Monthly Archives: October 2018

November Market Comment

NovemberFrom a property perspective, it would appear that the latest budget will not be enough to light November’s fireworks. Nevertheless, overall, it did hint at a surprisingly stable economy, with improved growth prospects and an apparent end to the tighter austerity regime.

The one thing the property market needs is to find its own equilibrium with minimal government involvement. We know that a healthy property sector, based on reasonable sales volumes, is good for the economy in terms of jobs, home improvement businesses, SDLT (stamp duty) and VAT revenues. However, past “incentives”, mostly for political gain, but apparently designed to stimulate the market, have often artificially inflated house prices.

As estate agents, we are of course passionate about securing high prices for our clients. It’s what we do, responsibly, of course. But Mr Hammond’s budget, for the first time, recognised that the only way many people can buy their own first home is to do so via shared-ownership. So he abolished SDLT on shared ownership homes up to £500,000, although this is only expected to cost the government £5 million – not much in the grand scheme of things. Remember, shared ownership does not mean buying a property with another person; it means buying only part of a property and effectively “renting” the other part, usually from a housing association.

We believe that SDLT should ideally be completely overhauled, as the cost of moving for most people is at an all-time high – and this has little to do with estate agency fees, which are actually the lowest in the world!
Nevertheless, property prices have not fallen by the 10%-18% as the Treasury predicted in May 2016, as a warning in the event of a pro-Brexit referendum result. In fact, they have continued to rise, by around 9% since then, with transaction levels 13% above the same time last year (source HMRC). Wage growth is actually increasing strongly and lending remains historically low, with unemployment at its lowest level since the mid-1970s.

Whatever happens with Brexit, it seems that people are once again prioritising a house move in response to lifestyle changes such as marriage, family, schools, jobs, divorce, downsizing, etc. They seem to be increasingly immune to the uncertainty surrounding Brexit and are getting on with their lives – a wonderfully British ideal that has stood the test of time.

Whatever your plans, please regard us as your local experts in property, and call us for advice on 01933 224400 before you make a move.

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The Value Of Sold….

Sold boardOur last article considered some of the dangers associated with pricing your home in relation to other properties available for sale (ie those remaining unsold). This time we’ll consider pricing in relation to properties which have actually sold.

When considering what asking price to quote, common sense dictates that the price of other homes which have sold locally could be a good indicator of the price you should be quoting. However, your research could well prompt you to price your property at a level which could under- or over-estimate your optimum sale price.

Irrespective of national trends, the property market is very sensitive to imbalances in supply and demand even on a street by street basis. When there are many qualified buyers all seeking a rarely-available house in a popular street the price goes up. If fate dictates that the following week five such houses become available in the same street, the price will inevitably fall.

Likewise there can be situations where a property is sold at a record price to an individual who particularly wanted a specific property for personal reasons. Conversely a situation could arise where a desperate seller, who might otherwise suffer repossession, agrees a sale at a very low figure for a quick sale.

Only the estate agent involved in any of these transactions knows how the individual circumstances of sale can affect value. So a word of caution – leave the science of valuation to an experienced local estate agent who is highly active in the market and has a good track record of achieving swift sales at or close to his/her suggested asking price. Time for a chat? We’re here to help.

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The Value Of For Sale…

For Sale BoardWhen considering the value of a property prior to putting it on the market, many vendors understandably look at the asking price of other properties currently on the market locally, and draw pricing conclusions based on this research.

Whilst this is not an unreasonable way of determining value, there are some traps for which to look out.

Firstly, an important observation is that if a property is on the market, it is by definition “unsold”. An unsold property is invariably one that is overpriced. If it had been priced correctly then it would have sold, but in the event the market has rejected it and it will probably only sell if the price is reduced. So if you have a similar property and you price it at about the same level as the unsold property, then the chances are that yours will remain unsold as well.

We know that purchasers buy by comparison. So your property has to compare favourably when seen alongside others on the market. If your property is similar to another on the market nearby, then yours only becomes readily saleable when it is priced favourably and offers better value for money.

Additionally, if you feel that your property is slightly better than a neighbouring property for sale (as you are bound to, as you chose the décor and it has your own possessions in it) then surely it makes sense to quote a similar price, rather than attempting to offset the extra features with a higher price.

Ultimately, correct pricing is all about seeing the world through the eyes of the buyer and making responsible and effective pricing decisions which always point to offering better value than that offered by competing properties available locally.

We’re experts in this field. If you’d like to know how your own property compares to others currently available then please feel free to contact us on 01933 224400 for a free and intelligent consultation without obligation.

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Should I Make An Offer?

Should IAs a buyer you are in a powerful position, both in terms of the effect your buying decision will have on your own life, and on that of the person from whom you buy.

If a property were some form of commodity like petrol or milk, then you would simply buy the cheapest stock available. However, buying a home is much less mercenary, and emotions run high.

Over the years, homebuyers have become used to the idea of making a “starting offer” below the asking price, but it might be worth considering a few aspects of the implications of making a low offer.

Firstly what does a low offer say about you to the vendor? That you don’t have the money and that any subsequent increase might stretch you beyond your ability to complete the purchase? Does it suggest you don’t really like their home, risking offence? A low offer can often start off the relationship with the vendor on the wrong foot.

And what if your low offer is accepted? Will the vendors experience regret and continue to market the property hoping to find a higher price with someone else? The chances of such a buyer being found are high as people usually want a property that someone else wants. We receive more interest about properties which are “under offer” than we do about those for sale!

Ultimately it’s about commitment. An offer at, close to, a realistic asking price tells the vendor you are committed to the property. In return the vendor is likely to demonstrate a level of commitment to you that will result in a successful purchase.

Ultimately, you are buying a home; is it worth losing your dream property for the sake of getting (and possibly losing) some sort of “deal”. Most properties sell for about the “right” price – all you have to be is the “right” buyer!

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