decline.

Is High Street Retail Really Nearing Death?

Headlines announcing 'the death of high street retail' have become commonplace in the public arena, and there is definitely significant evidence to suggest that the high street is at least feeling the pressure.

The number of people purchasing goods and services online is expected to increase from 1.66 billion in 2016 to around 2.14 billion in 2021. Overall, ecommerce sales already accounted for more than 14% of global retail sales in 2019, and forecasts are tipping it to grow further towards 22% in the next four years alone.

Although these figures do not necessarily mean that digital consumers are shifting their focus entirely towards the online sphere, the trend undoubtedly represents a threat to traditional retail businesses. That observation is backed by the numbers, with the closure of UK chain stores having led to a decline of 6537 stores in 2018.

It's not all bad news, however. Amidst this general downturn, takeaways, sports clubs, pet shops and specialist clothing stores are just some of the retailers that have posted a net gain in store numbers during the first half of 2019.

Retailers' Response

As online sales continue to grow, retail businesses have begun to adapt and diversify their approach. Aside from making their own move into the online market, retailers have found many new ways of safeguarding their commercial longevity. These could range from practical steps such as selling assets and large-scale reorganisations to focusing on the delivery of a more immersive brand experience.

Although the former approach may be seen as a necessary consequence of the changing retail environment, the latter steps may well be the ones that help reimagine high street retail in the 21st century. The presence of physical stores will always be the main distinction between online and offline shopping, and retailers are faced with the challenge of playing to those unique strengths in a future-oriented way.

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What About the Commercial Property Sector?

Retailers aren't the only ones having to adapt to this brave new world – the commercial property sector has its own role to play in shaping the direction of the UK high street.

Store closures affecting both small businesses and high-profile retailers have made it harder for property investors to make the most out of their brick and mortar assets. Instead, many of them are faced with vacant space and reduced rental yields.

Unsurprisingly, commercial landlords whose portfolio is heavily focused around retail space are being hit hardest by the struggling retail sector. Rental cuts and company voluntary arrangements (CVAs) are at the order of the day, forcing landlords to rethink their strategy.

Commercial landlords whose portfolio is heavily focused around retail space are being hit hardest by the struggling retail sector.

Much like retailers themselves, diversification is often at the centre of that new approach. In some cases, this calls for nothing more than the repurposing of one retail space into another – as more and more shopping goes digital, retail warehouses continue to retain their importance.

In other cases, commercial property investors are moving into an entirely new direction. Opportunities in residential property, build to rent, flexible office space and other areas mean that landlords still enjoy many avenues through which to pursue commercial success. If the decline of the high street has taught us anything, it's that adaptability is central to achieving that goal.

In order to ensure longevity, developments can no longer be based solely on office or residential use. A greater focus on multi-use, the environment and more flexible lease structures can go a long way in shaping spaces that occupiers wish to remain in, helping landlords guarantee income in the long term.

The commercial property sector is also responding to these changes through moving away from retail-led and transactional high streets. There is now a greater focus on experience and the blending of retail, leisure and culture into a single space. The future of city centres lies with being more than just a place to shop; they are set to become community hubs where visitors can shop, eat, visit and explore to their heart's content.

In the face of such developments, landlords themselves are also having to alter their approach. Commenting on the changing role of the commercial landlord, Smith Partnership's Wood and Ali said:

"Landlords focused on providing long leases at high rents are likely to struggle for survival in the long-term. In their place, landlords who take a more active role in the management and performance of their tenants are likely to become the new norm. As such, commercial landlords are steadily settling into a new role as the curators of the high street, considering which businesses will thrive in their space and supporting them in doing just that."

A New Horizon

With changing consumer behaviours continuing to have a significant impact on the UK high street, the time has never been better to carve out a new way forward.

Although retailers and commercial landlords will undoubtedly face further challenges in the years to come, there is also a wealth of new opportunity on the horizon. Those who are able to capitalise on it successfully are set to play an instrumental role in shaping the path ahead.

When it comes to property investment in the United Kingdom, Simon Nosworthy of Osbornes Law Firm believes that the housing market has already pre-adjusted for Brexit, according to The Sun. Investors who decide to pick up properties before, during or after Brexit may be grabbing bargains that they can sell for big profits when the market recovers.

While property investment in the UK is currently subject to a lot of uncertainty and has its pros and cons, there will be investors who read the property investment landscape perfectly and then make a mint.

