When I started Glentree in 1976, estate agents were a crusty old lot, populated by the quintessential ‘Group Captain Windbag’ with the customary handlebar moustache, fob watch and a ‘plum in the mouth’ accent.
Their skills were more adept at propping up the bar with a G&T (or five) in a gentleman’s club than they were at making a serious attempt to sell any homes for clients.
Invariably, the agent’s logo was black and white and when you were forced to go into their ‘Dickensian offices’ for a meeting, you were greeted by a ‘Samuel Keats’ look alike negotiator, with a quill pen in hand, who would proceed to blow the dust off their house register. I kid you not!
Contact with clients was better arranged using smoke signals and semaphore than it was by telephone, which to them at the time was a new-fangled gadget which surely intruded into people’s lives, and therefore its liberal use was limited at best.
COLONEL CARUTHERS
The negotiator, ‘Colonel Caruthers’, far preferred a typed and posted letter using Tipp-Ex for corrections (if you remember this) and an Imperial typewriter was a prized asset of the office at the time. Bill Gates might have been born in 1955 and Tim Cook 1960 but what they would achieve between them was astill just an idea if at all.
I swept into this antiquated world brisling with enthusiasm and breathless energy, with absolutely no prior experience whatsoever. I was a parable of ‘winging it’ and ‘learning on the job’. No surprise there, as I was studying dentistry only a few months earlier.
LIFE AS A BUSKER
Glentree’s Floridian, two tone green logo, looked more like a garden centre than a serious estate agent aspiring to sell landmark properties in north-west London.
My metallic apple green Alfasud motor car, believe it or not, even in 1976, had a Pye 9 Channel, ‘ship to shore’, car phone in it which, may I remind you, was state of the art technology at the time.
Effectively, I was a one-man band office. But as a busker, I still had to know how to play all the instruments, if you get my drift.
Besides ‘For Sale’ boards, there were only adverts in the press and magazines which the industry used to promote their properties for sale and rent.
I (together with three others) made a valiant attempt to bring down the page price for the glossy property lifestyle magazines, i.e., Boardroom and Portrait, from an extortionate figure of £2000 per page to £500 per page by the formation of Fabric Magazine. This was an agent’s collective set up to protect the interests of the industry.
Needless to say, shortly afterwards, both these former magazines went to the wall.
Goodness knows how I managed to sell the highest valued, trophy properties at world beating prices in London.
How times have changed!
DIGITAL WORLD DEBUT
It was only until sometime in the mid 90s when the Leaming brothers started what is commonly understood in the industry as the first ever property portal namely Property Finder, which allowed the innovative digital world to make its debut in the estate agency world.
Over the next few years, a variety of similar portals were launched such as findaproperty.com, Asserta Homes and by the late 90s estate agents’ software had become more widely used in the industry, supplied by a succession of specialist IT companies.
BUG FREE MILLENNIUM
We sailed, bug free, through the Millennium and in circa 2000, Rightmove was founded by four corporate estate agencies, Countrywide, Connells, Halifax and Royal Sun Alliance.
This emerging portal was free to list and for an agent, what was there not to like about this model?
In 2001, I was invited onto the Board of Primelocation, which was an £11 million start up supported by Hamptons, Douglas & Gordon, Savills and Glentree. This portal managed to ‘hoover up’ a good deal of the central London and high-end agents, whilst Rightmove attracted a lot of the corporates and regional independents. Another portal, Property Finder, had a good mix of each of them.
COLD CHILL OF KODAK MOMENT
In mid 2000, major newspaper chains were increasingly suffering from ‘tummy trouble’ as they became concerned that the news of their ‘imminent demise’ was on everyone’s lips, and they were feeling the cold chill of a ‘Kodak moment’, if anyone remembers this. Despite this brands ubiquitousness at the time, it was made redundant by the onset of the digital camera.
The day of the digital portal had arrived. Not before time.
CHICKENPOX AT A CHILDREN’S PARTY
The Daily Mail Group ‘upped the ante’ by acquiring Primelocation for £48 million which was shortly followed by the flotation of Rightmove, which had a market cap of some £400 million at the time, which was a humungous figure by any interpretation.
The ‘genie was out of the bottle’ and portals started to emerge faster than a dose of chickenpox at a children’s party.
At first, the portals offered agents free to list options but very shortly afterwards tariffs were imposed and have since increased exponentially over time, as the portal market has become polarised.
Zoopla was the precipitation of a number of smaller portals to include Primelocation and very soon they, together with Rightmove, became a predatorial duopoly, bent on the boa constricting of agent’s wallets.
WRITING ON THE WALL
In 2012 I could see the writing on the wall for agents, and as such I set up a secret meeting with the ‘great and the good’ of the industry in-order-to found OnTheMarket.com (OTM).
This agent’s owned collective was then floated on the stock market about nine years later with a market cap of £110million.
It set it’s sight on being a ‘giant slayer’ in-order-to act as a safe haven against the two incumbent portals, Rightmove and Zoopla. This was a last-ditch attempt to protect the agent’s interests, as monthly portal charges continued to be exponentially increased.
LAUDABLE AIM EXTINGUISHED
Sadly, this laudable aim was extinguished by the sale of the OTM to the USA colossus CoStar for a paltry sum of circa £110 million.
Oddly enough, this American connection with the UK residential property portal world has become infectious.
Today, the largest shareholders of all three major property portals are American and intent on abusing their market power at the expense of more than 10,000 small business estate agents.
Arguably, all three are not acting in the UK national interest and may not even be good for UK residential property in the long term.
CONSPIRACY TO DISINTERMEDIATE AGENTS
Eventually, the day will come when the portals decide to sell properties directly themselves and this will complete the conspiracy to disintermediate agents all together.
The only glimmer of hope for agents today is that AI (Artificial Intelligence) will start to eliminate the need for portals altogether and enquiries will go straight to the agents at no cost.
Rightmove’s largest shareholder are funds managed by USA based Virtus Investment Partners and Zoopla has been owned by a USA equity firm Silver Lake, who have reportedly put a for sale sign of circa £600million for the site.
OnTheMarket.com will inevitably change its name to Homes.com and the Washington DC based CoStar seem intent on dominating the market, not just in the UK but across Europe, where they already have a significant market share.
CASH COW THAT IS RIGHTMOVE
Rightmove is a ‘cash cow’ and they are forecasting annual revenues of £1.815 billion in the medium term and the rationale for them is to triple monthly agents’ fees, with no end in sight.
They already have an eyewatering profit margin of over 70% (which is bordering obscene for any trading company), and they can thank the naivety of the agents and their brethren for this largesse.
I have tried my hardest to remind my fellow agents that these colossi would be hollow shells had it not been for the data and the monthly subscriptions that the agents somewhat reluctantly provide. The connotation of the ‘drug dealer and addict’ springs to mind.
FRANKENSTEIN’S MONSTER
No one can say that I have not warned the agents of Armageddon and that they have unwittingly built their own Frankenstein’s Monster but ‘none so deaf as those who don’t want to listen!’
Lemmings will be lemmings!
Trevor Abrahmsohn is Founder and Director of Glentree International
