The market is stirring. The holidays are now becoming a distant memory, schools are back and anyone who intends to move in time for the New Year is beginning to think about doing so.
Although nationally activity levels remain unexciting and, as a consequence, prices are remaining high, there is an indication that this could be about to change, led as ever from London where, according to Savills, prices have fallen by 3.2% since the beginning of the year.
We can see two possible reasons for this about-turn. First, the Brexit referendum and subsequent election introduced confusion and severe uncertainty to an already fragile market. This led to a log-jam of people who would have liked to have moved, but were nervous to do so. Now that the shockwaves have passed, they once again feel more confident about moving.
Secondly, talk about the possibility of SDLT (Stamp Duty) liability being passed from buyer to seller has encouraged a number of sellers to bring forward their plans to sell. This makes sense, although if those sellers are also buyers then it’s probably swings and roundabouts.
Whilst we do of course welcome the expected increase in activity due to a rise in the number of properties coming to market, sellers should always be conscious of the effect of this increased competition at local level.
Make sure you get an accurate valuation from an experienced local agent. Online valuations are a great way of gauging an approximate idea of what your property is worth, however it is essential that you seek the advice of a knowledgeable local estate agent who has their finger on the pulse. Ask the agent to tell you what is happening in the local market, and to show you examples of similar properties which they have recently sold.
We do expect the lower end of the market to become more accessible to first-time buyers, and sales to this sector are already up 17% over the past two years. This is no doubt due to the fact that buy-to-bet investments are proving less attractive to the “amateur landlord” with BTL purchases down 17% in the same period (Source: Land Reg). This could be due to a much tougher SDLT and personal tax regime, freeing up properties that would otherwise be let. Sadly for tenants, this effect is already being felt, with 35% of rents having risen (source ARLA).
Until the Brexit issue is finally resolved (ha!) the market will remain difficult to predict, but in the meantime we’re helping our clients make hay while the last of the summer sun continues to shine.
©Copyright Richard Rawlings 2017 except where excluded under licence.