Disruptive London property model looks North for expansion

A fast-expanding property group that claims to generate revenue for estate agents through sophisticated technology is striking out from its London base to the North West, with Manchester its initial destination.

Houzen says it wins new instructions for estate agents in the face of tough market conditions.

It says in light of the strong growth in demand for its services, it is planning a major expansion, with plans to open offices in five new cities by 2020, starting with Manchester.

Further openings in Birmingham, Edinburgh, Liverpool and Dublin will follow within the next 18 months.

Houzen said the June 2019 RICS UK Residential Market Survey observes a slightly steadier market, albeit one that has seen significant declines in buyer enquiries during the first early part of this year.

Yet, despite a small rise in buyer demand and new instructions to sell holding steady, RICS reports that, “much of the anecdotal commentary remains a little downbeat.”

The firm said this is why its service is such a relief to many agents.

Houzen operates primarily in the London area at present, though it has already begun its expansion, having launched a Build to Rent scheme with Europa Capital in Manchester earlier this year and is currently in discussion with several other developers in the city.

The company said it specialises in working with Build to Rent operators, bringing premium instructions to local and independent agents, rather than leaving them in the domain of only the largest corporate agencies, as has previously been the case.

With significant investment and banking experience behind them, the Houzen team said they are breaking the mould, essentially doing for new instructions what Rightmove did for applicants back in 2000. With Houzen’s support, estate agents can focus on closing deals rather than having to find them, it says.

The number of estate agents closing – figures for this vary, but some outlets claim that more than 1,200 high street agencies closed in 2018 – is reflective of the tougher environment that such organisations are facing.

Houzen said its hope is that the lifeline that its platform offers to local agents through the supply of premium instructions will support them to stay in business, despite the current market conditions.

Each of the cities earmarked for expansion has been chosen for its own unique blend of opportunities.

Liverpool, for example, is a key Build to Rent growth area, with strong political support behind the provision of new, high quality homes for ‘Generation Rent’.

Dublin, as another example, has seen an influx of institutional investors over the past 12 months, with hundreds of new apartments acquired as investors snap up whole developments in order to rent them out.

Saurabh Saxena, the ex-banker and private equity strategist at the helm of the Houzen brand, said: “There’s no doubt that these are tricky times for estate agents and many of those suffering are the smaller, independent agencies where daily admin can reduce the time spent closing deals.

“Finding new instructions is part of that admin.

“By significantly reducing the time needed for that task, we are providing agents with more time to focus on what they do best, as well as opening up premium instructions like never before.”

Houzen said its team leverages their private equity background, and extracts deep insights from global property data, which, in turn, helps to underwrite sales and rental projects with confidence – and close deals three times faster.

It said its clients have been able to refinance in record time, reduce overall lease-up time by approximately 30%, thereby adding millions to their bottom lines.

Houzen added that it specialises in BTR projects and is able to hand-pick applicants in real time, and pre-sell to premium tenants using demographic customisation.

However, thanks to its global databases of tenants and buyers, it is able to take on all kinds of schemes and projects, it said.