But until the UK housing market came crashing down just over a year ago, property development really did appear to offer guaranteed returns that far outstripped the actual value added, on the back of a boom fuelled largely by the now defunct era of cheap credit and mortgages based on the amount people could afford to borrow rather than their ability to repay.
As the supremely confident and yet remarkably down-to-earth presenter of Property Ladder - which, along with shows such as The Million Pound Property Experiment and Grand Designs, was at least partly responsible for promoting the concept of renovating houses for a living to a wider audience - and a successful property developer herself, Sarah Beeny saw at first hand just how easy it was to cash in on a market on the up.
Now, though, things are different, prompting her to channel her considerable entrepreneurial energies into a personal crusade to prevent the housing market from meltdown - with some predicting price falls of as much as 30% - through the launch of www.completingchains.com. It's a lofty ambition, made all the more demanding by the fact she's just finished a period of maternity leave and juggles her work commitments with looking after her three young sons, but her confidence in this latest venture - as, you suspect, in everything she does - is unshakeable.
Designed as a tool for estate agents that she hopes will also be demanded by homeowners, Beeny believes the website will allow homeowners to regain control of the market, initially by creating virtual chains based on people who have expressed a solid interest in a particular property. The idea is to then establish a real-life chain that lacks only a first-time buyer, and then to identify a price at which one could be found for the bottom house and for the whole chain to club together to find the funds needed to bring that property down to that level.
"On a £300,000 house if prices drop by 30% you'd have to take it down by £90,000," explains Beeny. "With this, you'd each take only £5,000 off and pass it down to the first-time buyer who buys a cheaper house. This way people can move without taking massive price drops, first-time buyers get cheaper houses and estate agents don't go out of business."
It's a novel concept and one that turns the conventional way of selling a house - where chains are usually built from the bottom up and vendors encouraged to sell before they start looking for houses - on its head. It does, however, rely on people setting realistic prices for their properties in the first place and will need a critical mass of estate agents to sign up soon if it is to stop the housing decline in its tracks.
"Internet sites are the quickest way to lose a lot of money very fast.
Tread very carefully and only do it if you're absolutely convinced it's
going to be successful'
Although initially designed as an answer to a cyclical crisis, Beeny is adamant this will become the way houses are bought and sold in the future. "It will stabilise the property market and keep property at a level that people can afford," she says. "We're not going to get real bargain properties out of it but it will stop the ridiculous yo-yoing of the market."
Online passion
Completingchains may have been born out of Beeny's original love but it isn't her first internet venture. Back in 2005 she broke out of her traditional property niche to establish mysinglefriend.com, an online dating site which has now become the most successful in the UK. Like completingchains, there's a twist. People don't post themselves on the site but are instead put there by their friends, with the individual in question given the opportunity to respond to their nominee's profile of them.
The result, says Beeny, is a network of single people who can judge others not just by their profiles but also their choice of friend, and dozens of couples who owe their relationship - and in some cases marriage and children - at least indirectly to the housing-developer-turned-matchmaker.
"It was an idea I had in the middle of the night," she recalls. "I've always liked setting people up because I'm very bossy and I like meddling in other people's affairs. It was born out of having friends that I introduced to each other. Then I got my friends to tell me about their single friends and I thought about what would happen if I put them on a dating site. I think selling yourself is a very hard thing to do and it's especially difficult in terms of your personal life. You either sound ugly or conceited."
The website - in which Beeny and her husband have a 50% stake - currently employs around 20 people and is a round-the-clock operation, although it is Beeny's business partner Amanda Christie who runs it on a day-to-day basis. "We get great results; we have endless weddings and babies and relationships," she says. "I meet somebody every week who's met their partner through mysinglefriend so we know it works."
But - like property - the internet is not an easy option for entrepreneurs. "Internet businesses are much more expensive than you'd think," she says. "In my opinion it's a much scarier investment to start up an internet site [than develop a property] because they cost many thousands of pounds to set up and if it doesn't work out it's money down the drain. But with a development you buy the property and you have an asset."
Her advice for anyone thinking of setting up an online business is as straightforward as the nuggets of wisdom she offers on Property Ladder. "You've got to be 100% confident that it's a) required, b) useful and c) that people are going to be interested in it," she warns. "You've got to be 100% behind the concept. If you have a moment's wavering thoughts don't go there because internet sites are the quickest way to lose a lot of money very fast. Tread very carefully and only do it if you're absolutely convinced it's going to be successful."
