Posted by: housingdabble | October 1, 2009

Look4aproperty not such a great deal

So look4aproperty have launched a new product to supposedly “kick start the housing market” and used scarcity as a way to get agents flocking to them to sign up to be one of only two agents per town. But what exactly is the deal with this? Is it worth getting involved in?

The property owl and also renthusiast have both posted over the last week and jointly criticised the scheme and I don’t blame them as there seem to be some gaps not yet filled in.

A few points I will add to the property owl and renthusiast blog posts are :-

  • This is just the first part of the scheme and there will be a second part to this launched to loan money to the vendors – awaiting details how that will work…
  • The ‘interest free loan’ to the purchaser is paid for by the seller, and they agree to this when choosing to opt in to the scheme as a marketing tool for their property.
  • All conveyancing and HIPs have to be done through the scemes chosen partner.
  • Agents have to sign up to Look4aproperty to be part of the scheme, at a very hefty £200 per month for a portal that isn’t amongst the top ten in terms of traffic

But the killer part for me is that lenders at the moment are being very wary and the revelation of a side loan to cover stamp duty is almost guaranteed to lead to offers being withdrawn. Having spoken to lenders, they confirm that this will impact the lending decision.

Time to think this through again in my view – agents beware.


Responses

  1. You are right to be sceptical Ben, you and I both know its not going to work. Aaron Turner and James Caan are clearly both clever blokes, but this ‘solution’ is actually too clever for the estate agency market. If agents weren’t able or willing to make HIPs work to the benefit of the agent and the consumer, they aren’t going to jump into bed with yet another offering. And of course behind this is LMS, not really an estate agents favourite firm with huge variances in the quality of service received (in the experience of my sales office). I was one of the early agents onto Look4 and certainly supported the stance of ‘Rightmove is charging too much’ even back then, but Look4 did not go on to deliver on its potential and achieve high rankings/traffic, despite clearly having a good IT back-end in place. I assume LMS are getting HIP/EPC/Conveyancing leads through the Look4 site as part of the deal, but they aren’t really worth too much, everything has become of such a low margin that only companies with extremely low overheads can actually generate cold hard cash when the dust settles and the VAT man has been paid! We will watch this with interest, but I’ll stick my fiver on this solution being pulled within 12 months, and those involved will not have turned a profit on the deal.

  2. Yes Ben I agree – can I also add – Caveat Emptor – Let the buyer beware!

  3. Good article Ben, I wasn’t aware that the purchaser’s loan is paid for by the seller.

    I agree with Neil – the scheme is too clever & too complex for it to reach the mass market.

  4. Completely agree with the above. Caan is beng a true Dragon and being way to greedy with the criteria for offering this including being advertising on the Look4 website and becoming a “certified Look4 agent”.

  5. The guys over at property owl started the ball rolling then renthusiast progressed it and now your delving further, interesting reading and certainly adds further depth to the story. Am i starting to feel sorry for James Caan with you all picking on him? he is one of my favourites on dragon’s den !!!

    It certainly has created some attention on Look4aproperty which am sure they wont be too upset about. Whether the product will actually get launched seems to be the question.

    • there is certainly much more to this deal and so we will have to wait and see as more info comes out. I have noticed things have gone very quiet from Look4’s end in the last few weeks.

      One thing you can say is that they certainly know how to do good PR – when they launched they managed to make a stir too. Problem is that they aren’t making a stir with their visitor numbers

  6. Guys you have got this all wrong.

    This is all about generating massively increased market share for those 2 agents per area that become money licensed agents. No one if forcing their hand – its entirely up to them if they want to join and gain market share at the expense of other agents because those 2 have something unique to offer which no other agents can offer their buyers and vendors.

    instead of pre-empting how you think it will work, I suggest that you all bite your tongue and wait to see all the big agents that LOOK4APROPERTY have signed up.

    What you will all understand and I hoe very clearly is that no estate agent has anything unique at all. And those agents that think they do are kidding themselves. You compete hard for instructions and having nothing unique to offer potential vendors and so compete on prioce alone which lowers your margins.

    MONEY agents now have something unique to offer and you will all see going forward how all your sitting on your hands has achieved nothing and those agents that have joined up and become MONEY agents have taken so much market share from their rivals that their local competition are all going out of business and this may include you lot too.

    you have all got this wrong and I bet that if you don’t become a money agent in your area that your business will suffer.

    Before youa ll try and wokr out who i am – I am a close adviser to James Caan and I KNOW the next thing they are going to bringing out is a low costs no frills high LTV mortgage that is only available through selected agents which means buyers will only go through those few and not the many.

    you have all been warned!!

  7. thanks for your post Tom – you are clearly in the know about what is happening at Look4 and I value your comments.

    I’m not an estate agent myself, but I disagree with your views that they don’t have USP’s.

    In terms of the Look4 deal, I know of one big agent I rate highly that is planning to work on the scheme, but I know many more that have looked closely at it an decided to watch from a distance.

    I take my hat off to everyone at look4 who are clearly looking at new ways to give their member agents the edge – this is what the industry needs. I’m just not convinced from my knowledge of the current scheme that it will be a game changer.


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