My World: June 2021…
This is part of a series of articles where our contributors describe how they think things will look a year from now.
The industry will experience consolidation, with an acceleration of technology and more flexible operating models among remaining players
The covid-19 pandemic has affected everyone and, sadly, been devastating for many. In business terms, at the time of writing (mid-April), my future revenues have been severely impacted by the cancellation or postponement of training courses, seminars and other speaking engagements and by the understandable desire of clients to preserve cash and batten down the hatches.
A lot of my work is advising business-owner clients on strategy and their business plans, so it would be ironic if I didn’t apply the same thought processes to my own business. I moved quickly in early March to rejig my business plans for 2020 and, importantly, to collect outstanding monies owed. I now expect revenues in 2020 to ultimately be half those of 2019, but I undertook a review of every aspect of my business and took appropriate action to ensure I survive. Like everyone, I have more fully embraced video conferencing and will be delivering more online training content. I have also hosted several industry round table discussion groups and presented at several webinars.
The next few weeks, if we are making progress on managing the pandemic, should see businesses turning their attention to plans to hit the ground running as the lockdown ends, and I will be well placed to assist. In estate agency the 4Ps of people, premises, portals and proptech will be key areas for action. More businesses are likely to struggle coming out of lockdown than they did entering it, as government and other support may be reduced and lack of resources could make it harder to take advantage of the opportunities that exist. On this basis, the true impacts of the crisis are probably six to 12 months away.
I expect the property market to look quite different a year from now. It was already changing, but that paradigm shift will accelerate as a result of covid-19. I forecast a significant reduction in the number of estate agency offices and people – perhaps by as much as 25%. Technology will come further to the fore, with more flexible operating models emerging. The current big three portals will be significantly damaged and weaker portals may not survive at all, as agents decide to list properties on only one or two. There will undoubtedly be greater consolidation across the industry, with mergers and acquisitions taking place, often as a result of fire sales by receivers and administrators.
There will undoubtedly be new entrants, unhindered by the baggage of the past, while some existing players will find the strength to emerge leaner and fitter with an increased market share. I expect fees to increase and the value of a good managed lettings portfolio to become more fully appreciated, as the cash flow benefits have been more apparent than ever during the crisis.