What Sarah did next…
We caught up with our cover star and serial entrepreneur about her latest project…
Tepilo. Or to give it its full domain name www.tepilo.com is a website you may not have heard of – yet.
But it’s the name Sarah Beeny has given to her latest venture. (Download the Tepilo supplement from our Sarah Beeny 2010 issue)
And if Sarah’s instincts are right (and when it comes to buying and selling property, she’s usually spot on), it’s a name that will soon be as familiar to house hunters and sellers as Rightmove or Foxtons. In a nutshell, Tepilo is a simple way for people to buy and sell (and even rent) their homes directly to each other and cuts out the need for estate agents.
Sure, it means in effect you become your own estate agent – you upload pictures of your house and write a description of your property that will appear on your web page. But, even better, because using Tepilo costs nothing – it is completely free for both the seller and the buyer – it also means you get to keep the commission you would otherwise have poured into an estate agent’s pocket. (Kerching!). Frankly, if you’ve got a house to sell, what’s not to like? If you’re an estate agent, well, you’re probably none too happy.
The idea for Tepilo is one that Sarah’s had bubbling on the back burner for some time. ‘I knew there was a market for Tepilo,’ she says, ‘because when I wanted this site it didn’t exist. ‘One of the great things about the internet is that it enables people to be their own brokers. We organise our own mortgages, look for our own savings accounts, plan our own holidays, book our own flights and find a hotel online. All the things we would have got a broker to do for us in the past. What the broker used to do is bring together the sellers and the buyers.
‘Twenty years ago if you wanted to buy a house you would go to your local estate agent. But now what happens is that the buyers go straight to internet and Google the area they’re looking to move to, the kind of house they’re looking for and how much they can afford to pay. So if most buyers are heading straight online, it occurred to me, why can’t the seller go straight online, too? The reason being is that the major property portals, like Rightmove and FindaProperty, are tools for estate agents,’ says Sarah. ‘If you want to have your property in-vision on the internet, only an estate agent can put up a property on the Rightmove or FindaProperty websites. And for the privilege of having an estate agent to do that, you have to place your property on its books.
‘It seemed crazy to me that the buyer heads straight to the internet, but the seller has go through an agent, paying lots of money along the way, around £5,000-£10,000 in fees, which is typically 2-3% of the value of the property, plus VAT. That’s a lot of cash to put your property on the internet. I think people have got better things to do with their hard-earned money. If I asked you what you’d want to do with £10,000, I’m betting it wouldn’t be to pay someone to show people around your house! That’s the equivalent of a new kitchen, an extension or an amazing holiday.’
With Tepilo, Sarah has built a tool that puts the control of the whole house-selling process firmly in the hands of the homeowner and potential buyers who are encouraged to communicate with each other via the site. The idea is that by cutting out the middleman – the estate agent – the transaction will go more smoothly. Sarah also believes that private selling may help to stabilise house prices and even bring them down a little. ‘On Tepilo, people will sell for the amount they’re offered. At the moment there’s a slop, which is the amount you know you have to pay out to the estate agent.’
The site is easy to use, and guides you through every stage of the process – from uploading pictures of your home and preparing for viewing through to completion. You can also sort out floor plans and a Home Information Pack (HIP) via the site. It will remind you when you have a viewing, and prompt you at various stages to check if you have your mortgage organised and when to contact your solicitor. ‘On Tepilo we try and make it very simple,’ says Sarah. ‘For me, websites have got to be simple and straightforward. I don’t really like internet sites that much myself, and Tepilo is built for people as non-internet savvy as me,’ she laughs. ‘It’s basic common sense, it just does it really well. Buying a house is not rocket science. If you can buy a pack of sausages from Sainsbury’s you can buy a house. You just pay your money and someone gives you the house in return – that’s it.’
And what better time to appeal to people’s pockets, when there’s not a house in the land that hasn’t been hit
by the rising cost of living? The money saved on estate agent’s commission by selling privately will be welcomed by homeowners with open arms. But, exactly how is Tepilo able to do forgo charging the traditional hefty chunk of commission? ‘ Our business partners, Codegent, who built the site, are award-winning web designers. And that is the main reason Tepilo has been so successful, because we have the most amazing site,’ says Sarah. ‘And we’ve got another brilliant partner called Will. We’ve got the best of the best who are all shareholders in the company. As a result, we’ve got a crack team who own the site.
We’ve had lots of people approach us about sponsoring the site, and we may consider this in the long-term. But ultimately, we’ll keep it free for the end user. For now, we’re biding our time. We just want to keep it clear, pure and simple. We don’t want it to be muddled by other stuff going on. We want it to be completely honest.
