The Alex Goldstein Property Show (Part 11)
My February property show with Stray FM is out now! This month I speak to one of the most knowledgeable property surveyors in the business, Jon Charters-Reid, who believes yet another major scandal is brewing in the mortgage industry. I also discover all there is to know about fires and fireplaces. No chimney? Apparently no problem! And will a wood burning stove save money on your fuel bill? And lastly I offer my four best tips to ensure your home positively shines when it comes to buyer viewings.
The Alex Goldstein Property Show (Part 11)
Full transcript below:
Alex: Welcome again to the Alex Goldstein Property Show, the number one rated property show on Stray FM. We aim to solve all your property queries and to demystify the property sector. We have some amazing tips plus some industry expert information. If you need that property fix, then connect with the Alex Goldstein social media accounts to get the best property advice whenever you need it. Now, in this months show we will be getting the inside track from Jon Charters-Reed, a Chartered Surveyor with some very distinct differences and who tipped us off about the next major scandal in the banking sector, which believe it or not could be bigger than PPI. We’re also joined by Chris Worsley, from Easy Fire Place who gives us expert insight into this sector. So much to fit in so we’re straight on with it.
This month we’re talking about the secret to instructing a great estate agent. Now when it comes to this our most important asset, our home, I regularly have conversations with home owners who are getting themselves in an absolute spin and we will say look it is any wonder. From their perspective estate agents all look the same, are going to say the same and they claim to do the same for their beloved home. Many believe that there are just three main criteria to choose from when they’re looking to instruct an agent, however all of these have got major flaws. Let me explain. So firstly, guide price now rightly or wrongly this subject alone seems to consistently come on top of everyone’s lists. Lenders understandably feel flattered when an estate agent exudes confidence in selling their home and especially when a guide price is quoted towards the upper end of the range. Now listen, agents of course know this and may quote enthusiastic figures just to get your instruction, At the end of the day anyone can quote a high guide price, so you have to look beyond this to get the right agent. The second criteria is fees, now estate agents are sales people, if you agree on a commission structure that’s sensible for both sides, the agents going to remain proactive right up until the point of exchange. However, many vendors feel that if they nail that agent right down on commission then they’ve made a saving, in actual fact they’ve instantly dis-incentivised that agent and it’s unlikely now they’re going to push for a top figure so these also need to be put to one side. The third benchmark lies in how professional the agent was in their pitch. They’re on the most part well dressed, they’ve got bounds of enthusiasm and obviously they’ve got confidence in selling your home. Of course, they love your property, which salesperson sat in your home is going to tell you otherwise so again, this point needs to be treated with caution. So, if it’s not about high guide prices, low fees and a professional pitch what do you really need to look at when picking the right agent? The answer of course lies with their front of house team. These are the people sat in the estate agent office who meet and greet potential buyers walking into the branch, deal with phone enquiries, website requests, know the properties, sell them effectively and have a intrinsic knowledge of the buyer database. The valuer sat in your living room, he’s going to handle a element of those but it’s their team back at the office who’s going to engage with all the buyers and the sellers whilst they’re out. And most importantly, they are going to push your property from being under offer to exchange. So, my advice is before you go and instruct an agent, go and mystery shop them as a perspective purchaser, see how engaging, knowledgeable and proactive the front of house team are. Find a team that is exceptional and suddenly you’re going to find that the estate agents guide price, fees and presentation take on a whole new meaning.
Very privileged indeed to have in the studio with me Chris Worsley from Easy Fireplace. Chris thanks so much indeed for coming by. Just talk everyone through your business, it’s a bit more unusual than most I think.
Chris: Yeah, my pleasure to be here Alex. Our business is based in Huddersfield, Easy Fireplace is what’s known as a bricks and mortar showroom and business. That basically means you can come along, touch and feel, experiment with the fireplaces, play with them, see how they work and basically get a gist of what the product is and what it does.
Alex: You cover a whole entity its not just the mantlepiece so to speak to go over it, it’s much more than that.
Chris: Yeah, the aspect of the fireplace industry is much more than what is known as the mantle or the surround, we do the fireplaces, we do them bespoke made from limestone, marble, wood, cast iron, black granite. You’ve then got things like the gas fires, you’ve got your inset fires your outset fires, your wall-hung fires, you’ve then got your stoves, your wood burners, you’re multi fuel burners….
