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Why successful property transactions need difficult conversations

By Nic Pejacsevich, director of Nicolas Van Patrick.

One of the measures of a good agent is the number of uncomfortable conversations they are willing to have. Telling the vendor what they want to hear and overvaluing their property may result in instructions but in our experience, it will not turn out well.

At Nicolas Van Patrick, we are having plenty of uncomfortable conversations with vendors right now. The market is price-sensitive and slipping values mean the tempo is sluggish, yet decisions on price adjustments need to be executed swiftly by clients, which is easier said than done! In Knightsbridge, the volume of transactions is low and those which are happening are mainly to European buyers already based in the UK who are purchasing a home, whether that be a house for their growing family as a long-term base or a pied a terre for their own use. Many have been priced out of Chelsea and Notting Hill so are buying in Knightsbridge because they are finding value. Very few are investment buyers.

We find that if you get property on the market at the right level from the get-go, it results in a happier outcome for vendors. Sometimes the price is right from the start, sometimes not, but the key is that the client understands that while we may be prepared to try for the higher price they desire, we maintain that a lower price is the right one. This sets the correct tone for the relationship, making it easier to go back and reduce the price should it not sell at that higher level.

Part of the problem is that prime central London is made up of micro pockets or markets, with Notting Hill very different to Marylebone, Knightsbridge to Kensington etc. Available data on pricing is often much more general and doesn’t drill down enough; for example, even within an area, Montpelier Square is very different to say Chelsea Square. This is where an experienced boutique agent adds value, as long as the vendor is prepared to listen and take advice. In 2014, ultra-high-net-worth individuals gravitated towards London but that is no longer necessarily the case as there are other options with less onerous taxation. There is plenty of cash ready to pounce on the right opportunity, but by this we mean ‘best in class’, which is few and far between.

In a tricky market, the worst advice you can give a vendor is to price high. There is a strong chance they will end up chasing the market down, achieving less than they would have done if they had priced correctly at the outset. Vendors must consider whether to adjust their price now to a level that they may well be uncomfortable with but means they end up transacting or pull out and return at a later date. If the market perceives the price to be fair, buyers will come out and bid; if they think it’s considerably overpriced, they won’t dare make any sort of offer as they judge the vendor to be out of touch with reality. We find buyers prefer to engage with a serious seller who is priced more realistically from the outset.

Of course, we want to get the best price for vendors but we are sober about how this is achieved given market conditions. On one hand, we are delighted to have a good level of decent stock, but it is indicative of the market we are in, with vendors trying to sell before the tax situation potentially worsens should a Labour government be elected in 18 months’ time. For those concerned about this, the time to do something is now. The market will pause as we get closer, so if you are somewhat bearish about a Labour government and what it might entail, our advice would be to prepare for those difficult conversations with your agent and take action now.

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NVP enjoys record-breaking year as Knightsbridge market turns a corner

By Patrick Alvarado, director of Nicolas Van Patrick

Despite a turbulent few weeks with the mini-Budget the latest in a long line of events to disrupt the housing market, NVP is on target to have our best year ever!  

Since setting up the company in 2014 much has been thrown at us – stamp duty increases, the back and forth over Brexit, Covid, the war in Ukraine and five prime ministers. The normal sales model hasn’t been there, making for an exceptionally difficult and challenging market. But finally, we can say all the hard work and dedication has been worthwhile as we’ve made some incredible acquisitions on behalf of clients.

We have also been able to work the market to our advantage following an internal restructure and made some significant sales in Knightsbridge Village. We have focused on good old-fashioned agency, qualifying applicants, establishing which are strong buyers and keeping in regular contact with them. As a company we are now in that sweet spot where our people know what they need to do and like what they are doing. Nic and I have seen difficult markets throughout our careers and while they mean less volume, they give you more time to work what is there. To place transactions well in difficult markets needs a combination of hard work and instinct.

We find ourselves in a position where we are posting a good profit and are excited about next year even as the wider economic situation is precarious. We have been true to ourselves, and it has paid off. Although we are a boutique agency, we have over £30m of deals we are expecting to tie up by the end of November, while I personally am on track to do £100m of sales and acquisitions by the end of the year – a personal best!