Alot of people have suggested that we could get kickbacks from organising mortgages and things like that. But we think, No, no, no. Because that’s slightly duplicitous. I just want everyone to know what Tepilo is. It’s free. And we get no money from it. We do link to other websites, but they’re just sites we thought were the best ones. For example, we found a HIP supplier that we thought was the best value and the most efficient. But no money’s made out of the relationship. I think, as soon as you start taking a fee, no matter how small, you start to question if you’re totally independent? And we wouldn’t
be, not really.
‘At the moment, I want Tepilo to be a great tool that works really, really well. And to do that, you need a lot of houses posted on site and a lot of buyers on the site. And we’re doing really well. We’re nearly at 10,000 properties. And people are selling. Yesterday, we had seven offers accepted on houses. And those are just the ones who told us, I don’t know what else is out there.’However, there’s one group of people less than thrilled with the arrival of Tepilo on the housing scene and Sarah’s ambition to revolutionise how we buy, sell and, even, rent our homes. Yep, no prizes for guessing there are some very unsettled estate agents watching Tepilo’s progress very, very closely. Already squeezed by the credit crunch, Sarah’s new venture threatens to put another dent in their battered revenues. So how does the industry feel about the arrival of Tepilo? Typically, Sarah’s response is sanguine. She’s been in the property business long enough to know how estate agents think. And she’s got a pretty good idea of how they’ll react to Tepilo, too. ‘One estate agent said “Sarah’s got blonde hair and is a bimbo”, she says with a laugh. ‘And I kind of think, What about Tepilo? I don’t really care what they think of me.
‘A couple of weeks ago there was a lovely article about us in the Saturday Telegraph,’ recalls Sarah. ‘It was great, very positive. And then, clearly a lot of estate agents had complained because there was an article, a right to reply almost, the following Saturday. But I have to be honest – all the criticism we’ve had from estate agents, doesn’t really stack up. I would be more interested to hear a valid argument as to why they think Tepilo’s a poor idea.’ Others argue that private sellers won’t be able price their own property. But again, Sarah is ready for this. ‘I know exactly how estate agents value houses, and it’s not rocket science. They just look at what else has sold in the area recently, and if they don’t know, they look online. So why can’t the homeowner look online at the Land Registry or various other websites that hold details of house sales across the country? After all, that’s all they do.
There’s an implication that estate agents have a weird, magical way of understanding house prices. But it’s basically guesswork,’ says Sarah. ‘Any mortgage valuer will do it the same way. So, for example, if you have a two-bedroom flat for sale, they’ll think, the two-bedroom flat down the road sold for £250,000, another sold for £275,000 but it was a bit bigger. So they’ll price your flat, that’s a bit smaller than the £250,000 one, around £240,000. That’s it. They’re just making a bit of a guess based on history. Now anyone who claims that is not how they value a house, is lying.’
One critic of the site even went so far as to say that inexperienced, homeowners posting photographs of their homes online, would be putting themselves at risk from burglars. It’s not an argument Sarah has heard before, and she’s bit perplexed by it. ‘I don’t see how, in terms of security, an estate agent gives you any better protection than Tepilo does? The only thing I would say is that we do have security guidelines on the site. And one of the things that we do encourage is that you communicate through the site. As I do think handing out your mobile number and email address to someone you don’t know is not the greatest of ideas. Being able to exchange information through Tepilo, is one of the strong points of the site. ‘To be honest, I’m still waiting for a really good response for why Tepilo is not a good idea. It would be great to get one where I think, Yes, that is a really good point. Tepilo is a really pants idea.
‘The truth is estate agents have had it pretty easy and they charge a flippin’ fortune, relatively speaking for what they’re doing, if you add it up per hour. And there was a very good reason for using them when they had all the marketing and none of us knew how to market ourselves. The internet has changed that. Like the record industry, they are going to have to understand that things are changing, and they’re going to have to deal with it. They can’t keep trying to simply block it out. ‘Don’t get me wrong, there are some great agents out there, who have a, really in-depth knowledge of the property in and around an area. How much houses have sold for. How big they are. And it’s very useful to know property in an area really, really well. It’s those agents who will always exist because they’ve got a head full of valuable historic knowledge and experienced negotiation skills. But I don’t think that means we all need cafés on the high street and branded cars. That’s why you have to pay out £10k commission because you’re paying for all of that. When really, it’s the person who’s extremely valuable, not the shop front. In the future, there will probably still be agents. Someone who’s very busy, and has an incredibly busy life, might use a personal agent. So I think it will be more on that basis.’
So how quickly do houses move through the site, say from putting it online to getting it sold? ‘There isn’t a case where every house only takes six weeks, because it depends on the house, says Sarah. ‘We had our first bidding war over the weekend. And seven houses went under offer, yesterday. Houses are selling, and they’re selling quickly on the site. But I don’t think the site is old enough to say that on average it’s around this time. We had a £4 million house, that was on the cover of the Telegraph the weekend before last, that sold on the site.’
