Autumn 2011

Activity in the housing market over the past six months has not followed the normal pattern, surprisingly July and August have been busy months with sales being agreed at realistic prices.
The market is very price sensitive, a significant problem at the moment is that there is a considerable amount of property currently available at the wrong price. Vendors need to be realistic with their asking price and become more in tune with the market. Prices are not increasing at the moment, if a property has been advertised for six weeks and there have been no offers, this would indicate that the price is too high for the particular property. The longer the house sits aroung the less likley it is to achieve the guide price.
Interestingly, online property search sites report that recently the actual average price paid for a property is 14% less than the actual asking price, again suggesting that property marketed in general is overpriced. I personally am aware of vendors accepting a reduction off the asking price to the tune of up to 23%, which is a significant amount of money when we are talking about homes at the upper end of the market.

Price aside, there are many interesting properties that seem to be coming to the Autumn market, cash buyers, as always, will still have the edge over other possible purchasers, being proceedable and more likely to reach exchange and completion as they are not held by a chain.

In summary, Vendors need to be realistic on price inorder to sell and buyers need to do their research to determine whether a property is correctly priced.

Summer 2011

Despite all the current turbulence in the economy the local property market is much busier than it has been for some time with a good number of new homes entering the market and sales being agreed at sensible prices.
The estate agents who were asked to carry out valuations in the Easter/Bank holiday period are now being instructed to offically market the new properties. The market is not becoming over supplied, this is simply helping to correct the great imbalance of sellers and purchasers in the upper end of the housing market where demand has been completely outstripping supply.

In order to be accepted as a serious buyer one needs to be in a position to proceed. If the current home needs to be sold before a purchase can be made, get onto the market and consider the possibility of renting when a good proceedable offer comes along. Cash is king in the current climate and the number of cash buyers in the Sussex market has increased dramatically. In 2005 cash purchases made up only 15% of the total transactions in the property market, this figure is currently running at 50% in the South East of England.

Summing up, the Sussex and Kent housing market is showing promising signs that the summer months will be a healthy and busy time.

Winter 2010

It is difficult to give an exact picture that fits the whole of the Sussex and Kent property market. The press and all the official indicies  report a very general countrywide picture that covers all price levels from one bed-roomed flats upwards, which obviously cannot reflect what is really happening in specific areas or at particular price levels.

The prominent estate agents have been reporting steady activity, showing that there are  focused purchasers still looking for the right home or business opportunity.  There are many properties that have been on the market for a while, these are often over priced with the vendor holding on to unrealistic expectations or they are a poor comparison to their competitors. Recently the balance has changed between supply and demand with the buyer being in a stronger position. Vendors now seem to be coming to the market with realistic asking prices instead of the bullish prices seen earlier in the year, the “best of type properties” are holding their value and will always continue to be in demand. Recently in Tunbridge Wells a period house with quarter of an acre of land requiring substantial renovation works attracted 100 viewings in  a three week period, achieving a 30% increase in asking price. This shows that there are still plenty of cash buyers looking for the right property in the right location!

With the Christmas Holiday period and snowy weather conditions I think we shall have to wait a little while before seeing a reasonable amount of new stock arrive on the market.

 

July 2010

The recent establishment of the new coalition government has seen one major change in the property market. The abolition of the much maligned HIP widely received across the property spectrum as a positive step.

At the same time interest rates have remained at 0.5% continuing a 15 month run, with a broad consensus that they will remain at this level or very close for the remainder of this year.

To gauge an accurate reflection of the overall property market remains an area fuelled by conflicting signals. The plethora of statistics provided by the market analysts whilst providing a barometer for general trends across the board, often do little to spotlight the nuances in area and price level. This can only really be understood through local knowledge and a comprehensive picture of vendor circumstances.

Whilst there are encouraging signs that the trend in the market is positive in terms of properties available and prices achieved, the overall picture is far from robust.  Whether we are fully out of recession and into clear water is debatable and it wouldn’t take too many negative  economic reports to destabilize the housing market.

Parts of Sussex and Kent have shown a modest increase in liquidity, with a slight upswing in volume of housing stock coming to the market.  At the higher end of the spectrum the availability of desirable and individual houses still remain sluggish and those that do come up for sale attract a significant amount of interest if correctly priced.  The current market remains patchy, blighted properties or those that are over priced take time to sell. It remains true that a quality home correctly priced will sell quickly at full asking price and sometimes above.

26th October 2009

 

As we enter the third quarter for 2009 there are encouraging signs that the property market is improving,albeit  quite slowly and that we may be entering a period of relative stability.

Any market is always driven by supply and demand and the housing market is no exception.

Starting in July and continuing through into October an increase in the number of enquiries coupled with a shortage of properties coming to market has led to a positive swing in the prices we see being realised.

Interest rates remain at an historically low level and look set to continue do so for the immeadiate future,making it easier for homeowners to service the debt on their properties.Consequently less distressed sellers have been seen in the market and thus less available properties. At the higher end of the market we have seen up to 4-5 potential buyers lined up for good quality properties in desirable locations.Realisticaly marketed  these properties have been achieving very solid prices.

It is important to recognize however that we are not yet out of the recession,indeed recent figures have shown that economic output is down for the sixth quarter in a row.The implications of this are that unemployment looks likely to continue to rise,the knock on effect to the housing market being a potential increase in the number of repossesions.This would impact on the balance of supply and demand,more properties being made available and a consequent dampening of the recovery.

The most indepth analysis of the property market will always,by definition,be based on generalities and trends.There is no subsltitute for  local up to the minute knowledge of what properties are coming to market how they should be priced and  what the  financial situation of the vendors may be ,to underpin a successful negotiation and purchase.

As with all economic forecasts there are often contradicatory messages to be gleaned and there is no guaranteed predication as to which way a market will travel.Until unemployment has stabilised and we look to be well clear of the recession cautious optimism remains the wtachword of the day with a broad consensus of a more stabilized and robust property market.

September 2009

The Sussex property market is very diverse offering up superb sea front properties, to the grand county estate. House prices have come down about 30% since the peak of 2007 in this area and the market is still difficult to call, but there is a noticeable change in the attitude of both sellers and buyers. Indeed the property market is still quiet in comparison to 20 months ago but there are noticeable signs of increased activity reported by most agents, reflecting the fact that a realistic selling price and a realistic offer is producing sales.

There will always be people sitting on the fence with a reason to do nothing, either they are waiting for the market to recovery or for property prices to fall further. Not since 1995 have the conditions been better for investment into the property market if funds are available.

Of course, at Stacks we always encourage due diligence when purchasing a property and know that our clients really value the time we spend analysing and evaluating each property pending a wise and informed purchase. The art of a true investor is to recognise a good time to buy and when it is a good time to sell. The deals that can be found in this current market are unlikely to be repeated. There seems that there is only a short window of opportunity before we return to a slightly more relaxed lending environment where the pent up demand to buy and sell property will push prices back up.