Foxtons had become ‘flabby’ and lost its sense of business, its interim chief executive Peter Rollings claims.
Speaking on The Guild of Property Professionals’ Home Stretch podcast, Rollings explained the reasoning behind a recent overhaul of Foxtons that included replacing chief executive Nic Budden with Chestertons’ Guy Gittins who will join in September.
Rollings said: “In my view it had become a big flabby corporate that had lost its sense of why it is in business, which is to provide a great service and, bluntly, to get more money than anybody else could for our clients – that is our job and that is why we charge a premium fee.
“Whether we are able to do that or not is totally reliant on the business strategy, the people we employ, remuneration, training, marketing and an unshakeable belief that we’re better than the competition.”
Speaking to The Guild chief executive Iain McKenzie on the podcast, Rollings said that he cut his teeth in estate agency at Lane Fox & Partners before joining Foxtons Fulham as a negotiator in 1985.
Rollings rose within the business as it grew, being appointed as the Managing Director in 1997.
He left Foxtons in 2005 and purchased Marsh & Parsons, which sold in 2011, with Rollings exiting in 2016.
Rollings was invited to join the Foxtons board as non-executive director in December 2021 and told the podcast it was “bonkers” for a property business of this type to not have an estate agent on its board.
He said: “Every estate agency board should have a practitioner on it, someone who has sold or let properties and understands the business from the ground up.”
Justifying being able to charge an average 2.38% fee across its 61 London offices, Rollings added: “It is hard to do.
“We turn down quite a lot of stock. In a good market, it is difficult. It is in a tougher market that we really earn our stripes and grow.
“So, as we head into what we expect will be a somewhat tougher market for the next few months or year, I fully expect that we will grow market share. In terms of stock, we are the biggest agent in London, but whilst we have a lot of high-end stock (over 200 in excess of £2m) our ‘sweet spot’ is the mid-market in most areas we cover.
“We do ‘fee match’ at those higher levels, but our average sale price across London is £580,000, which in London is comparatively low. However, £580,000 at 2.5% to 3% is like most other agents selling £1.5m houses at 1% - that is the key.
“If you reduce your fee from, say, 2% to 1.5%, you have to sell 33% more properties just to stand still in a market that doesn’t hold more stock, so why bother. It is about sticking to your guns, fighting for the fee, and showing why you deserve it.”
- Listen to the full interview.