Out foxed by Foxtons

When we decided to buy a house, we had been living in and around Wapping for about 6 or so years. We had an idea of which buildings we would like to live in, which we thought we could afford and which we weren’t keen on.

We rang all the estate agents in the area and sent them emails expressing an interest, set out what we wanted, where we wanted to live and what our budget was. Some listed off properties that we might want to view, others said they’d get back to us and some didn’t. Phoenix Properties for example replied to my message exactly one year after we had moved into the property we bought.

What current property buyers (and we found) is that really, the internet is all you need in looking for property. Sites like Zoopla and Rightmove have every property from every estate agent there in front of you: pretty much like a price comparison website. You stick in your budget, the number of rooms and the area and away you go. Essentially it has turned the estate agent into a glorified key fob on legs, just to let you in.

However, much like the inane banter I actively avoid at the barber, you have to let the estate agent feel important. For example, Felicity J Lord insisted on taking us to see a property towards Aldgate which had been repossessed by a bank and in some small minded act the light bulbs had been removed. As we shuffled around in the dark trying to search out the much vaunted features that February evening, we realised that we had tolerated the agents of Wapping’s follies sufficiently and stuck to our guns.

So, two years on, we are to be graced with a new estate agent office in Wapping, a sparkling new Foxtons with complimentary sparkling water. Although Foxtons have been marketing Wapping properties for sometime from Shoreditch, I wonder whether they will force the other agents to up their customer service game? Based on a property alert email I received today, possibly yes, possibly not.

“This well presented two bedroom flat located on the second floor of a purpose-built apartment block offers a great living space with well proportioned interiors.”

The price: £400k
The location: Prusom St

Foxtons' spiel

I scratched my head and wondered where this flat was on Prusom St? The most expensive flat previously sold on Prusom St was an ex-local authority 3 bed flat in Malay House sold for £342k in October last year. It turns out on viewing the particulars that this flat is in Hilliard House, another ex local authority block.

I'm not an expert, but Malay House and Hilliard house look quite similar on the outside, so what are the selling points of this two bedroom flat that justify the price tag being set £60k higher?

Well clicking through onto the website I learn that:

 Hilliard House is located close to the range of shops and amenities in Tobacco Dock Shopping Villiage [sic].

I don’t know exactly when the tipping point was for Tobacco Dock but my understanding was that after the mid 1990s there was only Henry’s Café Bar (closed in the early 2000s?) and Frank and Steins sandwich bar (which closed in 2008). So unless you’re an events coordinator, there haven’t been any amenities there for six years and no shops for over 15 years. When you’re choosing an estate agent, Foxtons definitely have local knowledge in abundance! Perhaps its the 'perios' features that push up the price tag.

Or...perhaps it is the ambition of the estate agency. One thing of interest to house hunters is that property websites track when a property comes onto the market and the price it’s marketed at.

In researching properties in the area, I found another two bed flat in Hilliard House on mouseprice. It was listed in October 2013 at £335k and then the price went up to £340k three weeks ago. It was being marketed by EA2. Three days later it was sold subject to contract and its listed thus on EA2's website. Maybe the property marketed by Foxtons at £400k has had a refurb, with a kitchen fitted with high end units?

Well lets compare the particulars for the Foxtons property with those on mouseprice  and EA2's website.

	Foxtons	EA2/Mouseprice
Floor plan
Kitchen
Lounge
Bedroom

I might be wrong here, but it looks to me like Foxtons are selling the very same property that was just on the market at £340k for £400k.

I assume the situation is that they have taken an instruction on a sale that has just fallen through (seeing that EA2 still list it as sold subject to contract), something that we experienced (our vendor took the property off the market and then relisted with another agent to rent it after I suggested having a plug socket immediately above the hob might not be fully compliant with electrical safety standards).

Whatever the circumstances, it looks to me that Foxtons seem to promise they can deliver a price premium of 20% more than EA2. My understanding of the economics of real estate is that estate agents prefer quick sales rather than maximising sale proceeds by increasing the price but Foxtons appear to buck this thinking. Does the market set prices, or do estate agents? If the latter is true and the market is dysfunctional, caveat emptor Wappingers!