Alex: Is there anything you don’t actually stock or dare I say know about? This could be quite a technical conversation I think.
Chris: Yeah, I mean from the business, it’s in a little village called Milnsbridge, which is in Huddersfield. We’ve got over 180 products on display that we can demonstrate. It’s a case of coming in and we get the product right for you and your home, it’s not about selling a product, it’s abut selling something that’s perfect for the home and how you’re going to use it.
Alex: I mean it’s been quite interesting, what are the changes that you’ve seen in the market in the recent years. I notice the oil price for example is all over the place and I don’t know if you’ve seen a direct result, whether there’s been a upsurge in business.
Chris: The main thing that’s changed is all about performance of what your purchasing, whether the economic crisis that we all went through, everyone started looking after the pound, our money is very virtual and so are our heating bills, then once a month we’ll get slapped with a bill and that’s when the virtual becomes reality. So suddenly its well how can we stop this virtual money becoming such a big reality check at the end of each month.
Alex: So, people get the bill land on the doormat once a month thinking well that’s a lot to be forking out for my gas, oil, whatever you’re running off and people are switching to I dare say, stoves or fire alternatives.
Chris: There is quite a lot of things in the industry that have changed. Basically, the stove market shot up, the stove market went right through the roof, everyone wanted wood burning because they thought it was an ideal solution to make their heating bills a lot cheaper.
Alex: Is that true, is that the case?
Chris: Actually wasn’t. We as a company, my decision was not to join that rat race, basically everyone was selling stoves based on no knowledge, no information given to the customers, the stove and the idea behind the stove sold itself. It is a beautiful product, you’ve got the warm romantic flames, you’ve got the heat from it, it brings back memories of grandparents, it brings back memories of holidays in cottages, whatever it would be an open fire brings back and triggers memories and that’s basically how the industry romantically grows.
Alex: It turned into a big sort of marketing campaign on the stove front. Why didn’t it work out do you feel?
Chris: It’s a little bit the stoves are a really really great product and if used correctly it can be a good heating source. The main thing is the cost of wood has gone up, the cost of coal has gone up, so the cost of actually fuelling that appliance has gone up so not it’s not just that cost effective.
Alex: I suppose the other thing that often crops up is that people really want a fire and traditionally you think that you need a chimney or a chimney breast that you can actually utilise, but I think I’m right in saying that nowadays you don’t necessarily need to have a chimney at all, there are other options open to you.
Chris: The industry has gone down a little bit of a line of interior design. You walk into a room, you assess a room, you assess even things like the shape of the room, the window, is it a bay window, is it a curve, is it a hexagon shape is it straight? The room layout even before you think about the appliance and the product you’re going to sell the customer, without ourselves that’s first and foremost because it’s not about the sale.
Alex: Yeah and I thought it was surely on stoves and fires most people just look at what’s the output, try and match it with a sort of vague room dimension and then you’re done with it, but it’s more than that isn’t it?
Chris: That’s the way that a lot of shops and showrooms still work because it’s all about the sale. With ourselves it’s about, yes, it’s about the here and now but it’s about the future, how is it going to best work for the family. There’s many things, have they got children now or are they expecting children, did they plan for children in the room so therefore we don’t want to take up too much space in the room because the child is going to be playing so therefore we might not go for a full chimney breast, we might go for a inset balance flue fire, which could be either a hole in the wall or inset.
Alex: Just talking through the flue option there as you said if you don’t have the chimney there’s a flue option that you can base as long as you’ve got a external wall you can make it happen.
Chris: Yeah if it’s on a external wall you’ve got your power flue option which basically is a hole in the wall which has got a external fan and that pulls the combustion out and through the wall. With that the downside is you get a draft when the fires not on and if you ever had a power cut the gas can’t come through. The best market now is balance flue, which is basically a glass fronted, high efficiency gas fire, they range from about 80% to in excess of 90% efficiency. So, in terms of efficiency because a lot of people don’t understand efficiency we created a layman’s terms of how to understand efficiency. If you physically put £1 of gas into a fire, it’s how much heat you get on your legs. So, for a gas fronted fire you’re taking 80-90p into the room, onto your legs, the rest of it is lost through the flue, through the product of combustion, weight and heat, many different things. You’ve then got your open-fronted fires and with them they range from around 50-75% efficient but the industry has changed quite a lot and is now a lot more focussed around energy efficiency.
