“I believe that London home owners have an inherent desire that they have to sell for a higher price than they bought for" George Franks, Sales Director takes a look at what is happening in the Sales Market
Tuesday, February 15, 2011 by Douglas And Gordon
Every time you pick up a newspaper and read a report on the property market, it reminds me of a game of tennis. The property reporters can’t decide whether the property market is rising or falling but in true journalistic style, the baseline returns talk of huge peaks and troughs. This discussion will go on for many years to come which in my opinion proves the irrelevance of it all. Let’s make one thing absolutely clear, there is no such thing as a “property” market. Even in the areas of Central and South West London that we cover, every office experiences differences in its market. Chelsea, for example, will have a very different outlook in terms of international buyers than let’s say West Putney, which is indeed very much a family market.
So, once you discover this fact, you realise that every area of London, indeed the country, needs to be looked at separately. The underlying economic factors we have as a country are unlikely to change soon; we still have a £1 trillion debt which we have to spend £120 million a day just to pay the interest. (No repayment option here). Also, the banks, although being a little more generous, are hardly falling over themselves to lend. Even against this rather depressing backdrop, house prices in London have not fallen - the opposite is true. Therefore, I don’t believe the London property market is going to experience an “Andy Murray” moment in the very near future and collapse. Why? Shortage of property to sell. Our vendors are, on the whole, very relaxed about whether they sell or not; this is probably down to a number of factors, including low interest rates and the lack of somewhere to move to. I also believe that London home owners have an inherent desire that they have to sell for a higher price than they bought for.
As at the end of January, our applicant levels have literally tripled since December, which admittedly was a low bar. We had more applicants in January than any month last year, even without the property bait. We appraised less property than this time last year and have been instructed to sell slightly less property than in January 2010. Should these figures continue throughout the spring, then I’m afraid I can see no option other than prices starting to rise.
I think if I was going to give any advice to a purchaser, it would be to put the general property comments to one side, soak up as much information you can on the particular area you’re looking in and if you see the right property and it is a price you can afford, don’t be afraid to commit to buying - although against popular belief, you might well end up paying more in a few months time.