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| Market Report – 4th Quarter 2009
Don’t say it too loudly, but there appears to be something of a recovery going on in the market at the moment. Buyers are starting to feel much more confident about buying property and are discovering that a significant lack of supply is resulting in a degree of competition for good properties that we haven’t seen for some time.
‘What about all the repossessed houses and flats?’ I hear you cry. ‘Hasn’t there been a 20% fall in values across the board?’. It is very easy for people to apply house price figures that are actually a reflection of what is going on nationally to the local situation, and the two are often very different. For example, there has been an over-supply in Canterbury of new build apartments, and this sector of the market has consequently suffered the biggest hit in terms of falling property values, but there is a local shortage of good quality three bedroom family homes at around the £250,000 level which has resulted in a definite firming up of values for these properties.
Before we all get swept away by this upturn, however, I think a degree of caution is appropriate. Investors, many of whom have been able to make their purchases with cash, have been a very significant source of business for estate agents over the last six months, and they have been driven by a combination of very low investment returns elsewhere and a sense that there are one or two property bargains to be had. This scenario is now changing – the stock market is enjoying a bull run, and the merry men (and women) in the estate agency universe, in the pursuit of those hard-to-win instructions, are predictably starting to put, shall we say, ‘robust’ figures on their asking prices, making bargains much more difficult to find. In addition, those buyers who require a mortgage will find that their surveyor (who is working for the lender as much as the buyer) will tend to take a fairly conservative line when valuing, and excessive exuberance in terms of prices is very often curtailed at this point in the transaction!
Where is it all going to end? Are we on the threshold of another balmy (if you are a homeowner, at least) period of rising house prices? Or are we experiencing, to coin a particularly unpleasant turn of phrase, a ‘dead cat bounce’? Well, in the absence of a crystal ball, it’s tricky to say. Vendors would be well advised to ask a sensible price for their property and instruct an agent whom they are confident has plenty of experience of the local market for their sort of property, and who will work as hard this year to find a good quality buyer this year as was required last year (which is to say – very hard!), and buyers should be confident that, when buying a decent property at a sensible price, they are onto a proven (long-term) winner.
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