Alex: And is that the new frontier at the moment, is that where the latest technology is being ploughed into the industry, it’s all about energy efficiency, or are there any other avenues as well being looked at?
Chris: The industry went down a different route, so they went down the glass fronted industry peaked quite a lot, but the cosmetic side of it wasn’t quite as good, wasn’t as appealing as open fronted fires. An open fronted fire, even when it’s off, you’ve still got a look of the coals or the logs or the pebbles, you can physically touch them, and you can see them a lot easier so cosmetically they’re a lot more appealing, but the efficiency rating isn’t as high. So, then you’ve got the glass fronted fires. You’ve got the glass in front, you’ve got the coals or the other cosmetic, whether it’s the coals or pebbles behind and cosmetically it doesn’t look as nice because you’ve got reflection or a shadow so the industry went through a big change and the glass fronted fires now are a lot more appealing and the fuel beds have changed and whether it’s the angle, how the cosmetic look of them, the glass is now non-reflective, there’s a lot of changes. So, the glass-fronted market for the high efficiency has improved a lot but the open fronted as well has because now there’s a different category so you’ve got high efficiency, so you’ve got open fronted and then you’ve got open fronted high efficiency. The open fronted is if you look at the fire, there’s the face of the fire, you’ve got what I call is face value, how much air can be drawn through that face at any given time. Now for a glass fronted it’s minimal because there’s glass there so there’s not much air to pull through as you can imagine as you watch it, it only pulls through the top of the fire and through the bottom. Now, with the open fronted fire the face value is a lot more dramatic because you’ve just got the canopy and then all the coals or whatever the cosmetic lay out is so you’ve then got the open fronted AG so it’s still open, you’ve still got all the cosmetic stuff but the canopy is slightly bigger and you’ve got the convector on there as well so the face value is slightly reduced so the visual look of it you see less of the fuel bed but cosmetically its still more pleasing.
Alex: Chris, thanks so much and also if people want to get in touch with you, what are the best ways?
Chris: You can contact us via telephone and that’s Huddersfield 01484 644464 or you can visit our websites, easyfireplace.co.uk or envyfireplace.co.uk We do cover all of Yorkshire so please don’t hesitate to get in contact and we’re here to help.
Alex: Fantastic, thanks very much indeed again Chris.
Chris: Thank you.
Alex: The property hospital is all about me answering your property concerns and demystifying the process. Now this week I’m answering a question from Tom who’s got this to say.
Tom: Hi Alex, I’m thinking of going on the market because I’ve seen a property that I like, but, if I don’t get it I don’t know what to do. I’d really appreciate your insight on this please.
Alex: Tom, look please be careful here and you’re absolutely right to ask. Remember that nowadays the market is very transparent and there’s lots of websites out there recording all sorts of information about your potential house sale. Now as soon as you launch onto the open market these websites effectively press record and you start leaving what is called a digital footprint. Now, this is actually quite difficult to get rid of. I say this because if you’re going to go on to the market you must do it for the right reasons and have a plan B if you do not secure the property you ideally want. It’s not advisable nowadays to dip your toe into the water and test the market only to find that the property you wanted has gone under offer, you then withdraw your property from the market and you leave behind the digital footprint that can be looked at in years to come and you don’t want to give the market the wrong impression about your home when you really do want sell when that time comes. So overall my advice is if you want to sell then do it for all of the right reasons and go for it. If you just want to test the market, to gauge a reaction or indeed try and secure just that one single property then almost hold back and question your motivations to sell. If you’re unsure you only need give me a call. I hope this helps.
Jon: Jon Charters-Reed
Jon: Charters Reed Surveyors
Voiceover: Years experience?
Alex: We’ve got Jon Charters-Reed here in the studio, a very interesting chap indeed. Now Jon, just tell everyone, you’ve got a few accreditations to your name, which is a bit more unusual than most surveyors out there I think it’s fair to be said.
Jon: Yeah definitely, I began my career as a classically trained York Minster Joiner, went on to become a chartered surveyor, a chartered builder and I’m also a chartered building engineer.
