PrimeResi talks to one of the bosses of top independent agency Aston Chase about entrepreneurialism, competition and the best house he’s ever sold…
- You founded Aston Chase 30 years ago this year; has the industry changed much since 1985, and if so, how?
So many major changes over a thirty year period!
The Internet has had a huge impact enabling companies like Aston Chase to have a global outreach significantly reducing the impact/relevance of a prime High Street position and/or foreign desks etc..
Valuation used to (somewhat bizarrely) reflect the number of bedrooms as opposed to the gross internal floor area.
Introduction of more compliance has been a good thing but more is still required…agents should be licensed.
Negotiators at so many companies are now little more than clerks processing portal/website enquiries…the art of selling and relationship building has been overlooked by many firms who have become complacent during an extended period of growth fuelled by international buyers.
- What’s your advice for achieving longevity in the estate agency business?
Hard work, integrity, a deep knowledge of your market, an experienced team of dedicated professionals, a personal service all combining to create an ability to add value for your clients.
Many of our team have worked for the company for 5-20 years so there is a real understanding and knowledge of the local market and familiarity both with our own client base and local residents.
Despite having only one office we employ 20 staff predominantly seated in an open plan space ensuring a good exchange of information and the ability to cross sell within our House Sales, Flat Sales and New Homes Departments.
- How do you see the future for full-service estate agency over the next 30 years?
The large multiples across the UK are facing challenging times with the growth of online estate agencies but it remains to be seen whether these services will, indeed, succeed in the long term based on the lack of any meaningful support throughout a transaction and concerns regarding both compliance and security.
Of course, the low fees will inevitably seduce vendors of properties particularly at lower price points but I suspect that most vendors and especially those of higher value properties will still want to be represented by estate agents with a thorough knowledge of the relevant market and by those firms who routinely screen applicants and accompany inspections both services of which are synonymous with ‘full service estate agency’.
- You describe the firm as ‘entrepreneurial’ and ‘property focused’, rather than a ‘high street’ agency; how does this set you apart from your competitors and which core areas of London do you cover?
We do not occupy a High Street position and have never displayed properties in our windows in a conventional fashion despite occupying prominent ground floor offices.
We intentionally set out to locate our offices on a main thoroughfare but did not want to align ourselves to a single area as would have been the case had we taken offices in say St John’s Wood High Street.
We see ourselves as agents of prime property rather than being a parochial agency only able to operate in a single market place.
Our non specific location gives us ‘license to roam’ and this has been particularly evident with the growth of our New Homes activity where we are presently handling schemes in Queens Park, Bayswater, Fitzrovia, Camden, Mornington Crescent, Marylebone, Maida Hill and Willesden in addition to our established core areas.
Our team endeavours to match enquiries with properties irrespective of the precise location as opposed to simply sending someone to see something that they have asked to inspect.
All the team preview everything we handle and whilst you obviously can’t ‘hard sell’ properties (nor do we attempt to do so) properties at this price point it is nonetheless fascinating how common it is for applicants to end-up purchasing something quite different to their original brief.
Our core areas are St John’s Wood, Regent’s Park, Primrose Hill, Little Venice/Maida Vale, South Hampstead, Belsize Park, Hampstead, Hampstead Garden Suburb, Highgate…many of our buyers start off looking close to prime central London but often end up purchasing further north where they invariably get more lateral space on larger plots the perception being that they get better value for their money.
- Which of these core areas would you say has undergone the biggest transformation over the last three decades?
Our core areas are predominantly Conservation Areas so arguably nothing too dramatic in architectural terms but over the years the ‘North South’ divide has become much less of an issue and fringe areas such as Maida Vale, Primrose Hill and Belsize Park have seen sharp price rises whilst Marylebone (the new Mayfair) has seen meteoric price rises over a very short period of time.
Regent’s Park is set to join London’s ‘magic circle’ of prime locations due to increased security and an influx of international celebrities which has not been missed by Christian Candy of Candy & Candy who is now personally resident in Regent’s Park and his firm are actively developing in the terraces encircling what many would describe to be London’s finest Royal Park.
- To what extent do you work with other agencies and how would you describe inter-firm relations at the top end of the market?
Quite a lot especially at the very top end of the market where many vendors or advisors feel somewhat obliged to instruct the likes of Knight Frank and Savills but often aren’t convinced and thus also want to instruct an agency who really knows the local market and who will work 24/7 in order to achieve a sale.
The inter-firm relations are largely very good or certainly cordial but as in every market, there are always one or two highly unpleasant individuals who are renowned for being arrogant, unprofessional and sometimes both!
Suffice to say, we attempt to avoid working with agencies who are not ‘our kind of people’.
- Are there any areas of PCL you consider to be overhyped/valued? Are there any pockets of value left?