Look at the bright side

Buying property has many advantages (capital growth over time and/or rental income), provided quality properties in good locations are chosen. The UK real estate market shifts, but savvy investors know when to get into the market and when to get out. Since prices have dipped a bit due to Brexit uncertainty, there are valuable properties available which are cheaper than they normally would be. These properties may increase in value once Brexit issues are finally resolved. Whether you’re interested in buying a home or flat and renting it out to make cash, or investing in commercial real estate, the silver lining in Brexit uncertainty is that deals are out there. If you’re interested in buying, know the risks and choose a property or properties with the utmost care.

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Know the risks and choose carefully

To boost the odds of a successful property investment, you should examine prospective properties with a fine-tooth comb. Properties should be in locations that are in demand or growing more popular. Properties should be in good condition, and tests will be needed, as visually inspecting a property on your own isn’t enough. It’s wise to pay for surface and air inspections that determine whether mold is present. You should also pay inspectors to determine whether homes or commercial properties have other issues, such as structural defects or water damage. Mold remediation is possible and should not break the bank, but issues with structural integrity and water damage may cost a lot to fix and cut into profits when you resell.

Prepare to be patient

Short-term flips are always an option, but current real estate market conditions point to playing the long-term property investment game. Buy undervalued properties on the cheap and hang onto them, so you can make good money when you sell them once the Brexit dust settles. Rent a property while the UK adjusts to a new reality, and prepare for the future: when the market rebounds and you’ll be able to sell with great results.

The pros of UK property investment in the age of Brexit, such as lower real estate prices and the possibility of big profits in the future, are balanced by the uncertainty and risk that Brexit brings. Weigh the pros and cons before making a play in the real estate market.

Importantly, the political situation does not accurately reflect the current state of affairs in other sectors of the economy. Jerald Solis, Business Development and Acquisitions Director at Experience Invest works closely with international investors, and he says it’s reassuring to see that UK property, be it commercial or residential, is still held in high regard.

In the first half of 2017, and less than a year following the EU referendum, the UK made up 14% of global commercial property investment transactions. This was second only to the US and tells us that international investors evidently were not letting the prospect of Brexit impact their long-term real estate investment strategies. Meanwhile, total investment volumes into the UK’s multifamily residential sector rose by more than 150% to reach $7.6 billion in 2018.

So, what is it about UK property that holds global interest even at the most challenging of times, and how can international investors use Brexit to support their long-term financial goals?

Why does interest in the UK market hold strong?

Currency fluctuations in the wake of the Brexit vote has had a significant influence on investment decisions. Since June 2016, the value of the pound has steadily fallen; as a result, overseas investors have found themselves enjoying more buying power, particularly within the prime property market.

With a weakened pound, overseas investors have been in the position of being able to snap up UK properties at discounted prices. According the HMRC, for instance, there was a 50% spike in the number of UK homes sold for over £10 million in the year following the vote.

The Bank of England has also cut interest rates to historic lows, encouraging investment in real estate assets. The interest rate has been held at 0.75% since August 2018, with little indication of this being raised in the near future.

Diversifying opportunities

While foreign interest in the market remains, investors’ strategies have been changing in response to Brexit. Namely, the variety of opportunities now on offer means that investors have been looking beyond the traditional remit of property investment in the UK to explore new cities and sub-sectors that offer the potential of long-term capital growth.

Historically, London has been the destination of choice for international investors. However, in recent years, investors have increasingly recognised high-growth cities and leading business destinations like Manchester, Liverpool, Leeds and Newcastle.

This is something we have witnessed first-hand at Experience Invest. Indeed, Manchester and the other so-called Northern Powerhouse cities have attracted some of the highest levels of Foreign Direct Investment of any UK region outside of London according to research from Ernst & Young.

It should come as no surprise then, that house prices in Manchester have surged; in the 12 months to July 2018, house prices rose by nearly 9%. Meanwhile, enquiries by Chinese investors alone about buy-to-let options in the city soared by 255.6% in January 2018 compared to the same month in the previous year.

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Cities like this, which are undergoing rapid regeneration, have been clear favourites in the aftermath of the Brexit vote. The reasons for this are clear; with prices in such areas typically below those seen in the capital, rental yields and capital appreciation forecasts tend to be markedly stronger.

Indeed, such cities are also home to a large student population, representing huge demand for year-round accommodation and good long-term investment prospects. This translates to another trend taking hold. Namely, overseas investors are beginning to diversify their assets, looking towards options such as Purpose-Built Student Accommodation (PBSA) that cater to growing demand for term-time accommodation. Indeed, overseas investors dominate the UK PBSA market according to Cushman & Wakefield, making up 55% of 2018 transactions.