Alex: You’ve got a lot going on there, a lot going on and I think what’s quite interesting is because you’ve got the building background I think there was quite a famous story involved in that as well.
Jon: There was, we’ve had a few incidents where properties have suffered from structural movement, no one didn’t know what to do or how to fix them, so we took our own digger, underpinned it and guaranteed it ourselves.
Alex: That’s what you call an in-house one-stop surveyor shop. I don’t know many surveyors that will go and survey a property and then go and fix it and guarantee it themselves, that’s pretty impressive stuff. I just want to talk through the different types of survey, I think there are a lot of home buyers and indeed home sellers who get themselves into a bit of a spin as to what level they require and what the actual differences are. Just talk everyone through that.
Jon: Ok well before we do let’s just look at the reason why you have a survey and at the moment it’s all the wrong way round because there’s a basic valuation which tells you what the property’s worth and in essence that’s a bank valuation usually, and you’re lucky if that’s one sheet of paper, you don’t normally get to see it as the property purchaser. Now it’s slightly incorrect as how do you know what the property’s worth if you don’t know it’s condition? For that reason, Alex, that’s why you should have a survey first before you get the valuation. I looked around a 1649 property a few weeks ago and it had horrendous defects and it does have an effect on value, needless to say the costs of repairs is not a straight forward deduction off the market appraisal.
Alex: No indeed and what are the survey types?
Jon: What we have is your basic survey, is the industry standard is the RICS home buyers report. It’s quite a restrictive report because it has traffic lights in it and we often do 4/5 surveys a week where someone’s had the RICS home buyers report, its not clear, its not easy to understand and we’ve been asked to do a subsequent report on it just to highlight effectively what the deficiencies are in there.
Alex: Is it often where banks offer that because sometimes they do this overall package where they will give you a survey and I guess very often because it’s a lower grade one it’s cheaper for them?
Jon: Exactly, so the banks are being rather naughty because one of the things I’ve said in my book, How to be A Smarter House Buyer, is that the banks are not treating customers fairly, they are carrying out restrictive practices because if you go to the bank for a mortgage and they offer you a mortgage, they must give you the opportunity to get your own independent surveyor.
Alex: What is the next type or survey that you need to get?
Jon: Most individual private practices will offer their own version of that which is usually full of common sense and not standard phrases. So, you get your level 2 scheme which is one above evaluation, then you get your building survey which is suitable for older houses. What you must remember is that Yorkshire has got a plethora of terraced houses, most of them getting on for 120 years old and they too are likely candidates for a building survey.
Alex: So that is sort of the step 2, the next grade up, I think some surveyors call it an infrastructure survey.
Jon: Sometimes its got a number of names, its sometimes called a building survey, or a mains structure survey and you need to be extremely careful because there are a number of companies out there offering a building survey, charging a fortune and it’s four pages long.
Alex: How long are yours then?
Jon: 40-50 pages long and 40-70,000 words because the thing is that everyone needs to understand is that your home that you are buying is ostensibly the family silver and so why would you skim on going for the cheapest survey on something that is literally worth thousands and it’s your future?
Alex: No, I quite agree. Again, I think there’s confusion over formal valuations and sometimes I think estate agents offer these. Under what circumstance would someone say I want a formal valuation? What are they and in what situation?
Jon: So formal valuations usually begin with a probate valuation or a valuation for tax purposes or a matrimonial valuation. The banks will ask for a valuation because its part of the banks and building society’s acts and regulations that the bank need a valuation to know the property’s value and so the banks are quite canny because they’ll charge the customers up to £600/700 for a valuation which literally is one to two pieces of paper and they’ll keep 60-70% of the fee but they won’t tell you that.
Alex: No indeed, but can you get involved if I needed a formal valuation?
Jon: There’s no reason based on what we’ve previously said about the council of mortgage lenders why a house buyer cannot insist on their own survey. If the bank turns around says you need to use our panel of approved surveyors, its restrictive practice and it’s tantamount to being illegal.
Alex: It is and if you, you’ve gone very specific and ruled out a lot of other options, at the end of the day the clients or the home owner or the house purchaser is actually losing out at the end of the day.
