PR: Tell us a bit about yourself and your role within the property industry
MS: I am VP of Revenue for Arthur Online and Fixflo in the UK. This role means I’m responsible for all customer-facing and revenue-generating functions: Sales, Marketing, Customer Success, Customer Support and Onboarding. It’s my role to ensure we’re delivering the right products and services to all of our customers.
I have made my career so far by working in technology across various sectors, initially in banking and insurance with Barclays and then AXA, where I was responsible for delivering innovative solutions with a clear commercial upside.
All this was against the backdrop of the Fintech revolution, so I was at the forefront of ensuring these organisations were keeping pace with emerging challenger brands. From there I moved to Peloton as one of the earliest employees in the international business, where I was responsible for all B2B2C distribution through commercial partnerships.
Overall, my career has been built on a combination of commercial-facing roles and largely focused on innovation and disruption in typically ‘traditional’ sectors. Having entered the Proptech space just over 12 months ago with Fixflo, one of the most forward-thinking organisations in the industry, I’m constantly inspired by the sector’s innovation, agent engagement and collaboration across new technology solutions.
PR: It is often said that lettings (and being a landlord) is a people business, not a property business. Is the PRS in danger of losing the 'human touch' as proptech continues to expand?
MS: Absolutely NOT! Deploying technology in the property space allows agents to have MORE of a human touch, not less of one — but it’s about the human touch at the right time.
How technology is deployed matters. We’ve all experienced the bad side of deployment such as poorly trained chatbots for customer service, and there you do feel like the human touch is lost. But when deployed correctly it should be seen as an enhancement, not a detractor.
At Fixflo and Arthur, we streamline processes that are arduous and time-consuming for businesses, to allow them to have more engaging conversations with landlords and tenants about the right things. We have lots of feedback from our clients telling us that by streamlining elements of their job, like Planned Preventative Maintenance, they can spend less time worrying about chasing contractors or lots of back and forth with a tenant about a gas safety certificate, and can instead focus on conversations that help drive revenue for their businesses.
Our focus is to deploy technology to automate the predictable things that don’t generate revenue and give our agents time to focus on speaking more to their landlords about the things that matter most.
PR: Although rate rises and mortgage costs have been identified as major factors to why landlords are leaving the PRS, arguably, increasing amounts of legislation are proving to be even more damaging. How do you see the Renters (Reform) Bill impacting already shaky ground?
MS: Having attended a lot of events recently, the general consensus is that regulation and standardisation is a good thing, not a bad one. If you’re a good agent who prides yourself on doing a good job, then standardisation can actually help you to become more efficient.
I think the difficulty though is the ambiguity and lack of clear direction, rather than the amount of legislation. It doesn’t help that we have had 16 housing ministers since 2010. If the polls are right, it looks like there may well be a change of government soon, and perhaps a change of priority along with it, so organisations are finding it difficult to future-proof for the unknown.
As it relates to the Renters (Reform) Bill, I think the overall direction is positive. We should want to ensure tenants have safe and comfortable places to live. Nearly a quarter of privately rented homes do not meet basic decency standards and that’s simply not good enough. On the landlord side, again I think there are a number of positives in what the bill intends to set out. It favours responsible landlords and removes risk around tenants who behave poorly.
The bill itself is solid in what it sets out to do, but with the implementation both in terms of details and final content still uncertain, it’s difficult for agents to plan effectively. Clarity on both timelines and the final content of the bill is needed swiftly so that agents can adequately prepare both themselves and their landlords for the future.
PR: What do you see are the biggest challenges facing landlords in the current climate and what advice would you give to help overcome them?
MS: In a word: cost. It’s becoming increasingly expensive to be a landlord in the UK market, driven recently by huge rate hikes which have impacted mortgages as well as the rising costs associated with maintaining properties to a good standard.
We have seen a number of landlords who have ultimately had to exit the market as in some cases their mortgage repayments have increased by 400%-500%. Even with increasing rents, it’s impossible to swallow that level of cost.
Firstly, it’s becoming increasingly expensive to maintain properties in the UK. Based on our data within Fixflo and Arthur, we’re continuing to see rising costs for maintenance due to a combination of factors.
Secondly, the housing stock in the UK is old. Over ¾ of housing stock in the PRS was built pre-1965 and over ⅓ is pre-1944. With ageing properties comes more wear and tear. Combine this with the shortage of good quality labour and rising material costs, it’s a perfect storm for landlords. There are 7 key steps that we are advising our agents and their landlords to implement to combat the rising cost challenges associated with maintenance:
1. Diagnose and triage maintenance issues.
2. Innovate — carry out video maintenance calls before physical call-out.
3. Implement a first-time fix strategy.
4. Ensure Planned Preventative Maintenance is organised ahead of time to avoid urgent call-out fees. 5. Educate property investors – high spec >> less frequent fixes & higher yield.
6. Maintain great contractor relationships.
7. Contractualise service levels and costs with contractors.
PR: What are your predictions for the PRS over the next 6-12 months?
MS: Increasing costs means that people are going to be more reliant on the private rental sector than ever before. Having spoken to one of our largest London-based clients recently, they told us that for the first time in recent memory, their lettings business is outperforming their sales business. The data corroborates this: Generation Rent (25-34-year-olds) are no longer the largest group in the PRS sector, with 34-49-year-olds who are struggling to get on the ladder overtaking them.
The growth of the PRS sector is attracting continued investment from institutional investors, and it looks like this is set to continue over the next couple of years. The reliability of the PRS against other investment vehicles such as the stock market — which is proving to be increasingly volatile — makes the PRS an attractive proposition for these investors. We’re seeing a flurry of acquisitions by institutional investors within our client base at the moment, and we may well see stock continue to move away from the individual landlord.
For the private landlord, it is more vital than ever to have a solid relationship with your agent, or if managing property yourself to have a great technology solution which makes this easier.
Rising costs and legislative uncertainty mean that expert advice through a managing agent is proving more and more valuable, and if self-managing, having technology can allow you to stay on top of documentation, flow of money and maintenance is vital for maintaining good tenant relationships and weathering any challenges that lie ahead.