Knightsbridge represents best value in PCL

Unfortunately for us Knightsbridge started losing its sheen eight years ago, about the same time as we opened our business. The property market in Knightsbridge therefore has not had the same buoyancy as other parts of PCL. Covid has also meant that international buyers are not around; indeed, the Chinese for the most part still can’t get here. Sales have been driven by Middle Eastern clients, particularly Saudi and UAE, who remain keen to invest and take advantage of the sterling/dollar exchange rate. We have been working with these clients for a long time and while there have been many disappointments along the way we have kept at it. It’s particularly pleasing to see that hard work being rewarded with good revenues.

We believe Knightsbridge is on the up once more and regaining some of its lost shine. Some may still feel that Knightsbridge is ‘too Middle Eastern’ and has been for sale to the highest bidder since the heyday of the launch of One Hyde Park. It hasn’t helped that we don’t have one main landowner like Cadogan or Grosvenor who are sensitively reinvesting in their estates which helps to underpin their intrinsic value. But there is so much more to Knightsbridge than a small section of the Brompton Road. For those looking to buy in PCL, Knightsbridge has everything on its doorstep; Harrods plus many other luxury stores from Sloane Street to Brompton Cross.  It is close to the royal parks, has great schools and the best-value properties in PCL. One client recently told us that he felt Chelsea is too expensive, the condition of the properties is not great and the gardens are non-existent at a certain level. You can buy a similar house in Knightsbridge as you could in Chelsea for circa £1,600 a square foot compared with £2,000-plus a square foot in Chelsea.

Price correctly

The biggest impact a vendor makes is when they launch their property; if you come to the market at an ‘aspirational price’ you lose your best opportunity and may have to wait months or even years to sell. Some agents value high in order to get the instruction before working on it for a long time and then eventually reducing the price. We often find ourselves having to come to the market at a higher price than our initial valuation simply because clients want to work with NVP but at a greater price based on higher valuations they have received from other agents. This results in a much more protracted process. This is particularly the case in PCL where the market is so mature and there are so many data points via the portals and of course someone who knows someone in property, as well as most clients having advisers to guide them.  

There is much talk of an impending UK wide house price correction. However, we feel this is much more applicable to the country market which has seen its sharpest growth in many years which has plateaued since pre-Covid.

Discretionary buyers

Discretionary buyers who don’t need to purchase but would like an asset in London or want to take advantage of the exchange rate make up a big part of our market. They will transact on best-in-class or if something reflects true or discounted value. We are receiving many calls from buyers based in countries with currencies pegged to the dollar who are looking to take advantage of the current exchange rate, yet remain confident on sterling’s ability to recover. While the currency has moved in favour of dollar buyers this does not mean they are willing to pay the prices that are being asked. In their minds, the favourable exchange rate simply mitigates against the onerous 17 per cent stamp duty they have to pay, bearing in mind many of our buyers are both non UK-residents and own a second home. Case in point being a recent transaction with a first-time UK buyer who was spending £15 million in cash on a house and thought he was ‘au fait’ with the stamp duty he would have to pay, but had not allowed for the extra 5 per cent applied to every tier due to him being a non-resident and a secondary homeowner.  

The only exception to all this are trophy best-in-class assets which are few and far between. £10m is something of an ordinary budget in PCL and will still require some compromise from buyers with regard to their ‘wish lists’. Knightsbridge houses are often smaller, taller or narrower compared with what many buyers at this level are used to. Special, wide or double-fronted properties with parking, good-sized gardens and which back onto a communal garden will easily cost north of £20m. 

A happy 2023?

As 2022 comes to a close we find that Christmas is a good time to transact as many vendors want to draw a line on the year having tried to sell over many months. Those looking to sell this year don’t have long to do so; otherwise, the chances are that they will have the long wait until Spring. 

We are cautiously optimistic about 2023 and what it may bring – having seen many ups and downs over the years we trust in the resilience of PCL.

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Super-prime lettings boom as falling prices, stamp duty and Brexit deter buyers

Brexit uncertainty has certainly prompted growth in one area – the prime rental market. In the first four months of this year a record number of tenancies above £5,000 per week were agreed in London. These higher-value rents have been supported by growth in demand from renters, particularly corporates.

