Property owners look to 'guardian' services post-Brexit

PA

Property owners wary of a post-Brexit plunge in prices are seeking out stop-gap "guardian" services in numbers not seen since the financial crisis.

Global Guardians, a cross between a security company and estate agent, has gone from managing about 200 properties before the vote to about 300 by mid-September - an increase that would usually take 12 months.

The group's founder and security director Stuart Woolgar told the Press Association that clients are waiting for another property price spike before putting flats and buildings up for sale, and are using guardianship to prevent financial losses in the meantime.

"I've been in the industry for over 10 years now, I've seen it fluctuate and grow, and it normally grows when there's a crisis, like in 2007...That caused a massive influx in new properties for guardians," Mr Woolgar said.

"Right now we're seeing exactly the same thing."

Agencies like Global Guardians manage empty homes, and turn more unconventional properties - like closed storefronts, pubs, and warehouses - into temporary, low cost accommodation, while safeguarding against squatters and drawing a small income for owners.

The majority of the agency's operations take place in London, but it also manages properties in cities like Brighton, Manchester and Birmingham.

The property market suffered a crisis of confidence in the weeks following the Brexit vote, with Bank of England figures showing that the number of mortgage approvals plunged to its lowest level since November 2014 in August.

However, the Council of Mortgage Lenders (CML) recently reported that mortgage lending rebounded in August - and the body said fears voiced in recent months about the housing market have ''proved to be wide of the mark''.

It is still unclear when confidence in the UK property market will be fully restored.

"For us it's strange because normally, growth is quick...but the last two or three months, it's been phenomenal growth. And it's all across the board, it's every sector," Mr Woolgar said.

Property investors, public sector groups, and private developers are getting in touch, with the agency's growing list of clients now includes real estate service firm JLL, as well as Hounslow and Southwark Councils.

Even commercial agents that manage empty office space are seeking out guardian services in a bid to tactically reduce business rates until they can find new tenants.

"Commercial occupiers are less likely to want a longer term lease now. The negotiations are being drawn out due to the Brexit, so it's harder for a commercial agent to find an occupier," Mr Woolgar said.

He has also noticed rising demand from overseas investors who have snapped up UK properties on the back of the sterling slump.

One Chinese investor bought "several streets of houses" in south east London from a local authority, but is working with Global Guardian until the property market stabilises.

"He's bought them, he's going to sit on them, wait for the value to go up and then he's going to be selling them off or rent them out, depending on what his numbers kind of point to," Mr Woolgar explained.

"Once we actually leave the EU, he's thinking the prices are going to go back up again, so he's looking at the long term view."

Brexit has also extended the average term of guardian contracts from about three months to 12 months or two-year terms.

The overall boost to business has prompted the agency to expand its workforce from 15 to 25 people, both to manage new clients and the 2,500 guardians spread across the country.

Mr Woolgar says Global Guardians is taking this opportunity to reinvest and develop the business, and therefore has seen profit margins drop to around 30-40% from 80-90%.

However, that is amid a rise in revenue, with turnover hitting £6 million in the 12 months to September from £4.5 million a year earlier.

"A lot of that has come from the last two months. Definitely," Mr Woolgar said.