Jon: You can choose your own solicitor, you can choose your own accountant and you can choose your own mortgage adviser. We need to be quite clear that the banks have got to stop behaving like this. I have spent 5 years researching this plus my 25 years in the business in order to create the book that I’ve written.
Alex: So, this is the next horizon, the next sort of scandal in the bank world potentially, certainly sounds as though its heading that way.
Jon: Definitely, we’ve already spoke to a couple of law firms that are interested in setting up departments to actually tackle what is effectively almost an in-house type of mortgage fraud by the banks really.
Alex: So, its setting up a monopoly on it all?
Jon: Definitely and it needs to stop and hence the birth of the smarter house buyer because people have got a lot more savvy as to what’s going on in the world.
Alex: You mentioned your book, I know that’s just recently come out. Just talk where is it, what’s it about?
Jon: It’s called How to be A Smarter House Buyer. Its available in Waterstones and on Amazon, paperback and Kindle. In essence it highlights the deficiencies in the housing market which effectively after the recession became broken we’re still using similar methods for selling and buying houses and advising people how to get mortgages that we we’re doing 10-15 years ago. It gives people tips on how to choose a good estate agent and try to do a bit of mystery shopping.
Alex: That was certainly in an article I’ve just written actually and do mystery shop them, go in behind the scenes and see how well you’re greeted as perspective purchaser if you’re looking to sell a house, I certainly agree wholeheartedly with that. Again, another phrase that’s thrown up is RICS Red Book Evaluation, just to be clear this is formal valuation and it’s what you talk through effectively but what is it? How do you actually go about it?
Jon: Ok so the RICS Red Book its in essence a large book, its red and as thick as the London Yellow Pages and it’s got a whole load of practice statements and guidelines that we have to comply with in order to provide an evaluation. Now interestingly enough when the banks are instructing surveyors in this closed shop environment to carry out an evaluation a lot of companies are not complying to this evaluation. So, I’ll give you another example, a lot of companies will go and do a bank valuation on a house and they won’t look in the loft and there is some practice statements now that say surveyors don’t need to look in the loft on valuations. Now to me this is wrong because the loft, which is probably a third of the property and you know its often the Pandora’s box which can reveal an awful lot of stuff and again lets take the average house price, you know £289,000, you’re buying a house, you’re getting a valuation, you’re paying a load of money for it, you’re not even getting to see it, you don’t know anything you’re getting, they’ve not even looked at two thirds of the house, how can that be right?
Alex: I quite agree, you must have in your years of experience quite a few embarrassing stories for us surely?
Jon: One of my favourite stories is going into a property as younger surveyor, and going into the garden of the property and shall we say the lady wasn’t petite, and it was a summers day and the lady was in her birthday suit and all I could do was offer her my clipboard, but it didn’t serve a purpose in covering a awful lot up really.
Alex: You really need a bigger clipboard Jon. How can everyone get in touch with you? As I’ve said you’ve got a lot of accreditations to your name, where are you based and what are your contact details?
Jon: You can get in touch with our Leeds or Harrogate office and if they type in Charters Reed Surveyors into Google we shall pop up on the screen. You can also contact us on our Harrogate number which is 01423 259601.
Alex: Jon, thank you so much, a fascinating insight as always, really appreciate you coming on the show.
Jon: Thanks very much indeed, take care.
Alex: When you’re selling your home, it is the little touches that help. A couple of neat little tricks for you. Firstly, make sure you have your windows professionally cleaned inside and out so they have a sparkle finish to the property, really does make such a difference, especially on large windows overlooking the garden say. Another tip is to ensure that any overhead light bulbs are high wattages. If you have the energy efficient versions, ensure you have them turned on in advance of any viewings so they have time to warm up and get to full candessence. Equally for side lights make sure you’ve got them appropriately positioned in dark corners but ensure they’re lower wattage. You want your rooms to feel cosy and comfortable rather than emblazoned in dazzling light throughout. Final point, your front door and to either side should be in show home condition. Paint your door, have some potted plants either side. First impressions really do count.
That’s the Alex Goldstein Property Show and yet again some amazing top tips and features. If you need expert information, videos and up to the minute property news then head over to my website alexgoldstein.co.uk Alternatively if you require personalised advice when it comes to buying or selling your property please get in touch directly. The next episode is out on the 1 March so make sure you tune in for that. Until next time.