Phil Spencer urges sales-only agencies to get into lettings

TV property expert Phil Spencer says the slowing sales market should spur sales-only agencies into the lettings field.

He suggests that ongoing revenue from offering lettings, and especially from having a portfolio of clients’ properties under management, provides a strong base for firms which may have lower sales volumes as the current busy market turns. 

“That’s why many of the country’s largest agency chains - for example Foxtons, Belvoir, Hunters and others - have all been working hard to increase the size of their lettings divisions and the numbers of properties they have ‘under management’” he says.

Spencer - in his column for our sister publication Estate Agent Today - acknowledges that many landlords are reportedly quitting the rental sector because of higher taxes and more red tape.

But he says a counterbalance is that those landlords remaining are faced with the prospect of greater regulation in the short term - driving them to use lettings agents.

“The significant majority of landlords own just one or two properties and are, in the best sense of the word, ‘amateurs’. Unsurprisingly many now rely (and pay for) the expertise of agents, who in turn enjoy referral fees by up-selling services such as inventories, insurance, tenant referencing and much more” he says.

In addition the long term trend of the private rental sector expanding offers security against the short term volatility of sales.

He tells EAT readers: “As the sector grows, so demands for it to professionalise are also growing.

“Some of those demands are from institutional investors who fund and manage purpose-made Build To Rent properties, which can make ‘old school’ buy to let landlords appear distinctly less appealing without the professional assistance of expert agents.”

You can read his column in full here.