The UK’s proven track record for delivering high-quality real estate leaves us in no doubt that international investors will continue to target the UK, albeit perhaps with a different approach. Particularly with a heavy investment in regeneration projects up and down the country, the improvements in infrastructure and connectivity, as well as the delivery of sought-after new-builds, means that the UK property market will remain a top target for investment – even if it does naturally experience an immediate post-Brexit wobble.

Tracking 65,384 property sales between August 2018 and August 2019 from start to finish, the monthly updated local house market insights tool shows the average differences between asking prices on Rightmove and their actual sold prices lodged at the HM Land Registry.

It was revealed that, out of the 575 assessed properties in South West London, sellers were dropping their asking prices by an average of over £71,000 to secure a sale.  A similar story was seen in North West London, where 206 vendors reduced their initial prices by almost £69,000 on average.

Below are the top 10 areas with the greatest drops have been seen:

Property Solvers co-founder Ruban Selvanayagam commented: “Even some of the most experienced estate agents are failing to understand the current realities.” 

“Arguably due to the cloud of uncertainty surrounding Brexit, we’re operating in a buyer’s market at the moment and the fact that agents knowingly state exaggerated valuations at the initial stages is a disservice.”

Bearing in mind that prices in the South tend to be higher than in the Midlands and North, some of the lowest asking to sold reductions were seen in Wigan (-£3,890), Hull (-£4,258), Doncaster (-£4,705), Sheffield (-£4,884) and Sunderland (-£4,915).

Selvanayagam goes on to comment: “When we speak to homeowners, we always underline the importance of referring to HM Land Registry sold price data.  It’s never been easier to access this kind of information online.”

"Of course, it’s never a bad idea to incorporate a bit of wiggle room into the price.  Also, if a client has spent a significant amount of money on extending / refurbishing or there’s more floor space then, of course, it makes sense to command more.”

“However, overly inflated price valuations in the current sales climate invariably leads to properties lingering on the market for a lot longer than they need to.”

Do such disparities between asking and sold prices mean that the market is crashing?

“I would say not – although much would depend on the outcome of the seemingly endless Brexit negotiations.  A ‘no deal’ or disruptive exit from the European Union could, however, change the trajectory of house prices.  However, it’s too early to predict at this stage.”

First time homebuyers looking to purchase an abode for the future can look to six savvy tips from the conveyancing experts at jmp-solicitors.com.

Here’s a list of savvy tips for first time homebuyers.

1. Decide on a realistic budget

When purchasing a home, the deposit isn’t the only cost you’re going to need to cover. As well as the budget for a deposit, which will be around 5%-20% of the value of the home, there will be a number of initial fees such as the valuation fee and the surveyors fee, as well as the additional parties to pay such as the lender/broker fees (if first time buyer no estate agents fees) and the conveyancer. There is then the fees associated with the mortgage including the booking fee, arrangement fee and mortgage valuation fee. We recommend saving an additional £2,500 on top of your deposit to cover the costs.  Please be aware that if more than one person is purchasing and they have already owned a property then stamp duty will be payable even though the other person has never owned a property anywhere in the world before.

2. Find a suitable conveyancer

It’s important to find an experienced conveyancer who will provide a thorough service when you’re buying a home. Your conveyancer will be able to give legal advice, handle contracts, undertake important searches, deal with the Land Registry, and the transfer of funds. Many estate agents will recommend a conveyancer, but it’s important to undertake your own research to make sure you find the right one for your particular purchase. Ensure that they are certified by either the Solicitors Regulatory Authority or Council for Licensed Conveyancers or the Law Society.

3. Take extra care in filling out paperwork

Miswritten paperwork is a common cause of delays when it comes to buying your home. It is important to ensure you read all contracts in full detail and fill in all paperwork openly and honestly. Any incorrect paperwork could lead to a great deal of legal problems in the future. Taking a little extra caution when filling in forms and applications can save you a great deal of time in the long run.

4. Be patient 

While you may be itching to get into your new home, it is vital that all aspects of the process are dealt with thoroughly. Sometimes the conveyancing process may involve a lot of paperwork and additional enquiries, but it is important to understand that all the legal aspects are being done in your best interest as a first-time home buyer. Aside from conveyancing, the mortgage arrangements, estate agent negotiations and the actual moving in process will also take some time.