At Nicolas Van Patrick, we are not surprised by these findings as in our experience the super prime rental market has been active for the past four years. By this we mean rentals of £10,000 per week and upwards, which are few and far between, so are therefore relatively easy to track. It makes perfect sense: while the government is manoeuvring through Brexit, and with property values coming down, people are looking for flexibility. Why buy a £30m second home, paying stamp duty of £4.5m, when you can rent that property for £1m a year? In a falling market, the savings are considerable: if you bought a second property for £30m in 2014, values have fallen by circa 20 per cent since then, resulting in a £6m loss, plus the £4.5m stamp duty. If you had rented over the same period, paying £4m, you would have made a considerable ‘saving’ compared with buying. While renting is usually regarded as ‘money down the drain’, when prices are falling the smart people rent super prime houses because it is cheaper than buying.

While there has been a strong argument for super prime rentals over the past few years, people have not been totally deterred from buying. On a few of the bigger houses we have had tenants requesting an option to buy or ‘right of first refusal’. This tends to be more common when it comes to super prime properties which get let in markets where values are moving downwards. The advantage for tenants is that they can ‘test drive’ the house to discover whether they actually want to buy it.

Tenants should take advantage of this situation as under normal circumstances developers would never go down this route – once houses have been lived in, they lose that new sheen which commands a sales premium. But developers are having to agree to rent out these properties to keep investors and/or lenders happy. This is one area where yields are strong in London – super prime houses are commanding big premiums in the rental market, often achieving a 5 to 6 per cent yield, as seen with developer Graham Hedger’s super-prime houses in Notting Hill.

In Knightsbridge and Belgravia, rental values average £1,097 per week for a flat, rising to £3,243 for a house, according to LonRes. At Nicolas Van Patrick, we expect these rental values to harden in coming months as we get more clarity over Brexit and vendors, who have been holding off from selling, will come back into the sales market, resulting in a limited supply of rental stock. It is also likely that, following changes to mortgage interest tax relief, all but the most professional of landlords will exit the market because yields are generally so poor in London.

As far as tenants are concerned, we are finding that they are remaining in situ and renewing tenancies as they take a ‘wait and see’ approach or requesting a two-month rollover which can be broken on either side. Only once there is more clarity when it comes to Brexit will many of these tenants even think about becoming buyers.

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Why now is the time to buy a house in Knightsbridge

If you are buying a house in Knightsbridge, Nicolas Van Patrick believes it is the best opportunity to do so in a decade. Flats have weathered the recent downturn in pricing better, and subsequently are still at a 30 per cent premium compared with houses. Those in the market for a family home are therefore more likely to get a comparative ‘bargain’.

Knightsbridge property has seen the biggest price corrections in the ‘golden triangle’ of prime central London, which also comprises Belgravia and Mayfair. Within Knightsbridge, houses are showing the most value and are the most discounted as flats remain in high demand. International buyers in PCL tend to prefer lateral flats with a concierge to keep an eye on things as London is only one destination out of many and they don’t live here full-time. They are used to living in condominiums and taking off to Mykonos or the Caribbean for holidays, rather than sitting in the garden of a house.

New developments offering state-of-the-art gyms and treatment rooms are taking the flat market that step further, making them even more luxurious and expensive. The trend for high-end developers to team up with luxury hotel partners has also boosted the price of flats. Billionaire hedge funder Ken Griffin paid £100m for the penthouse at HSH’s Peninsular London scheme on Hyde Park Corner, while the Finchatton scheme, 20 Grosvenor Square, has Four Seasons-serviced residences. Boutique developer Clivedale is behind the Dorchester Collection at the Mayfair Park Residences.

The numbers are significant, with house prices in Knightsbridge falling by 20 per cent over the past five years – less for a ‘triple A’ house, as there is very little stock so the good stuff holds its value. And even if a house isn’t significantly cheaper because it is special, international buyers will still benefit from the weakness of sterling, which translates into a considerable additional discount.

For a double whammy in terms of value, consider a tired house in need of renovation. Buyers don’t just benefit from the 20 per cent fall in prices caused by Brexit and the hike in stamp duty, but also lack of competition and interest from other buyers who don’t have the appetite to manage such a project from abroad. Nicolas Van Patrick has several unmodernised houses for sale in Knightsbridge Village – charming Victorian properties with real potential for those looking for value and a project. 

For those who aren’t bothered by stairs and lateral space, a house may be the answer.

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The lost art of valuing property

Estate agents have come under attack for overvaluing properties in order to attract homeowners. Research in The Times claimed that some estate agent chains are overvaluing properties by up to a fifth in order to get the instruction. The Times added that the biggest agents, who often charge the highest rates of commission, were the worst offenders.

