According to nationwide, one of the leading mortgage lenders, the property prices dropped by 1.7% in May to £218.902. This is the biggest monthly drop seen in the past 10 years since February 2009.
The Property Business was expected to be improving in the year 2020 as 'Boris Bounce' had given confidence to the potential buyers. However, when the lockdown was announced, like many businesses the property business was also affected, the house moves was banned completely.
According to Zoopla, around 373, 000 sales were suspended as a result of the lock down in March. These properties are worth 82 billion as reported by Zoopla website.
Although social distancing rules have been eased, and the property market is open again many people might still be reluctant to do all the viewings as they are scared that the second wave of coronavirus might strike. Many are revisiting their properties due to financial constraints.
Despite the reluctance it is also seen that the demand to buy houses is increasing, this is because during the lock down many people have realised that they need more indoor space, some may feel they need more garden space and some may even consider renovating their houses. For instance Guardian reported that Andrews, an agency with 48 branches in the south-east, says it received 226 calls about viewings and valuations within the first hour of opening on Wednesday. The inquiries covered sales and lettings.
Something needs to be done to capture this market. If effective business models are not used it is feared that many property dealers will go into insolvency. The government has also revealed significant changes to the insolvency policy so that the struggling estate agents can be restructured.
The Estate agents should change their business models which can improve their sales in this time of crisis and meet the demands of the market.
- Using Technology to do Virtual Viewings: Virtual viewing is a 3D image of the property that can be viewed in a virtual reality system. Each room can be walked through with a 360 degree orientation. Right Move expected that that the digital viewings will remain popular. This will increase the audience who can view the house from the comfort of their home while maintaining the social distance. It is estimated that it takes around 25 viewings before a house is sold. Virtual viewings will help reduce the fuel costs of the employees as well as save time for other work such as customer service.This can definitely make the business efficient.
- Using Drones to take property picture: Drones can be used for commercial as well as residential property. Drones help take some Ariel images, these can be used in both 360 degree panorama view which will improve the marketing. Using drones will also help maintain a distance with people as provided in the guidelines by the government while taking pictures from different angles and perspectives.
- Reducing the Cost of the Offices: If the estate agents use this technology employees will be able to work from home reducing the costs of the offices.
By investing in the above will definitely improve the sales and will also help in the continuity of the business. However as each business is different a Business analysis should be performed as to measure the costs of investing in this technology and the benefits
We at Taxaccolega are professional accountants based in Croydon and Southhall. If you are a tenant, estate agent or a landlord we can help manage your finances. Please do not hesitate to call us 020 8127 0728