Bristol & London Share Discussion Threads

[westcoastrich] 13/11/2008 09:10

From The Times
November 13, 2008

Thousands of jobs under threat as estate agents begin fight for survival
Angela Jameson






The jobs of up to 15,000 estate agents are under threat if house sales show no sign of recovering, industry experts fear.

Since the property market peaked in July last year, between 5,000 and 7,000 estate agents have lost their jobs, either through employers' staff cuts or through resignations as employees struggle to live on a basic salary without commissions.

With housing sales down 50 per cent, industry estimates indicate that as many as half the country's 30,000 agents could be looking for work before any sign of an upturn occurs in the housing market.

Chris Wood, president-elect of the National Association of Estate Agents, who owns an estate agency business in Helston, Cornwall, said: "If you take the worst-case scenario that housing sales have fallen by 50 per cent, then you would expect the industry to lose 50 per cent of its people. It's something of a Darwinian process. Although there are, sadly, some very good firms going to the wall, most of the ones closing are those that came in at the height of the boom that didn't really know their business."


Countrywide, Britain's biggest estate agency and the owner of the Mann, Bairstow Eves and John D. Wood businesses, is the latest agency to attract concern after Standard & Poor's downgraded Countrywide's credit rating, saying that it could run out of cash in the next 12 months.

Grenville Turner, Countrywide's group chief executive, wrote to the compay's 8,000 staff yesterday to reassure them that the business was robust. "At the end of [the third quarter] we had around £106 million of cash on our balance sheet to protect us from the impact of this market, which I suspect is more than all of our competitors put together. We intend to keep it that way," he wrote.

However, he told staff that the company would continue to take tough decisions to close offices and reduce staff numbers, to make sure that it remained viable.

Other high-profile estate agency names have had problems, including Humberts, which was the first leading estate agency business to collapse over the summer. Halifax has closed 50 of its estate agency offices, while other local names around the country have been forced into mergers, administration or liquidation.

Jeremy Helsby, chief executive of Savills, said: "If the volume of sales continues to fall, there is simply not enough business to go round. If sales are down by 50 per cent, then there will be 50 per cent less income."

Savills has already let estate agents and surveyors go, but it will not confirm the full extent of departures. It has closed one office outside London and is considering the possibility of closing more.

Yet Savills, like other estate agency groups, is reporting strong growth in its lettings business, particularly in London. "There is a new breed of people renting, with people who have sold their properties sitting on the fence hoping that values will fall further," Mr Helsby said.

Foxtons, which was sold by Jon Hunt, its founder, at the top of the property market last year for £360 million to BC Partners, the private equity group, is considered to be vulnerable because of its high levels of debt. Its new owner is in talks with the bankers who funded the deal by putting up more than £250 million.

Sources close to the chain denied that it was experiencing difficulties, saying that it had enjoyed strong growth in its lettings business and had advertised recently for new recruits.

[moob] 09/11/2008 10:01

lol#




Mortgages - Professional landlords dominate buy-to-let sector - 05/11/2008

The buy-to-let business is increasingly getting out of the reach of new or first-time landlords, it has been revealed.

In a study of about 200 mortgage brokers in the country, it was found that in the third quarter there was an increase in the number of landlords seeking portfolio extension mortgages or remortgages.

In the same manner the number of first-time landlords applying for buy-to-let mortgages shrank to its lowest in recent times.

But experienced landlords now dominate the sector as they build long-term portfolios as opposed to new entrants to the market.

[jonc] 29/9/2008 22:18

Followed by


Speeling Speeling Speeling..............

[moob] 29/9/2008 22:06

New progs being designed "Reposession, reposession, reposession"

[moob] 29/9/2008 21:55

They know who they are.

[hsbcpremier] 26/9/2008 07:53

keep readin this stuff in papers saying that lending to buy-to-let landlords is higher-than to regular borrowers, i disagree with this nonsense. Papers are full of it again wrt brad and bing today

[energyi] 18/10/2007 12:04

Could this be the ruin of the buy-to-letters?

17.10.2007 by Merryn Somerset Webb

I appeared on BBC Breakfast last week with a buy to let investor who was convinced he was very rich. He had, he said, made £8m out of the buy to let boom. Further chat revealed that he had properties valued at £8m but £5.5m worth of debt. So he is on paper 'worth' £2.5m. You might think that sounds like a reasonable margin of error but I'm not sure its enough: property can turn nasty fast. Many of the reasons not to invest now (the main one being the fact that yields are lower than interest rates) have been widely discussed but here's one more reason to steer clear. Buy to let mortgages deals tend to contain little read covenants regarding the loan-to-value ratio of the mortgage. In a rising market this isn't the kind of thing borrowers take notice of but in a falling market they may find that it is the ruin of them.

It works like this. The loans allow lenders to periodically revalue properties (at the borrowers expense naturally). If the value has fallen and the loan to value ratio has, as a result, risen above the level required by the mortgage (say from 80% to 85%) the lender can then ask the borrower to come up with more cash to get it back down. The result, says my lawyer friend, will be that as capital values drop, buy-to-let investors will start to receive letters from the lenders along the lines of "Dear Mr Bloggs, I should be grateful if you would restore your loan to value ratio by sending us a cheque for £25,000".