In a quiet property market, with a subdued number of transactions, competition for instructions is fierce and vendors who think their homes are worth more than they actually are may be flattered into going with the agent suggesting the highest price.

However, this can cause problems. While it’s obviously not a practice we engage in at Nicolas Van Patrick, we have come across agents at other firms who grossly overvalue in order to get the instruction, with the property eventually selling many weeks later at the price it should have been on at originally. But while a vendor may think it is worth taking a punt and that no harm will be done, sellers should be wary of putting their property on at too high a price. If that price is more than 10 per cent higher than what the property is really worth, prospective buyers won’t even bother viewing because they will think the seller is unrealistic and that it will be a waste of their time.

A property makes the biggest impact when it is first launched on the market, as it will be at the top of portals such as Rightmove, Zoopla and On The Market. This is where almost every house hunter starts their search so you need to ensure that your home stands out – for the right reasons. But if you get it wrong and it is significantly overpriced, it will drop down to page three, four, five or lower over time, and be lost in the crowd. If you subsequently need to cut the price, this information will be recorded on the portal so that everyone can see how over-optimistic you were in the first instance. A competitive price from the beginning, on the other hand, is more likely to spark interest, viewings and potentially offers.

So how does Nicolas Van Patrick value a property in prime central London? We start by looking at recent sales of similar houses or apartments on the same street. This is harder in a subdued market where there are fewer transactions so comparables are harder to come by. The pounds per square foot achieved by other properties can also be a useful guide but it doesn’t give you the full picture and one has to bear in mind that there can be anomalies. A house may be worth half a million pounds more than the one next door because of a break in the terrace opposite, for example, so it has far-reaching southerly views rather than looking straight onto the neighbours. Or it may be slightly wider, or the building is managed better, or it is positioned on the quieter side of a garden square, rather than the busier side where the traffic cuts through. It is not always immediately obvious.

We also have to take the client’s wishes on board. Vendors often want to sell but at a certain price, so we may come up with a valuation only for them to argue that they want to ‘try for a bit more’.  Our response to that might be: ‘you know what we think but let’s try your price and if we don’t get a result, remember this conversation as to what we thought it should have been in the first instance’.

Vendors trying to choose between estate agents to sell their home may wonder how they work out whether the agent is being realistic about the valuation. The agent may well try to flatter the seller by suggesting a high price but if all the comparatives are pointing to a different one, then chances are they are overvaluing to get the instruction.

There is an art to valuing property and some of that has been lost because of the internet. People can do their own research and see how much everything else costs. If you are comparing your property with an identical one, then fine. But in PCL in particular, the portals don’t do the job for you.

Remember, the market will have the final say: everything is saleable but at a price.

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Online brands: a word from our peers

We’ve spent the last few months assessing the various factors at play in what is a challenging property market for buyers, sellers, agents and investors alike. With multiple concerns such as the global recovery from the financial meltdown in 2008, the onerous levels of stamp duty payable since late 2014, and the barely believable chaos since the referendum was announced in 2015 and Brexit confirmed in 2016, the market has been on the ropes and suffering. However in the past two to three years another factor has been at play in disrupting the once so reliable waters of UK property. Online agents have been the talk of the town. Sky-high share prices for brands such as Purple Bricks and Emoov have seen new challenges to traditional offerings. We asked four of our closest colleagues in the industry what they thought of the online agency phenomenon, and what the real trends are as the hubris dies down:

Marc Wiehe of Winkworth:

Online brands – they are not agents, they are brands – are proposing a subscription model and hardly anything else. They have individuals or very small teams covering vast areas of the housing market, leaving many clients feeling deserted in their hour of need, whereas traditional agencies have highly concentrated clusters of advisors providing critical analysis and focused local expertise. For online brands it’s all about winning the subscription fee – the registration – and that’s usually where the service finishes. The inexperienced seller is then left on their own to navigate their sale and deal with their potential buyer and often the chain breaks down because of this, causing further frustration in an already difficult market. It is confusing for sellers across the board, and I’d be interested to know the truth about how instrumental the online brands have been in making a slow market into a stagnant market. You can point at the crisis, you can point at stamp duty, and you can point at Brexit, but what about this new factor where sellers are suddenly asking if the ‘online revolution’ will enable them to save thousands on fees? This is a dream world. The real issue is that there are no cohesive industry standards. Proper regulation, where online brands would have to be 100% transparent about how many properties they are actually successfully selling, is the only way to protect consumers from the kind of claims being made. Until this happens, or until the industry rallies together against nefarious business practices that fleece young families of their cash, consumers will keep dreaming about a free lunch and that will continue to have a flattening effect on the market.

