30 May 2008
26 May 2008
The problem here is twofold. First of all with agencies closing, there is fewer competition for consumers and secondly the remaining competition will no doubt carry on with the same absurd practices which led their competitors to go bust on the hope that it won't happen to them.
When I received a quote from some local estate agents, I was alarmed that the rates they quoted of 0.75% and 1% of the sale price were at the lower end of the national average which according to this article is about 2%. Using the national average house price of £218,112 and the figures above, here's an estate agent income calculator:
1. Average house price = £218,112
2. Average estate agent commission = 2% = £4,362 commission
3. Average monthly sales = 7. Therefore average monthly income = £30,535
4 Estate agents per office average, average salary £50,000. Total wages bill approx £18,000. This means approx £12,000 per month profit to cover phone calls, office hire and so on.
Certainly in my case, advertising and other extras such as placement on websites, noticeboards and so on was paid for on top.
So what did I get for my 1% deduction on the sale price, according to the bill? "Professional charges including preparation of draft schedule, validated and printed, insertion of photo in local offices, placement on rightmove website and dealing with enquiries".
For that they get 1% of the sale price, and sole selling rights which mean:
"If missives for the sale of the property are concluded during the period in which the company has sole selling rights then the charges are payable even if the buyer was found by myself".
So basically the current estate agent model means that even if I find a buyer, they get to charge 1% of the sale price. Personally I think this is an undue benefit to the agent and as such possibly unfair (and therefore illegal and unenforceable) however the point here is that it's a huge commission when you consider the actual effort to achieve it. To sell a property for 400K for instance, there isn't a lot of actual effort the agent needs to do besides place adverts in papers and on websites and for that they get £4K+, something that I could employ a full time consultant for a week and still have spare change, yet the estate agent sits back for the calls and gets the money even if I find the buyer. Surely something wrong here.
This is essentially why so many agents are now going bust, and why so many went bust in the previous housing downturn in England in the early 90s. They are dependent on a very small number of very high profit margin sales and so they are extremely vulnerable to market fluctuations and in a quiet period, their profits can dry up very quickly indeed.
The solution naturally is to pay estate agents a proper fee. I would quite happily pay £100 to write a schedule and take photos. I would also, maybe, pay to advertise on websites although I think that the age of having to do so will pass in the next 5 years as more free listing sites emerge. I also don't mind paying to advertise in local papers if necessary or on a per viewing basis if the agent shows the house for sale. However, I object to paying £4K just for them answering the phone when I could do it myself.
So all in it should be perfectly possible to sell a house whatever its market value for a few hundred pounds + whatever extra marketing I want to pay for. The days of taking 1%, 2% of the sale price should be a thing of the past.
This of course means that estate agents have even less money coming in which means that they have to deal with a much wider customer base. Fair enough, I think that there are probably too many estate agents and if the numbers stay at their post-crash lows then this would be a good thing. By having more customers and a lower margin on each, they would overall make more money due to scale and also would be more immune to market fluctuations
e.g. selling 100 properties a month over a much wider customer base and making £500 on each means that the agent makes £50,000 per month rather than £30,000 and having the customers spread over a wider area means they are less vulnerable to local downturns. Incidentally £500 is the min fee that my agent charged, so clearly it is feasible at this level.
Am I the only one who thinks its time for a shake up in how house sales are charged?
Evidently not, see House Network. Any more like it?
25 May 2008
This picture sums up my attitude towards forced advertising and anti-skip menus on legitimate DVDS
21 May 2008
The surplus would allow Alex Salmond to maintain existing levels of public spending, while cutting corporation tax from 28% to 12.5%, reducing income tax by 5p in the pound and still having £2 billion every year to invest in a Norwegian-style oil fund to safeguard Scotland against a future decline in North Sea oil revenue.
The study, based on Treasury oil revenue forecasts and official spending figures, has calculated that, without money from the taxation of oil and gas, an independent Scotland would have an underlying deficit of £7.8billion. But when £12.2billion of oil and gas revenues are included, Scotland would have a surplus of more than £4billion.