5. Uphold good communication with your agents

Ensure you are always kept in the loop with the seller, your estate agent, mortgage advisor and conveyancer. When you have decided on a property, you want the process to be as smooth and hassle free as possible, so don’t be afraid to keep pestering your agents. In the same way, make sure to keep your phone on at all times in case you need to be informed of any major turning points. Additionally, keep up to date with your emails, including checking your junk, as conveyancers will often send over documents via email.

6. Ensure you are fully satisfied with your final arrangements and negotiations

For first time home buyers, you may go into a contract not fully understanding what is in your best interest. Your conveyancer will be able to provide you with the best possible advice to ensure you get the best deal for the short and long term. If at any time you are not satisfied with your agreements, it is vital you speak with your conveyancer and they will endeavour to resolve any issues before it is too late.

One needs to understand the industry before jumping into its business. Many things that look easy on the outside will surprise you when you get to their implementation. You should have a few resources beforehand if you are to start a property development business.

Make Sure You Know the Industry

People say you need money to start a business. Most successful entrepreneurs disagree. They say you need to have skills like no other to start a business, and the investment will come to you. Make sure you are worthy of running a successful business before you worry about finances. Learn everything there is to know about the industry you plan to target. For that, you may have to do a job, work as an assistant, or join a study course. When it comes to property development, you need to understand every corner of it. Start the business only after you are certain that you have explored the entire industry.

Arrange Investment

Once you are confident that you can run the property development business, it’s time to prove it. Your skills will be tested and there will be money on the line. You either have to invest your own finances or get a loan. It’s best if you have your own investment because that way you don’t have to answer to anyone. On the other hand, it won’t be a problem even if you don’t have the finances. As I said, the

investment will come to you if you are skilled. Anyone would agree to invest with you when they know you are not going down. You can get development finance from Property Finance Partners for your business. It is a property finance company that provides real estate raising finance solutions in the UK.

Keep Contact with Suppliers

A professional network is your net worth. You need to have contact with every supplier related to your work. You should also understand every service and product that you will use and their current value in the market. As a property developer, you may need services of builders, electricians, painters, architect, carpenter, plumbers, decorators, and interior designers. Having a reliable relation with these professionals will give you confidence and allow you to meet deadlines with quality work.

Understand Your Target Market

You should have a full understanding of your target audience before investing in a business. You should know who will need your services, how they will approach you, and if there is any space for you in the market. It can be difficult to survive in a market with fierce competition. Likewise, you should also know the right time to penetrate the market and when to take a break. Having an audience persona in your mind will help you better target your potential customers.

Use Digital Marketing

Marketing is important to make an entrance in the industry. While many property developers may underestimate it, digital marketing has helped many new entrepreneurs build their business. Use every marketing tool to get an edge over your competitors. Once you understand your market, targeting potential customer becomes easier.

Digital marketing doesn’t need you to have an office, you only need a website and a few social media profiles. You will reach out to potential customers through these channels. It’s also a great way to enter the market because it lets everyone know that you exist and now offering your services. Portray your skills and unique selling point on the internet. See what your audience is expecting from your industry and provide them an easy solution for that.

Build a Reliable Team

Every businessperson needs a team that he can rely on. The team builds the foundation of a business. If your foundation is strong, you are likely to survive in the market. Property development business doesn’t necessarily need a team if the leader is skilled enough. You will need the expertise of an accounting professional with the knowledge of all legal matters to understand and control all expenses. A project manager can divide your responsibilities and ensure that all development on site is in order. Moreover, you may need someone who understands the field to be on the lookout for opportunities.

Deciding Your Property Sector

A property business developer should know every sector of his industry. He should further understand the requirements of each sector where he wishes to operate. Whichever sector you choose, you will need to follow its every news and update. By specializing in just one sector, you are more likely to dominate it. You will know what, when, and where to buy, sell or rent a property. You will be able to make more sales by telling customers exactly what they want to hear if you focus on just one type of audience.

With the current average UK rent at £934 per month according to HomeLet, Bunk looked at what you can typically get for between £900-£1,000 and how it differs across the UK.

Studio flat, Brixton - £900 pm

Of course, £1,000 won’t get you much in London space-wise, but it will get you a studio flat in either South Kensington’s sought-after Gloucester Road, above Walthamstow’s famous Bell pub or in a gated Tudor style development in Brixton fit with a private pool.