Bertie Russell of Russell Simpson:

As an agency whose reputation is built on repeat business and word of mouth we have never had a shop front in our 40 years of business. In keeping with modern terminology, this means we have been a ‘hybrid agency’, using both online and traditional techniques, since the dawn of the internet, which we started using some time ago to market our services and our client’s homes, and to develop our business. It is nothing new! I suspect the online property brands that survive will eventually become hybrid agencies of sorts. In my opinion online agencies have perfected the art of marketing themselves to customers without necessarily having the customer’s needs at the core of their objectives. Online agencies create their revenue through a subscription model with most charging their fee on listing rather than on sale which disincentives the company or individual from completing the main objective of selling the property. At Russell Simpson, we believe that in order to complete this goal successfully we require a full team of well trained and knowledgeable people to carry out the traditional tasks of valuation, marketing, viewing, negotiation, managing the transaction and in most cases assisting the buyer and seller alike through a complex process which usually is highly unfamiliar and emotionally testing. At present digital agencies are offering a fee at a cost of 5-10% of traditional costs but they are also offering a service that is 90-95% less effective with an enormous quantity of sellers being left with unsold properties resulting in the ultimate goal not being achieved. The customer’s needs must be placed at the centre of the equation. Online agencies have underestimated the emotional connotations around buying a home, particularly surrounding higher value property transactions. These are not simply financial or legal transactions and they never will be. Because of this we believe people will remain at the core of residential property, while updating their skill set and knowledge with digital technologies to improve the service for the customer.

Karim Bazzi of Homes One:

We see online property brands as being in start-up phase. They don’t know what they are here to do yet. They think they are agents but they’re not, they simply don’t have the manpower, experience or expertise… in the end, I suspect online property brands and traditional agents will merge and create a new hybrid model that has both dynamic technology and substantial teams of experts as standard. At present I suspect the onliners are selling very little real estate in central London, and perhaps only at the bottom end of the market. This is sad as consumers are presented with a very different story, and it is often young families working on tight budgets who are affected most. Paying £1000 to an online brand is pretty steep if they don’t actually sell your home. I believe it is better to get the result you want and then pay a commission… what needs to change is that technology could potentially remove a lot of the work involved, if there were proper, cohesive regulations and industry standards. This could reduce the price of commissions as the administrative load would be less and the process could be quicker. However I still believe that above a certain level, experts are needed to help buy and sell homes, as the price points fall into the once-in-a-lifetime categories. And no one wants to compromise such a significant investment. At present we are seeing hubris, and vastly inflated share prices of these online brands that are based on paying listing subscriptions rather than actual performance. Once people realize that it may well be worth paying 1 -2% for an expert we will see a return to the previous model, or a new solution emerge which consolidates the tech brands with the traditional. Either way I embrace any change within the context of integrity and transparency… and I suspect the online property revolution has someway to go with both.

NVP comments:

At NVP we have always believed in traditional values, and as our website shows we rate handshakes over clicks any day. We also believe that online property brands are not online agents. Agents provide very tangible savings and expertise to their clients, especially in the mid-top tiers of the market, and the difference we make to people’s experience of the home-buying and home-selling processes can be life changing. Online brands are not providing this service. They are positioning themselves as doing the same, however the reality is they are playing a very different game to us – a different sport in fact. They advertise homes, but they don’t market and sell homes, at least not intensively which is what is required to compete. The media has not quite realized this yet, and when they do the narrative will shift and people looking to buy or sell their home will realize that they want a) less work to do not more, and more importantly b) the difference an agent makes can put five figure sums in their back pockets… and sometimes six or seven, and all for a small percentage of the deal value. Small teams of property experts cannot cover vast areas of the market like some online brands are claiming – rather medium to large teams are needed in order to comprehensively cover small locales. We can’t see technology changing that, at least not in our lifetime. When this much is at stake, people want to know that they are working with people, rather than data-driven robots with no grasp of emotional intelligence. Buying a home is an emotive thing as much as it is financial, and for these reasons you cannot discount real experience and expertise. Alongside all this we embrace technology, as it works arm in arm with the unique service and rapport our team has with our customers. It is here to support the provision of expertise and value, not to replace it.

