The property market has changed almost beyond recognition in the last 12 months; this is your key guide to making the most of the current market.
In order to make the most of this new reality, you first have to understand it. So what’s going on?
Young people are waiting much longer before they are able to buy their own properties. The percentage of 24-35-year-olds who own their own home is at a record low. Part of the reason for this is the gulf between wages and house prices which is at an all-time high; but it is also due to the fact we are living longer and many of those of the older generations are not moving from the homes they already own.
Of course, the elephant in the room is Brexit. There is little we can do to escape the fact there is a lot of uncertainty regarding our economic future. This uncertainty has been further compounded by the narrowing of the probability gap between a ‘transitional arrangement’ and ‘WTO rules’, according to the think tank Oxford Economics. However, it may be that the fear is worse than the reality.
A recent RICS survey found that there was a further drop in surveyor’s confidence regarding the stability of house prices. This also comes at a time when London’s property prices fell for the first time in recent history. Yet, fewer surveyors reported a fall in the number of surveys they had been asked to do. This provides reassurance that there hasn’t been a collapse in the number of properties sold.
The first question to answer is ‘what would a crash look like?’
A major decline in the housing market would be predicated by a significant, and potentially sudden, fall in house prices. This would then be combined with a similar fall in demand; which has not happened.
So what is the reality?
Summer was quiet, as it often is, and it did take longer to pick up at the end of the school holidays. However, from our experience, it seems there is now a desire to make up for lost time!
In our area, there is still significant demand towards the middle and upper end of the price bracket, and we are finding that buyers from London and overseas are still very much forthcoming.
As far as the rental market is concerned, demand is incredibly high, it is truly a renter’s market at the moment.
So what if you want to sell your home? Is it a buyer’s or a seller’s market?
The answer is probably both.
Demand is incredibly high for well-priced properties. Whilst the right price has always very important, the demand has been so high that a property might sell even if it were slightly over-priced. This is no longer the case as the majority of buyers and sellers are very highly motivated.
However, that is not to say that prices are falling. After all, those optimistically-priced properties did sell, though not for their advertised priced, or if they did, it often took a while.
This means that you need to price your house realistically, and make sure that it is marketed in a way that will attract the right buyer for your property. In fact, we are finding that it is marketing that is proving the difference. As buyers are less willing to compromise and there are fewer speculative buyers looking, there is a greater need to convince them they are making the right choice. Concurrently, blanket marketing no longer works, as the message becomes easily lost.
Today’s buyers are far more savvy, they are invariably motivated and know that the market is balanced. This means your marketing must be tailored for them; you must court your buyer, as they must court you.
This has become our standard advice: it is not necessarily a question of lowering your prices, rather of attracting the right buyer.