As if property prices weren't crazy enough, here's speed viewing
As the London property boom soars onward, estate agents are rubbing their hands and using new tactics to speed sales and sate demand. Select lists of eager clients, usually cash buyers, are drawn up, with SMS and e-mails informing customers of homes well before they appear on websites or windows.
Advertising executive Cathy, 36, is not happy. She and her partner have spent three months looking for a home for about GBP750,000 (HK$11.7 million) in Queen's Park, west London, all in vain. 'People are paying silly prices because there is high demand but no homes for sale. We might wait until it cools down,' she says.
If the market ever cools. Property is at a record high, with a price-to-earnings ratio of 6:1, the highest ever, all fed by reduced supply, rampant demand fuelled by foreign investors, rich arrivals, a good economy and city bonuses. Central London homes are forecast to rise 20 per cent this year. A GBP750,000 home last year is now worth GBP1 million. Last month, house prices rose 3 per cent.
Clive, a 40-year-old chartered surveyor, has been searching for a two-bedroom flat for five months. 'I sold my flat in two weeks, but everyone is panic buying. It's a bun fight.'
The bun fight is getting stickier, perhaps in part due to a new selling tactic: 'speed viewing', in which agents arrange to open up the home for a short slot on a weekend and invite buyers round.
Emma, a 38-year-old website manager, says: 'This is the third time I've bought, and I've never experienced this before. A lot of estate agents aren't bothering with individual viewings any more. They just pack everyone in at once, and if you can't make the viewing, bad luck. I'd guess 80 people were at the last one I went to.
Cathy agrees: 'You don't get to see a place properly. And it makes for higher bids as there's real, visible competition.'
Says Emma: 'If the place is remotely decent, then it usually goes to sealed bids. There's no point in even offering the asking price.'
Clive again: 'We get the nod from agents because they know we are serious, but there's still a queue at viewings. It makes things more urgent, and I'm sure it inflates the price.'
Hamptons, a mid- to upper-end estate agency, declares it imported the practice from Australia in 2002. It brands them 'open days'. 'It's a very successful business model,' says a Hamptons' spokeswoman. 'On open days we see a lot of people offering there and then over the asking price. It's good for the seller, too. It takes only an hour. No need to keep the kids under control or tidy the house for weeks on end.
'There are more open days now because there is high demand and low supply. This year there has been a 38 per cent rise in buyers but the stock of properties is down 50 per cent. Open days are an efficient way to show the few homes available.
'There are benefits for the buyer: they get to see the property at a convenient time, see it at their own pace, without the hard sell from an agent. And it forces them to make a decision. It is competitive.'
Clive is serious but has almost admitted defeat. He needs a flat soon because his wife is set to have a child. 'We'll probably end up renting,' he says.
But rents are rising fast, at 18 per cent a year, and now there are also speed viewings for potential tenants, spurring interest from the circling buy-to-let investor.
'We are victims of our own good luck, I suppose,' says Cathy. 'There's a blockage in supply, and we are part of it. We've made money on our homes and released the equity to buy another. But we aren't selling our old pad. We're going to rent it out.'
Cathy, landlord, meet Clive, would-be tenant.