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How millenials are changing the housing market

The debate is underway as to whether online agents are really performing. With a new market of millennial ‘digital natives’ coming through, online brands are advertising huge successes in terms of customer acquisition, while staying cagey about the number of deals that are actually being done.

As the number of millennial owners at the bottom end of the market grows, online brands are feasting on subscription fees, regardless of actual performance. It’s impossible to tell whether or not the market is quiet because online brands are doing all the deals (probably not), or if we are all in the same boat due to the usual political and economic factors (likely). Either way millennial sellers are more susceptible to the next big idea, and of course the promise of big savings is attractive to anyone, providing it is held.

But how many times will people pay a fee to have their property listed on these brands, with no return? In the short term these developments fuel hyperbole and make the truth harder to discern.

Shift in generational focus:

For some time now it’s been dawning on us here at NVP, that property prices are going through a correction. In our own market here in prime central London, we are relatively ring fenced from such an eventuality, as both UK and international HNW buyers will always want similar things – a home in London in one of a handful of locations, of which at NVP we span three or four neighborhoods. However even in these areas we are seeing dramatic swings in valuation and price. Pricing itself is a major issue, and over-ambitious vendors can expect anything up to 40% taken off their asking prices. Recently we saw a flat priced at £2.1m go for £1.31m – eight months after going on the market.

But what of elsewhere? What factors are really driving the current dips in sale value?

Apart from Brexit and various geo-political influencers, here at NVP we are constantly reminded of the generation gap between ourselves as Generation X’ers, and new buyers coming through, aka ‘millenials’. Generation X knew they were on to something with property. Fair enough, it would take 25 years to pay off mortgages on semi-prime homes, however we were also confident that those properties might double in value, over ten years or so, which meant we could upscale our investments several times in that window. That was enough to get the vast majority of people interested, who were able to get a mortgage.

The sub-prime property dream – yours after 25 years:

And for millenials, what are they promised?

Let’s take a successful specimen, who joins Goldman Sachs straight out of university on £75k per year. Providing they have someone to gift them a deposit, they still can’t even afford a studio in prime areas. Also out of reach would be a one or two bedroom flat pretty much anywhere inside zones 1 or 2. Our clever little friend is left spending Saturdays viewing flats and tiny houses in Croydon, Streatham, Tottenham or New Cross. Assuming they safely navigate such activities and find somewhere they like, let’s look at what that will cost them. Broadly speaking they will have £450k to spend at best, repaid over a life-sapping quarter of a century. With little immediately promised in terms of capital gains, and let’s not forget most millenials will have nothing like the highly-geared income projection of a newbie at Goldman Sachs, they are faced with dedicating the next two and a half decades to living in similar places to those mentioned above.

In a two up / two down!

You have to wonder ‘how is that worth it?’

25 years doing what is necessary to pay down a mortgage on somewhere in Knightsbridge, or even on a semi-prime home in Shepherd’s Bush, Clapham or Hackney, is one thing. It’s something else for somewhere you don’t even want to end up, in a sub-prime property that doesn’t inspire or delight you. Many millennials see this as being true, and recognize mortgages as the life long commitments that they really are. And if you’re in something for life, you are well advised to ask if it’s worth it.

Alternatives:

For this reason we see millennials putting their famous eye for perspective in line with a different dream to previous generations. Millenials value experience over ownership. Sharing over property. Moving around over settling down. They expect equality in pay, hierarchical structures and of course other areas such as gender, race and sexuality. They refuse to accept traditional pecking orders, and consider themselves equal to others in any forum. They are more self-realised than previous generations. They don’t need material possessions to achieve a sense of status.

How can these enlightened perspectives be applied to the housing market?

There are big paradigm shifts underway. Communal living options are springing up everywhere, and long-term lettings have become commonplace, giving people the security of living in one place over a substantial period of time, without the weight and responsibility of ownership. Even in super-prime London we are seeing examples of these trends, although to a lesser extent obviously, due to prices.

Online options:

A millennial scraping together £200-400k is far more likely to instruct an online agent, for better or for worse. They value transaction over experience, and have much less to lose than those with more to spend. As soon as you go over £750k-1m the potential for swings in price and judgment can end up costing clients the price of a small home if mistakes are made. And this is where agents play a priceless role in the buying chain.