Does she worry that people with smaller houses, might think Tepilo is not for them, and that an estate agent could get a better deal for their house? ‘In a recent article in the Telegraph, estate agents claimed they could get more money for a house than if the owner sold it themselves, as they’ll push and make the buyers pay more. So that says to me, as a buyer you’re probably better off not going through an estate agent, because they seem to think they can get more money for the seller. On Tepilo, we do have quite a big range of property – there’s expensive and there’s cheap. And we’re quite pleased that we’ve got such a good spread. It’s appealing to people from all walks of life.’
‘I think the reality is that people sell their houses for whatever they’re prepared to sell them for and makes sense in their lives,’ adds Sarah. ‘So, ultimately, it should be the owner who decides what they’re prepared to sell it for. And the buyer decides what they’re prepared to buy it for. It depends on your life. You may find a house that you think is really nice and decide to pay £20,000 more than the asking price because you love it, and it’s perfect for you. Or it might > not stack up and, therefore, you put in a lower offer. I’ve always slightly believed that an estate agent can’t sell you a house, it’s too much money. You can be sold a bag of oranges in the market. But you can’t be sold something that costs £100,000. It’s very good marketing to be able to sell someone something if they don’t actually want it.
‘I always say to people, if you like a house and you can’t pay the asking price, just put an offer in. Or if someone writes to me saying, they’re desperate to sell, I say reduce the price, significantly, even dramatically. Get an offer and then decide whether you’re going to accept it. Because it’s all very well saying, I can’t sleep and I feel sick because I haven’t got anyone viewing my house. You’re not going to conjure buyers out of the woodwork. Ultimately, make it cheaper, get an offer and then decide.’
But with house prices seemingly on the rise, if only a little, how do private sellers keep abreast of the market? Should they adjust their house prices accordingly or stick with their initial valuation? ‘The truth is there’s no golden rule that if house prices go up by 4%, you also put your house price up by 4%. It just doesn’t work like that. The value of your house, is based on the value of what has previously sold in the area. Before the credit crunch, mortgage valuers would try to pump up house prices a bit. Now they’re pumping them down a bit, because its safer. They had their knuckles rapped. So now they’re all being a bit pessimistic. Meanwhile, no one can get a mortgage. Because everyone is rounding prices down rather than rounding them up. The best way for you to value your house, is that you keep an eye on properties around you and see what has sold.
Basically, for the year before you want to sell, just keep a whether eye out as to what people are doing. There’s no greater science to it than that. But even then it’s just question of sticking it on the market and seeing if someone buys it.’ So will we ever go back to the days of 110% mortgages? ‘I do hope that we won’t go back to those days, because I don’t think anyone was better off for them. Owning a house is expensive. And to be throwing 110% mortgages to 18-year-olds straight out of school who can’t afford it, and then looking amazed and dazzled because they can’t repay it, is just irresponsible. A certain amount of struggling to buy a house, I don’t think is a terrible thing. And when people ask, how is anyone able to afford buy house without savings? I think, Well, yeah. If you want to buy a house, you’re going to have to save some money, that’s perfectly reasonable.
‘And mortgages are better than they were. You can now get mortgages fairly straightforwardly again. But if you compare it to 20 years ago, it’s a lot easier to get a mortgage now. Getting more than a 70% mortgage on a house 20 years ago was practically impossible. So I don’t accept that we want to go back to where we were before the credit crunch, and I don’t think we will, which is probably a good thing. Back then, having a 10% deposit to put down, meant you didn’t get a brilliant mortgage and you had to have a great job. And if you didn’t have a job that proved you earned loads and loads of money, you could do self-certified mortgage but you’d have to borrow less. ‘I think people forget the history and think now is really bad time because you can’t get an 120% mortgage. It was a very small window in which you could get that, and flippin’ mental anyway. I think now is an OK time.’
And what about all those would-be developers who want a piece of the property pie that helped her make her fortune and fame? Is now a bad time to attempt to get a business in bricks and mortar off the ground? Or do you have to be established to keep afloat in these tricky times? ‘No, I think you can still develop property,’ says Sarah, ‘but the basic rules still apply, more now than ever. And that is you’ve got to make sure your figures are right. What probably isn’t the case now, is that you can sail by on a really rubbish business plan and end up making money anyway. You probably can’t. Basically, what people were doing before was investing in property as if they were investing in stocks and shares. The house price went up, and they made money. Now you really need to do some work on property to make it worth more money. You have to be a bit more savvy about what you’re doing.’
So has her own property development company been hit? ‘No, that’s carried on. But we quietened down on the development side of things a few years before prices hit the top. There were lots of reasons for that decision, but an element of it was that the market didn’t feel right and we thought it was slightly better not to be too involved. I haven’t got a crystal ball and no one saw what was coming, but I’d think, What is going on? It’s completely mental?