One-bed terraced, Cambridge - £950 pm

In Oxford, you could secure a one-bedroom terraced house with scenic country views for £1,000 and in Cambridge you could also pick-up the same sized property for £50 less a month.

One-bed apartment, Granary Wharf, Leeds - £950pm

If you prefer apartment living, you can snap up a one-bedroom apartment in Gordondale House in Aberdeen, the Royal Parade in Bristol, the Mailbox in Birmingham, Granary Wharf in Leeds or the 32nd floor of the 47-storey Beetham Tower in Manchester.

Two-bed apartment, Mann Island, Liverpool - £950pm

If you’re looking to up your property potential and add another room, a budget of £1,000 can secure you a two-bed apartment in Liverpool’s waterfront Mann Island development, Nottingham’s historic Lace Market conversion, Sheffield's Victoria Quays, the unique Exchange building in the heart of Leicester, Clarence Parade in Portsmouth, a sea-front view in Bournemouth’s Honeycombe Chine, Cardiff’s old flour mill building Spillers and Bakers, Castle Chambers in Glasgow or Swansea’s Maritime Quarter.

Two-bed duplex, Oxford Street area, Southampton - £980pm 

Or, a similar budget would secure you a two-bed duplex in a grade-II listed building in Southampton’s trendy Oxford Street area, or a two-bed terraced with traditional features in Edinburgh’s Rosebank Cottages.

Four-bed terraced house, Lancaster Street, Edinburgh - £1,000 pm

Finally, for a budget of between £900-£1,000, you could rent a three-bed apartment in Compass House, Plymouth, fit with balcony and view of the marina, or a four-bed terraced house in Newcastle, close to Science City and the university.

Co-founder of Bunk, Tom Woolard, commented: “The UK rental market is home to a wide and wonderful variety of properties to suit all styles and it’s interesting to see just how the stock available differs when you take the same monthly budget and apply it to the various regional cities across the nation.

"Of course, you get a lot more property for your money when you look to the more affordable areas but that doesn’t mean you can’t find something with a bit of personality even in the likes of London, Oxford and Cambridge.  

"All too often, the speed at which property can let means that many tenants will settle for the first thing they find and are able to put a deposit on, but it can make a real difference to your life satisfaction in the rental market if you are able to find a property that you love to live in, rather than one you just choose to live in.” 

It is very likely to be the most significant purchase you ever make. Because of its long term ramifications, you want to take the process seriously. Below, the experts at Crawford Mulholland provide Finance Monthly with a simple guide to buying your first home.

1. Are You Ready?

First, you want to examine whether or not you are actually ready to purchase a home. Buying a home isn't something that you should jump into without proper preparation and knowledge. While owning your own home might sound appealing, it involves a lot of maintenance and ongoing work. When you own a home, you are responsible for paying all of the repairs and you are going to be responsible for paying for the respective taxes, insurance, and everything else. Because of this, you need to figure out if you are financially ready for such a leap.

2. Budget For Other Costs

You want to be sure that you are factoring in the costs that you might not necessarily be looking at initially. There are plenty of costs associated with buying your own home that you have to factor into your buying decision including but not limited to the removal costs, stamp duty, the initial furnishing, the survey costs, the solicitor's fees, and more. Make sure that you are factoring in everything when you are making a buying decision.

3. Shop For A Mortgage

Once you have decided that you want to go ahead and purchase a home, you want to shop around for a mortgage. This way, you will be able to minimise the interest rates that you are forced to pay on the mortgage. You will be able to search for some of the best mortgage rates online in order to find the best deal. You want to find the best deal because it will end up saving you a lot of money in the long run and you will need to look to see which type of mortgage would best suit your family.

4. Find The Right Property

When you are shopping around for your first home, you want to take the necessary steps in order to find the right one. Finding the right home is very important because you don't want to make such a large investment in something that you are going to regret later on. Take your time to figure out where you want to live and find a home that is suitable for you to live. You should be looking at the different properties in the surrounding areas that you would like to live to see whether or not you can find a place that you would love to call home. Don't rush the search process because it is going to dictate where you live for the foreseeable future. You want to factor various things in this process including how long the home has been on the market, why the property is being sold, and what is included in the sale.

5. Prepare To Negotiate

If you are going to be purchasing a home for the first time, you want to be prepared to negotiate. Without proper negotiating, you are not going to minimise the total price you end up having to pay for the property.

Overall, there are plenty of things that you can do to make the process much simpler. By following the tips above, you should be able to maximise your chances of finding a great home to purchase as a first time home buyer.