At NVP our team has been working the property in the Knightsbridge locale and surrounding areas for over 25 years. Our sales guru Johnny knows the history of almost every home in the neighborhood, having seen so many of them change hands so many times in that period. This kind of intel is off the record. It is the sort of information that an owner only gets having lived somewhere for a few months, and it can impact the buying process immeasurably.

Online agents may provide a cheaper option for potentially selling smaller homes, however at the middle to top end of the market it is a often a fallacy, with the number of considerations and the sheer level of value such experience can provide. Online brand will never be able to offer the specialized expertise that local agents have accumulated over the years.

Millenials may or may not see this as being true. Either way, fewer and fewer of them will be in the market at such a level, as long as things remain the same.

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NVP Lettings: Knightsbridge property management, sorted.

In our new phase here at NVP we’ve brought together two lettings teams, with a combined total of over fifty years experience in lettings and management.

Together this new team, representing an increase in capacity of 300%, will bridge the space between tenant and landlord, across Knightsbridge and the whole royal borough – with over 130 properties currently under management.

But it’s not all key-holding, EPC’s and gas safety certificates.

With various CV’s involved including two ex-golf pros, a crown estate executive and several elite family offices, NVP Lettings is perfectly poised to grow their share of a property sector that is flourishing. Lately there have been deals aplenty, with a student flat going for £20k per week (not your average digs) and a neighbour of ours renting their penthouse for just below that (lush view of park included). Additionally, NVP Lettings closed six separate new leases (lets) in the first month since we incorporated the other market-leading Knightsbridge estate, Hobart Slater, into the NVP family.

And in between the practical logistics that make lettings and property management such a multifarious task, the stories brought together by our impassioned client-focused team are the stuff of legend.

Whether it’s liberating an Oscar winning actress from being locked inside her own bathroom while staying in a short lease on Walton Place, finding suitable quarters for 007 while on London-based assignment, or making sure one of the greatest lead guitarists of our time is cosy and comfortable on the UK leg of his latest rock odyssey, team NVP is always at home.

And although such clientele, together with billionaire students and the Knightsbridge gentry, can be famously demanding, Landlords (whom after all are our clients) get to outsource the delicacy of dealing with such a demographic with total peace of mind, knowing the NVP team are the safest pair of hands around.

In a joint statement, NVP founders Nic Pejacsevich and Patrick Alvarado said:

‘The expanse in capacity and pipeline is welcome as we join together with Hobart Slater and create Knightsbridge’s most experienced Lettings team, however what is more pronounced is the vibe we’ve created already in just a few months of working together. Lettings and management is infamously multi-faceted in nature, with a complex array of demanding stakeholders to satisfy, and having a robust culture behind us as we do our work is essential to being able to handle, and grow, the newly expanded NVP portfolio.’

In a joint statement from the incoming team at Hobart Slater, the lettings division stated:

‘We thought we had the best Lettings stories in the royal borough however NVP give us a run for our money for sure. In holding the keys for some of the area’s most prestigious properties, and with in-depth knowledge of almost every apartment and building in Knightsbridge, we’ve seen it all with over three decades of specialising in this area. Now is the right time for change however, and NVP are the only brand out there to offer equal to, or greater than, local expertise. We are Knightsbridge natives, we know the people and the property, and becoming a part of the NVP brand has helped us to crystalise that differentiating factor even further, and set us aside more clearly from our competition.’

The newly formed NVP Lettings division provides the following services:

  • Management of large privately held properties, decreasing the need for permanent London-based staff.
  • Network of international connections and relocation agents to service your requirements at home and abroad.
  • Keyholding and maintenance services designed to ensure your every need as our client is taken care of.
  • Tenancy management and liaison throughout your tenant’s stay in your property, ensuring customer complete peace of mind.

Full range of advisory services around fees, tax, rights and all aspects of the lettings process

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Dear Friend

We began February by moving into our new offices, just along Montpelier Street towards Harrods, in the heart of Knightsbridge.

It’s an exciting move and expansion for us, and comfortably in time for our busiest season of the year, spring (although late Autumn gives it a run for its money these days).

The new office has a palpable sense of energy and enthusiasm to it, and the deal sheet is alive with activity.