Marylebone is probably peaking and will inevitably need some time to mature before kicking-on again but there is still growth to be found in Fitzrovia and ironically, we feel that parts of St John’s Wood still represent pretty good value…there is a huge variable in the area ranging from £1300 per square foot through to over £3,000 per square foot…these days it’s arguably more about the product on offer than the precise location but of course, when you can tick every box, the ability to achieve premium prices is greatly enhanced.
- One of your clients recently offered to pay the stamp duty bill on a £10m house on Brunswick Place (pictured below); is this something other vendors are talking about doing and how have the recent SDLT reforms affected the market in general?
I would say that the vendor of the property in Brunswick Place is the exception to the rule in as much as he was happy for us to go public (most vendors wouldn’t want to attract the attention of HMRC albeit it is perfectly legal to sell the holding company).
Nonetheless, many vendors of properties owned by companies are happy to sell the company although this presently has limited appeal to prospective purchasers due to the loss of tax free status on a subsequent trade together with annual payments required and of course, the property would need to be the sole asset of the company to be considered in the first instance.
As has been well documented, the recent SDLT reforms have had a major adverse impact on the prime central London residential market resulting in a significant reduction in the number of transactions (approximately 30% up to £7m and over 50% above £7m) and it would seem that most prospective purchasers are still struggling to come to terms with the amount of ‘lost’ money associated with a purchase particularly given that SDLT cannot be consumed within a mortgage.
Consequently, it is clearly affecting people’s ability to trade-up and similarly, ironically, it is encouraging many to simply stay put and invest in smaller units thus arguably making it even tougher for first time buyers.
- How high are vendors’ expectations at the moment and how are you managing them?
The Research Departments of the global brands have recently been far more forthright than in the past which has inevitably been picked-up by the local and national property press.
This data together with the irrefutable reduction in the quantity of transactions and our own measured advice appears to have got through to many of our clients who hitherto might have been forgiven for thinking that the London residential market was bullet proof.
Vendors are recognising the need to reduce asking prices to more realistic levels if sales are to be achieved and in many cases, this essentially means that the vendor is literally paying for the increase in SDLT.
At the super prime end of the market, significantly greater reductions have been required by those under pressure to sell as the Governments recent offensive aimed towards non-doms/off-shore buyers has certainly resulted in a sharp decline in the volume of top end activity.
- Which new developments and/or developers have you been most impressed by recently?
We love working with Londonewcastle who are design-led and produce great schemes invariably in vibrant areas…
‘Queens Park Place’ in Queens Park has been a great success (JSA with Savills) with only a handful of the 116 units remaining with physical completion not due to take place until the second quarter of 2016 and we were proud to be appointed by Derwent London (JSA with Knight Frank) on their fantastic development of ‘Queens’ (below), a luxury apartment building of 16 units built behind the original facade of a 1930’s Art Deco cinema.
In both cases, despite being the independent single office agency, Aston Chase delivered the majority of sales and this has been a recurring theme with all of our New Home activity…which probably partly goes to explaining why this area of our business is thriving.
We are very excited by our most recent launch of The Villas, off Goldney Road in Maida Vale which is a super scheme of eight contemporary houses (JSA Pilcher Herschman) within a secure gated cobbled mews developed by London Buildings Group the principal of which is Colin Serlin who, along with Harry Handlesman, are accredited with pioneering the loft-living phenomenon in London.
- Are there any forthcoming schemes that we should be keeping an eye on?
We will be launching ‘The Anello Building’ on Bayham Street, Camden (JSA Hatton Real Estate) early in the New Year, this is a fantastic Art Deco building formerly the home of the famous theatrical shoe makers Anello & Davide (whose past creations include stilettos for Marilyn Monroe and the famous Beatle Boot for a certain Fab Four) in which there are 22 loft style apartments developed by Warner Lofts and one further development to watch out for next year will be the launch of Chappell Lofts, (JSA Savills) the former Chappell Piano factory which is a truly remarkable loft building located in the heart of Camden (more a less opposite The Roundhouse) in which there will be some of the most exciting individual units to be launched onto the London market.
- Are there any standout buyer trends from 2015? What type of stock is most in demand at the moment?
As for stand-out buyer trends or the type of stock that is presently in most demand I would say that most buyers seem to favour instant gratification and this applies at all price bands. It is probably a reflection of how little spare time people have today and is indicative that they would rather spend more money paying for high quality end product as opposed to going through the hassle and expense (sometimes a false economy) of refurbishing themselves.
Properties (apartments or small houses) priced up to £2m have until, very recently, been experiencing the strongest demand in the areas covered by Aston Chase.
- Recent analysis by Knight Frank found that top-end buyers are increasingly becoming product, rather than location-led; is this something you’ve seen too? Which features are the biggest draws for HNWIs at the moment?
I touched on this earlier but I would add that lateral space in secure developments with amenities such as concierge, swimming pools/gymnasiums/leisure continue to be particularly attractive to HNWIs whilst traditional demands such as outside space and parking naturally remain important criteria.
