It is interesting how journalism has changed over recent years and how so many stories now emerge with relatively small amounts of factual evidence to support the direction of the report.
I remember feeling terribly disappointed a few years ago, when a lettings article on the housing market in Tyneside was reported in a national paper, quoting the evidence where they sought the opinion of two people from Sunderland and South Tyneside and one person from North Northumberland. When I followed up with the journalist who was making the report, she apologised indicating she was running against her deadline and had to file something. When I read the report, it was wholly inaccurate on what represented the Tyneside lettings market at that time, and this was one of the first realisations that I had that all that you read is not always factually correct.
Since the mini budget announcement and its subsequent U-turn, the economy has considerable disruption in recent weeks. I have read in many places, and heard on the television, reports of the housing market ‘crash’ the pipeline of sales ‘falling apart’, and more recently a 40% drop in sales reported by estate agents throughout the country. Speaking to colleagues of mine in London, Leeds, and Sheffield, as well as Liverpool and Manchester, none of these statements appear to be accurate.
Most of us would report that the numbers of buyers registered and actively looking to purchase have dropped recently, and certainly in my case in the North East of England popular houses that used to have 20 viewings now only appear to have 10. The same houses that perhaps had 12 offers, now only have 6, but the facts are that they are still much more popular and in demand than they are in supply, and therefore prices are holding and if recent examples of fact are to be believed as a trend, then values are still rising!
In the last 2 weeks, my company has seen 14 best and final offers submitted on normal, regular, and ‘average’ house sales, where selling prices have significantly increased beyond the asking price. These are certainly common in the £300,000 – £500,000 price range and even up towards £1 Million, with a recent example in Darras Hall recording multiple offers within 48 hours of it being launched.
It regrettably doesn’t apply to all house sales and is very dependent upon location, quality, and condition of the house, popularity of its address, and of course the presentation and its interior fit out.
One thing is for sure, the buyers are not falling away so significantly to such an extent that values are beginning to fall.
We can reflect, especially at the higher price range, where some properties have pushed for a more ambitious price that these are not always being attained. We then need to bring that price back to its last known, sensible, selling figure which we regard as managing the aspirations of our client since the value never reached the ambitious goal of its last price push.
I think it is important that when people are considering a move, or when they are looking to rent a home, they seek the advice of a local property professional who can give them factual evidence in the area that they are hoping to move within.
In the meantime, for many homeowners we are still seeing considerably more buyers for their property than we are sellers. So few of the journalists are reflecting on why these conditions are so different this time and very few have reported factually on scarcity of the supply and the reasons why houses are rising in value so much. After the extraordinary individual circumstances of the banking crisis in 2007, we saw an unprecedented reduction in the construction of new homes and this lack of construction over a period of 7-8 years cannot immediately be rectified. Many planning consultants tell us that in the North of England we need several 1000s of houses to be built over the next few years and that it could take 5-6 years to catch up on the supply matching demand. This is of course taking place at a time when materials, labour, and skills, are very short in demand and much increased in price, which adds further complexity to the shortness of supply and the simple equation that more people want to buy than sell.
If you are looking for facts and figures on the housing market, please don’t hesitate to contact the professionals and we will guide you as best as we can. I am available on my email duncan.young@sandersonyoung.co.uk.
Duncan G Young
Chairman