Even though the market is officially still flat, things feel decidedly different to this time last year… here’s our thinking, with more detail on why this is happening, and a bit of history and heritage to our developing brand and business:

Bridging the gap:

We mentioned at the end of last year that our intention as a business is to bridge the gap between buyer and seller, and provide similar levels of service to both, due to the current nature of the value chain. Our intentions to build bridges go further back however, and with our recent acquisition of 32 year-old Hobart Slater estate agency, we have taken on an even deeper Knightsbridge heritage.

Originally, this area of London was a series of fields that connected the villages of Chelsea and Kensington, between which the now re-diverted Westbourne River flowed. Knights-bridge was called thus because of the bridge across the river between the base of the Serpentine at Hyde Park and Sloane Square (you can see the re-diversion clearly from the platform at Sloane Square tube station – a feat of Victorian engineering that remained undamaged throughout the blitz in WW2 – even with the rest of the station being destroyed, this subterranean aqueduct stood firm, the water continuing to flow).

Much legend surrounds the bridge itself. In 1148 Queen Maud is rumoured to have met to on the bridge with the citizens of London, to answer their frustrations. And what is more permanent in history is George II’s wife Queen Caroline’s intervention in 1730 to damn the river just north of Knightsbridge, creating the Serpentine, and preceding the major works of diversion in the Victoria era.

It is said that knights would use the bridge as they came to London before leaving for the crusades, to seek a blessing from the Bishop of Fulham. As ‘knight’ has also long been a terms for ‘local lad’ however, the veracity of this strand of the story cannot be verified. And of course when launching our business, after attending school in the area followed by two decades of property specialisation here, we took great care not to position ourselves in such questionable ways!

The bridge we provide these days is between buyer and seller, market to market, cycle to cycle and locale to locale. We are indeed a nexus between these different areas of the Royal Borough, and our specialties of Chelsea, Kensington and of course Knightsbridge, set us aside from the competition.

Our tips for thriving in 2018:

Succeeding in high end property this year is about three things: pricing correctly, immaculate presentation and truly proactive and open communication between buyer and seller.

With continued high levels of political uncertainty and jittery markets, property as a whole is likely to remain flat. We have not had such a plateau since 2009-2011, and common sense says it is a time to hold and trust in natural forces. The cycle is unfolding, and with clarity around Brexit forthcoming, and Trump’s White House tenancy careering out of control towards the halfway point, consumer and investor confidence will return at some stage.

Reinforcing that, the importance of taking the macro view is essential in areas of low pressure like the one we are in. In a long game, it’s important to remember that the market has not gone backwards, there has been no crash, and even in the worst of times back in 2009, prices did not collapse. Rather people these days just hold on to what they’ve got.

There is no point in creating more work than is necessary. In a market such as this, take time to consolidate and reflect, and plan for resurgence in the economy. At NVP we have done this by buying one of our competitors, investing in a new team and premises, increasing the levels of mindfulness we bring to servicing clients, and being more thorough than ever with our pipeline.
The scourge of such times is failing to harvest low hanging fruit.

Diversification is key. We have worked hard to secure a more even portfolio of interests, commensurate with the changing requirements of our clients. As we blogged last year, renting is a way of life for many, even in super prime areas. Long term hi-quality lettings have never been more popular, for clients who recognise the vanishing gains of yesteryear make buying less mandatory than it used to be. In our acquisition of Hobart Slater, NVP now has the definitive balance between both sales and lettings, for all dimensions of the hi-end market.

Our recent blogs:

Spring sale:

From now until the end of March our fee down to 1.5%, for sole agency instructions!

Come and say hello.

Much like the original bridge, we are a meeting point for people in this area of London to access truly high end property intelligence, swap stories, and trade in some of the world’s most exclusive properties.

We’d love to see you soon.

Very best,

Nic & Patrick
T: 020 7581 8277
W: www.nicolasvanpatrick.com

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New Address, New Era

We still have a little more building work to be done but are delighted to announce that we are now in our new premises at 6-8 Montpelier Street, just along from our former office in Knightsbridge, having acquired the prestigious Hobart Slater agency.

Robert Hobart and Roger Slater have been a pleasure to work with, the transition could not have gone more smoothly, and their expertise will always be welcome.

So we now have a bigger team, more properties on our books and a smart new office; not a bad way to begin the year. We do hope you will stop by to say hello soon.