"The most important thing is cashflow. One of the things I see people
do a lot is massaging their figures to make them feel like they've made
a profit. That's ludicrous because in a few years' time they'll have
gone bust and won't understand why'
Indeed, in many ways Beeny is an unlikely dotcom entrepreneur. She admits she has no idea of the technology required to build a site and her intensely logical mind struggles to cope with the idea of using the internet for anything other than a particular end. "I can't get my head around the fact that there are some people who spend all evening every evening on the internet," she says. "That's really alien to me. I go onto the internet to buy a book or use a service but there are people who just hang around on the internet. Maybe it's because of the age I am and the fact that when I was a child there wasn't the internet."Family fortunes
Instead, Beeny spent much of her childhood on various building sites with her self-employed architect father and believes a career in property was a natural progression. "I do think you're slightly indoctrinated in what you want to do by your parents and my father used to cut out articles about Anita Roddick or Richard Branson, not about somebody who was managing a bank," she recalls. "It's what I always assumed I'd do."
At the age of 24, and after a string of "horrible jobs" including washing up and a stint selling vacuum cleaners, Beeny started her first property venture with her brother and future husband Graham, who she has been with since the age of 19. She now owns two property companies, one a rental investment unit and the other a renovation firm.
But it took a chance conversation at a party to propel Beeny onto the nation's television screens in 2000; her fresh-faced appearance, common sense approach and sheer enthusiasm for all things house-related capturing the vigour of a market that was set for a period of unabashed expansion which would only end with the onset of the credit crunch. "I knew absolutely nothing at all about television but it sounded fun and went for a screen test," she said. "They told me about the show and I said I didn't think it was a very good idea and that no one would watch it."
She ended up presenting the first eight series of what would become a cult programme and will again front the ninth when it is broadcast in spring 2009, as well as a number of other shows along the way such as Streets Ahead and Britain's Best Homes, which she describes as "property porn".
"You get a lot of reward from watching something like Grand Designs or Property Ladder because within an hour of sitting on the sofa you get to see a house that's gone from being a complete wreck to completely finished," she says. "I think that's one of the reasons why people think they might do it, because they've eaten a bag of popcorn and suddenly someone's made £40,000. But they've bypassed the fact that these people have actually spent a year and a half crying over it."
Property Ladder also meant Beeny witnessed at first-hand the mistakes made by inexperienced developers lured by the prospect of huge returns and in part inspired by the very programme she fronted. Indeed, she cites the biggest mistake she has made as getting into too much debt and says the biggest thing a property entrepreneur can do is to make sure they buy at the right price. "The most important thing in any business is cashflow. One of the things I see people do a lot is massaging their figures to make them feel like they've made a profit," she says. "That's ludicrous because in a few years' time they'll have gone bust and won't understand why. If a business isn't profitable it's not a business."
Home comforts
‘I do think you're slightly indoctrinated in what you want to do by
your parents and my father used to cut out articles about Anita Roddick
or Richard Branson, not about somebody who was managing a bank'
If there is an upside to the downturn, Beeny believes it is that it might act as a reality check for those who believed making money from property was easy. "There were a lot of people who bought a property and painted the kitchen yellow and a year later their house was worth £100,000 more and they thought they could develop," she says.
But those who make a living from property development will have no choice but to continue, despite the current climate; another reason why she thinks she had an obligation to pursue completingchains. "In this kind of market you have to take on a long-term project, so you may take on a site with multiple houses or bigger sites that are going to take a long time," she says. "But the thing about developing is that you're actually producing something that people need to live in. You're not just gambling on the market; and to a certain extent that can act as a buffer."
Her own ambitions for the future are more reserved. She's sure there are more businesses in her yet - she has visions of building an eco-house and running a children's petting farm in Dorset - but is content to play the "baby game" for the moment. "I have a two-year-old, a four-year-old and a three-month-old so I'm right in the middle of having babies which takes a tremendous amount of time," she says. "I'm not putting a lot of pressure on myself to achieve a great deal at the moment."
Apart from, that is, almost single-handedly saving the country's housing market - and possibly the UK economy - from total disaster. Beeny is supremely confident her latest venture will work and if it does believes it will be her biggest triumph to date. "To think that when there was a recession and a massive downturn in this country it was alleviated by something so simple just because I could be bothered to get onboard and let everybody know about it would make it the thing that I'm most proud of," she says.
"Although a closely run second is when people send in photos of babies they've had when they met on mysinglefriend," she adds. "That's an amazing sense of achievement; to think that those people wouldn't have met otherwise. I think the two things people most care about in life are where they live and who they live with and that's probably why I'm doing the things that I am. If you can live where you want to live with the person you want to live with, that's good enough for me."
Extract from full interview conducted by Nick Martindale for New Business magazine