- What are you predicting for the prime central London market in 2016?
A potentially tough year as greater supply aligned with less demand collide compounded by the Government’s various cooling measures…even more reason why vendors should value and embrace serious full service estate agencies!
On a somewhat less pessimistic note, London remains a tolerant, vibrant and sophisticated city which continues to attract buyers from all over the world, the French are (understandably) continuing to buy in London in large numbers and I have recently even sold high end properties to clients who had earlier moved to Switzerland for tax reasons but are now moving back to London primarily because they have become bored and on reflection, the quality of life means more to them than saving money!
- What’s the one policy change you’d bring in to improve the way the UK housing market works today?
Not sure if I am equipped to answer the question but from a personal perspective I would like to see all Estate Agents licensed and from a UK housing market perspective I would like SDLT to be switched to a sellers tax and I also think that Council Tax levels should closer reflect the capital value of the property.
- What makes a great estate agent in your opinion?
A combination of several ingredients but a great work ethic, integrity, enthusiasm, knowledge of your market and a certain charm need to be amongst them.
Of course, drive and a competitive nature are also essential to make it to the top of the food chain.
- What are your thoughts on the rise of online agents?
I think that I have essentially answered this question above albeit I would add that I suspect that the current ‘excitement’ around the rise of online estate agents will subside in the passage of time when vendors realise that they really aren’t actually offering very much at all beyond a referral service.
Having said that, objectively, the proliferation of online estate agents may well have serious implications on the level of fees that full service estate agents are able to charge especially at the lower/mid levels of the national market.
- What’s the best house you’ve ever sold?
It depends if you are asking about my personal favourite, the largest or the most expensive?!!!
My personal favourite was a beautiful circa £20m period home enjoying an elevated position overlooking Hampstead Heath with stunning far reaching views across London.
The largest was my sale of ‘Heath Hall’, The Bishops Avenue (below) ironically earlier this year (24,000 square feet) for Andy Panayiotou (it originally came to the market at an asking price of £100m) and I can’t talk about the most expensive as it was the subject of strict NDA (non-disclosure agreement) but suffice to say, it remains one of the highest prices paid for a private residence in the UK.
- What would you be doing if you weren’t an estate agent?
Tough question, I always harboured a desire to be a criminal barrister but I also have a love of gardens so perhaps a landscape gardner?
Notwithstanding the above, my friends and colleagues all tell me that I should be an upscale travel consultant as I have been fortunate enough to travel extensively and I always like to check-out the best properties and new openings etc.!
- Where and what would you personally buy tomorrow with a budget for a) £1m and b) £10m
Another tough question as I love my existing home but if I was in the market now with a budget of £1M – £10, at this stage of my life, I think that I would be very tempted to buy an apartment in Marylebone as I really do like the idea of having so many shops and restaurants on your doorstep yet still with a village atmosphere. Also, the beautiful open spaces of Regent’s Park are just moments away and the fantastic connectivity to literally everywhere provided by Eurostar at St Pancras and Heathrow Express in Paddington can’t be underestimated.
- You’re a Director and Board member of top lifestyle/property publications The London Magazine and Fabric; how has your approach to property marketing changed in recent years and do your clients still get results from – and request presence in – print?
We have naturally embraced the internet and invested heavily into our website (which is being re-launched very early in the New Year) similarly, social media is playing an increasingly important role in business today but there is most certainly still an important place in the market for print.
Indeed, many vendors like to see their properties exposed in this way and although it is much harder to record enquiries from print as opposed to electronic marketing.
We often find that enquiries which come to us online have, in fact, been prompted by someone seeing an advertisement in one of the property/lifestyle magazines so it is important not to underestimate the influence of the magazines.
At Aston Chase we continue to prominently use this form of advertising in order to promote our brand, to keep the firm’s profile high and, of course, to beautifully present some of the magnificent properties on which we are instructed as it is difficult/impossible to do full justice to them on the portals.
Ultimately, in recent years marketing techniques have become far more sophisticated (especially around New Homes) and we attempt to ensure that no stone is left unturned in our pursuit of achieving our clients’ objectives.
- As a Trustee and now Fundraising Chair of Norwood, you devote alot of your time and energy to charity; are there any big events coming up that we should be putting in the diary?
Well, we have just had our Annual Dinner in The Great Room at The Grosvenor House Hotel. Boris Johnson was our Guest Speaker and the event was attended by 1300 guests and raised £3.2M for the charity.
We also held a sold out poker tournament at The Playboy Club London and early in the New Year we have a YN Property Awards event at Lancaster London and a Private Equity dinner at The Savoy.
The events and commitments keep coming thick and fast. Due to severe local authority cuts we are required to raise £12M per annum through voluntary donations, so it is obviously a time consuming and challenging position…it makes my day job look easy!
Seriously, it’s a great cause and it is is very rewarding when you are fortunate enough to be able to give something back.