See the link for more info
13 May 2008
11 May 2008
A tale of two websites
The pioneers of e-commerce back in 1995 were Amazon and eBay. Both used a model that now forms the default business model replicated on nearly every other website. That is, you must register on the website and hold an account on the website with a login and password for you to buy anything. This is completely unnecessary, an invasion of users' privacy, does not help in any anti-fraud measures and is simply websites forcing users to hand over long term purchasing stats because they can rather than because it is an integral part of the transaction. We wouldn't tolerate this intrusiveness on the high street and we freely shop there without having to register with shops first, so why put up with this nonsense online?
This forced registration is excess data gathering and contravenes the third principle of the data protection act, namely that the information being handed over - the customer's buying history - is excessive for the purposes of the individual transaction. Sure it's convenient to have an account already set up if I don't want to enter my data repeatedly, but on the other hand it's really inconvenient having my every purchase tracked, and trying to log in when I'm required to have an account have forgotten the password and hate having yet another website where I have to remember yet another username and password.
Argos, a top 5 retail site in the UK is now bucking this 13 year old trend. You can register if you want to, but you don't have to. Well done Argos. Same goes for Visitscotland.com
Let me tell now the tale of two websites. When trying to buy a Chiminea Barbeque tonight, I found two very similar models at the same price.
One was on greenfingers.com which insisted I had an account or registered first, then when I went to register it said I couldn't because I already had even though when I went through the 10 minute forgotten password dance and logged in there was no account info there. The other was castironchimineas.co.uk which didn't require me to register and as an added triple bonus didn't have the other usual website irritations such as a mandatory courtesy title, needlessly separate first and last name fields (i.e. one field for the whole customer name) and finally allowed Scotland as a valid country. Naturally the latter site got my business, it was far simpler and easier to use.
Well done, castironchimineas, someone taking a leaf out of my book not only on flexible e-commerce, but also how to capture a customer name but also website usability guru Jakob Nielsen who said way back in 1995 that customer name fields should be combined into one.
Maybe 13 years after the e-commerce revolution started, we can start to get back to the basics of usability?
For a government that was so obsessed with spin and image whilst Tony Blair was in power, the publication of these memoirs is clearly something that serves the interests of the authors and who clearly also appreciates the damage it will do to the party as they seek a record breaking 4th successive term.
Clearly they have their own financial interests ahead of such an achievement for the Labour party and would rather be doing their bit to get the Tories elected in 2010 than hold off for a couple of years. An author's fortune or Labour's fortunes?
Coming in 2010. My years with Tony Blair and how my muck raking in 2008 led to Labour's defeat at the polls.
Somehow I don't think that'll be a best seller, unless published by Conservative central office
10 May 2008
With those three words, the political process to make the biggest change to the UK for 300+ years really begins in earnest. A process which could see a large portion of the Scottish cabinet lose their seats post 2011, if the Tories haven't done the job first in 2010.
Bring it on indeed.
07 May 2008
Excellent food and service. Great prices, no pretentiousness. No mandatory tipping or service charge either.
Only slight drawback is that it's yet another place that has a VAT number but doesn't issue correct VAT receipts (with the amount of actual VAT paid on them).
Here's the link Lahore Kebabhouse.
There's also some rather excellent curry to be had at the Noor Jahan 2, 26 Sussex Place, London W2 2TH but again is let down by the inability to produce a correct VAT receipt showing the VAT paid, meaning that the tip amount gets paid to the VATman rather than the staff. Food is excellent here though and there is also a very good pub just across the road, the Victoria at 10a Strathearn Place which has great food (stops at 9:30pm) and great beer. Busy on Tuesday evenings in the pub. Anywhere that gets 5 pints on Fancyapint.com is worth a visit.
02 May 2008
Nokia N95 unable to display message
However, the most consistently annoying thing is that about half the e-mails I receive immediately present the error "unable to display message" when opening the message and then "Conversion error" when the message is opened. I then have to open the HTML attachment to see the contents, which is obviously nice to look at but since I'm using a browser, the email function of "reply" is no longer available.
What's stranger is that if I do press reply without opening the attachment, there is the text content of the message which a few seconds ago the phone reported it couldn't display because of the conversion error and was unable to display the message as a result of said "conversion error".
Is there a solution to this problem or a known cause? After all, if the phone can read the contents to show them when replying why is it presenting the message when the mail is opened?