‘The problem was, a few years before a lot of people felt the same way, and I remember saying, if prices go up this fast they’re going to come down just as quickly. And then, of course, the next year, prices went up again. For about four years, I stuck to my theory about prices crashing, but as each year passed it still didn’t happen. And people would say “she’s talking nonsense”. Finally, the year before the crash, when prices were zooming up, even I began to think I was wrong. There seemed to be no stopping it. I even started thinking we should just start buying more and more, because the market had just gone crazy. But it just took a bit longer than I was expecting for it to come crashing down.
Alongside her property portfolio, Sarah’s really busy with other businesses. ‘We’ve got a property investment company. And we’ve got MySingleFriend [her dating site] which is doing very well.’ What’s more, she’s got a new TV show coming soon. The Channel 4 series Help, My House Is Falling Down is due out later this year. As with Sarah’s previous shows, Property Ladder and Property Snakes And Ladders, she’s cast in the role of counsellor and mentor. This time around, though, it’s not amateur property developers seeking out her expertise to help them buy, renovate and sell at a profit, but desperate homeowners, whose houses are, err…, all but falling down.
‘We’re approached by house owners who’ve taken on a project that’s too big, and they’re out of their depth. And I try and help them get on track. We tackle things like chronic subsidence, chronic wet rot, rat infestations and black mould. I try to explain what the issues are and how to deal with them. One house had masses of mature trees so close to it, roots were growing through the drains. The house was so destabilised it was dangerous, and effectively falling down. The owners bought it not realising, and thought they could just fill the cracks. But the cracks kept coming back. She also has another show due out in the autumn which charts her trying to save and restore a listed building in Yorkshire that she has owned for 10 years. All she’ll say about it is that ‘it’s a hell of a project. Seriously massive.’
Of course the most important project in Sarah’s life is her family. Her husband, Graham, and their boys: Billy, five, Charlie, four, Rafferty, one, and Laurie, six months. So how has she taken to being mum to four boys in quite quick succession? ‘If I’m honest, I flippin’ love it,’ she says with a laugh. ‘It’s great. It’s really hard work, but it’s not unpleasant hard work. Graham works, too – he’s a fine artist – so our life can get a tad hectic at times. The difficulty is trying to fit other stuff in as well. And some things have had to go. About the same time as having children, we decided not to do as much property developing because I couldn’t quite fit it all in. I’ve had to slightly compartmentalise my life to keep on top of things. So on Mondays I’m in the office doing emails, which are quite horrendous in their quantity. On a day like today, I’ll do phone interviews, the accounts, bills and I write various articles. Tonight we’re going up to Yorkshire to the house with all the children, and we’ve got three days up there checking on what the builders are doing. Then we’re back down to London and I’ve got a day in the office on Friday. I try not to work at weekends.
‘I do feel a bit sorry for Graham, as he has a lot less of my time. He often jokes that he’s number six in my life, because he thinks he comes below the cat. But he doesn’t come below the cat and he doesn’t come below the kids, it’s just that he’s able to put his pants on in the morning, and they’re not. But to be honest, he’s a really hands-on dad. He’s exactly the amount of hands-on I would like to have in the father of my children. But we were together for 15 years before we had children and I always say to him, they’ll have left home before we know it and then there will be all the time in the world for us to lie around reading the weekend papers. It’s quite a small window, children.’
As if she doesn’t have enough to do Sarah has recently started writing a blog for Sainsbury’s. ‘I haven’t written that type of thing before, it basically sums up my life and I really enjoy it. Some entries are a bit more desperate than others. The one I wrote last night was about how I shaved off Billy’s hair. I’ve always had a slight obsession with clippers. So when I got a set, I thought I’d do a little test. And then it went horribly wrong. What I discovered is that once you start with clippers, you can’t stop. I put the number two end on, and started at the back and went, ooh, pants, err… Then did a bit more at the back and thought, OK, well, I’ll just do the sides. And it was like pulling a thread on a woollen jumper. As did it, I thought, Oh crikey, oh crikey, oh crikey… And then, of course when I got to the top, which I had to do because I’d done the rest of it, he went absolutely berserk, flailing around screaming, “stick my hair back on, stick it back on!”.
In desperation, I offered him the clippers to cut my hair. Fortunately, Graham came upstairs just in the nick of time. And just went: “No, you can shave my head, not hers”.’In such a male household, would they like a little girl? ‘Secretly, I think Graham would have quite liked a daughter; but neither of us has ever been that bothered. And he doesn’t want one enough to have another one. Although, funnily enough, when Graham came to pick me up from hospital after our last son was born, he bought the other three boys with him. We’ve got a seven seater car, and after we’d strapped them all in, we both turned around and looked at the boys in the back. Then Graham looked at me and said, “there’s an empty seat”. But we’ve decided that a fifth would be too much…’
Photographs: John Carey