“The year to June has seen an unexpectedly buoyant market with a healthy supply of high worth clients looking for houses throughout the country. Despite recent reports of a dramatic slow down in house prices thanks in part to Governor of the Bank of England’s words of caution the market has generally been extremely active. However we have always envisaged that prices in the UK will naturally flatten as people can only borrow up to their new capacity once.”
“If there is one common thread that my co-directors across the regions comment on it is the lack of good property coming onto the market. It is our job to find such property for our clients well before it appears in estate agent’s windows and that has been a challenge in the first half of 2004.
“It’s worth noting that according to statistics, house prices are still going up by more than 19% a year and with employment and wages accelerating the market is set for a calm voyage. The only squall on the horizon is if interest rates continue to rise. This has already taken some heat out and chipped away at confidence and caused a few more prospective house sellers to sit on the fence.
“As several colleagues report generally there are far fewer sealed bids taking place throughout the country which is indicative of some of the heat being taken out of the market, however when certain unusual properties warrant it there I usually a great deal of interest. In one case with 12 people bidding for a house in Rutland with an asking price of £750,000, it finally went for over £1m. My co-director in Buckinghamshire secured a village house for a client for just under the million pound mark but he had to pay £10,000 above the asking price to get it.
“Generally – quality houses are finding buyers. Scotland, Cumbria, the York, Harrogate Leeds triangle, Rutland and Leicestershire are particularly vibrant.
The second half of the year might be quieter as people beginning to drift to the Mediterranean on their holidays but we cannot see any dramatic decline or loss of confidence.”
Looking ahead – sustainable growth
“Looking to the future we see a natural ‘settling down’ period which if history repeats itself will be followed by sustained growth at a more realistic rate and this trend will precisely replicate what happened in the Irish market after it joined the Euro. When interest rates fell from 12% to 4% overnight and this had a knock on effect with a feverish market followed by sustainable growth.”
A selection of comments from the regional directors of County Homesearch Company:
Scotland: Archie Leslie-Melville: “The central belt, the Highlands and West Coast are the hot-spots. The market is likely to remain strong this year but will probably slow in 2005. At worst the market will stagnate but historically Scotland has not had a crash in values before.”
Cumbria: Nick Elliott: “Currently we have four clients looking for houses in Cumbria on the borders of Lancashire one with £3m to spend. It is clear demand has exceeded supply making it hard to find suitable properties.”
Cheshire: Romie Walton: Buy to let investors are looking away from the big cities to smaller towns. There remains a shortage of country properties and some buyers are deciding not to move.”
Warwickshire: Stephen Organ: “Despite recent negative press reports, the South Warwickshire, Oxfordshire and rural bit of Berkshire has remained very strong with a healthy demand for properties in all price bands. Press speculation tends to affect only the middle and lower end of the market. Quality homes conveniently located for commuting to London and the rest of the UK will always attract top-end purchasers.”
East Midlands: Martin Boughton: “Supply is extremely limited. We recently bid over £1m on a farmhouse in Rutland, which needed modernisation and had a guide price of £750,000. We were outbid and 12 people entered a sealed bid. Prices here are now so high some buyers are deciding not to move to this area as it’s cheaper in the Cotswolds!”
Cotswolds: Nic Mills “The quality four bed, old Cotswold stone house with views remains the dream for many buyers. Vendors are now asking more realistic prices and agents are adjusting accordingly, thereby producing a strong flowing market. See it, buy it or loose it!’’
Hertfordshire, Bedfordshire, Cambridgeshire: Douglas Fensome “Many vendors are now bringing houses to the market to catch the end of the bull run but buyers are becoming more cautious against the background of further potential interest rate rises. One client with a £600,000 budget said they had looked at 26 houses since April and still none of them have sold. I suspect that many buyers will not pay asking prices for the rest of this year and will wait to see what happens in 2005.”
Buckinghamshire, Berkshire and South Oxfordshire: David Le Neve Foster: “We have just purchased a village house in South Bucks for a shade under £1m and had to pay £10,000 above the guide price before two other buyers were outbid. I can’t see prices falling measurably this year as the shortage of goof village and country houses is causing prices to hold up well sometimes leading to competition between buyers. I believe it will probably be the autumn before the market weakens and buyers begin to have more say in the price being paid.”