This, most mortgaged-up-to-hilt investors will be utterly unable to do. The result? Panic selling and not just from the market's new entrants. People who have been in the market for more than a few years are keen to suggest that they will be immune from any drop in prices thanks to the equity they have built up. But most of them – the man I met on the BBC sofa included - have also bought new properties in the last year. If margin calls – for this is what they are - start coming in on these how are they going to come up with the cash? No one's immune.

/more:

[swaghorn] 26/9/2007 09:10

Anyone hazard a guess what they will buy back at? Between 15-17p at a guess. One interesting way of raising funds, float at 100+ and buy back at 15p a couple of years later!

[ntv] 25/9/2007 17:41

i don't know why they didn't form a hire club where you get a certain numbers of days in super cars each year
it would have helped useage and increased cashflow but perhaps they will do that when it is not a listed company

[xavico] 13/9/2007 10:26

Swag,
he may have to off-load and quickly. If he doesnt the share price could fall even further. I feel sorry for all the holders who've lost - it's scandalous the co. could let this happen. What are they doing and what are their advisers being paid to do?

[swaghorn] 16/8/2007 11:29

just noted an RNS last year saying Able plans to sell more of his shares to institutions this year to help liquidity!!! Cant see him doing that at 10p a share!!

[swaghorn] 16/8/2007 09:01

Granted the MD is a plonker, but this share price is madness. Surely for a Co making money, paying a divi this is far to low and the price doesn't cease to stop falling!. Now valued at 2.5 million on a turnover of 8.6 million and profit last year of 500k (previously a bit higher, but a large write down last year), it seem very undervalued...unless i am just trying to convince myself as i jumped into this one!

Think the reputation of this share within the market is also a big problem, as 'the old in out' says. Also the MD owning just under 90% of the shares doesnt help its tradability...but we can take comfort that he must be rather unhappy about how much his holding is now worth!
Oh well, to posh twits crashing more cars!

[xavico] 15/8/2007 15:43

the share price has been in free fall for some time and yet no news. It seems the mms think this business is no good. A huge disappointment/losses for the private investors. Who knows when it will stop or will there be an unexpected rns?

[xavico] 10/8/2007 12:12

The Old
It may not be for much longer- terrible share price fall. When will it stop?

[debaleb] 07/8/2007 09:54

5 years later and energyi is still booming out the same record.

PS That house the landlord bought 5 years ago has now trebled in price!

[wiganer] 07/8/2007 09:47

I spose that's why the thread title is "Buy-To-Let as dangerous as Dotcoms?"

[the old in out] 07/8/2007 09:46

Energy, you are on the wrong bb. This is a car hire co.

[the old in out] 07/8/2007 09:45

You dorks are on the wrong bb. This is not buy to let but a lost cause car hire company.

[energyi] 04/8/2007 10:48

lenders and brokers admit there are still some attractions to using residential loans to fund buy-to-let properties. One is that they usually allow larger amounts to be borrowed against a property's value – 95-100 per cent compared with a typical maximum of 85 per cent for buy-to-let. Residential loans also provide capital gains tax relief because no CGT is paid on the sale of a main residence. However, residential loans do not allow the landlord to claim tax relief on interest payments.

Rob Thomas, senior policy adviser at the Council of Mortgage Lenders, has been monitoring the disguised buy-to-let sector closely this year. He says: "Our advice is that if you are lying to your lender by using disguised buy-to-let you are effectively committing fraud and people who do that will often face the consequences, so the best policy is to be honest with your lender."

...more:

[energyi] 04/8/2007 08:36

BTL IS BIGGER THAN YOU THINK!
============

Concerns are growing that many amateur landlords have fraudulently used residential mortgages to fund their buy-to-let properties.

These so-called "disguised" buy-to-lets occur when landlords ? typically those with a handful of properties ? pose as owner-occupiers to obtain cheaper and more flexible residential mortgages on property they have little or no intention of living in.

The financial regulator has uncovered the practice following a recent downturn in the buy-to-let market. Stagnant or falling prices for some city centre apartments have led to a number of landlords trying to offload cut-price properties quickly at auctions. The Financial Services Authority (FSA) says analysis of properties sold at auction last year found that although many were commonly classed as owner-occupied by their sellers, 80 per cent were in areas where buy-to-let was prevalent, suggesting that many were ?disguised? buy-to-lets.

The FSA said that consumers abusing residential mortgages often did not understand the risks associated with the buy-to-let market and did not have alternative sources of finance to cover ?empty? periods when they were not receiving rental payments.

Landlords struggling to rent out their properties have also had to deal with a slowdown in price growth. The average price of a new flat increased by just 0.8 per cent between the second quarter of 2004 and the first quarter of 2006, according to the FSA, leaving many amateur landlords with poorly-performing investments. The FSA said the percentage of repossessed properties appearing at auctions had risen to 25 per cent in December 2006, up from just 8 per cent in February of last year. It believes this number could increase in coming months as higher interest rates bite.

BTL chancers scrutinised:

[energyi] 04/8/2007 08:34

Are the Builders signaling a 2008 UK Property Crash
- Link :



This new Video lays out the case for an impending slide in UK Property,
following the same pattern that the Builders and Real Estate are tracing out in the UK.

[the old in out] 31/7/2007 15:26

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