It is something that no one expected to hear again for quite some time, but many prime agents are saying now is a great time to put your property on the market.
There has been much made recently of the 'green shoots' starting to appear in the housing market, though the jury is out on whether this is misplaced optimism or a sign of a genuine recovery.
Without a crystal ball, it's a difficult debate to end. However, there is one thing that cannot be disputed. After months of falling prices and buyers dictating tough terms, the market has firmed up and the balance is tipping back in favour of sellers.
Just about every index and survey is showing significant improvement. Here are a few key statistics from a range of sources:
- Asking Prices: Asking prices have risen for nine successive months, according to Primelocation.com's Prime Index. July 2009 was the largest increase recorded in this time (1.3 per cent).
- Sold Prices: Sold prices rose in June for the first time in over a year, says the Land Registry, and were up by an impressive two per cent in London.
- Lending: Mortgage approvals have risen for five months in a row and reached 47,584 in June, the highest number since April 2008 (Bank of England).
- Demand: In July, new buyer enquires increased for the ninth consecutive month, says the Royal Institution of Chartered Surveyors. Primelocation.com's figures for the same month show enquiries up 13.7 per cent over the month and up 9.8 per cent year-on-year.
Lack of supply creating sellers' market
With the gap between asking and selling prices closing rapidly, properties are attracting multiple bids, and there are even reports that gazumping and sealed bids are back (especially in the prime market).
Sellers, say agents, are back in control, and for one very simple reason: a large mismatch between supply and demand. Andrew Smith, head of research at Primelocation.com, explains:
"Fewer properties on the market has come at a time when agents are reporting a rise in the number of buyer enquiries and sales.
"In June, Hamptons International noted that their London offices had seen 'double the number and the value of sales so far this year compared to last. Many buyers are complaining about a lack of available stock with the number of properties for sale down 31 per cent year-on-year'."
It's a sentiment being echoed by agents across the board. Peter Rollings, managing director of agency Marsh and Parsons, has found that "a chronic shortage of properties for sale has intensified competition amongst buyers. The result is rising asking prices – and offers to match.
"We've seen a considerable number of properties go to best and final offers in recent weeks. Buyers simply don't have the same power to negotiate as they did at the start of the year – and those who aren't prepared to come closer to sellers' expectations will almost certainly miss out."
Similarly, Liam Bailey, of Knight Frank, says: "The volume of properties available in central London in July was down 34 per cent compared to the same month a year earlier. The number of properties coming forward for the autumn market is showing no improvement – with the pipeline of new properties coming to the market down 42 per cent over the same period."
And it's not just in London. Demand from buyers is also up in country areas, especially the Home Counties. Rupert Sweeting, Knight Frank's head of country department, credits this to people being ready to get on with their lives.
He adds: "Our country department sold 36 per cent more properties last month than in June 2008 and viewings were also up 12 per cent. Now the market needs more stock and credit to satisfy this demand."
Quick sales surprising vendors
All of this, of course, is excellent news for sellers – but the message doesn't quite seem to have got out there yet. A vendor who recently sold his property though Marsh and Parsons' Holland Park office was amazed by the interest in his property and the ease of his sale:
"The property was on the market for just five weeks. People were naturally very cautious to begin with. We had a lot of viewings very quickly, and then everyone sat back and waited to see what was going to happen.
"But as soon as one made a move and started firming up, the other two or three people who were seriously interested all jumped in too. We ended up getting a very fair price."
Given this, it's hardly surprising that agents are advising anyone contemplating putting their house on the market to do so now.
Yolande Barnes, of Savills' research team, explains that those holding off on a sale in the hope that market conditions will quickly return to the highs seen two or three years ago are "waiting for a ship that we think sailed long ago".
Vendors who are holding out will lose out. For although the figures are on the rise right now, this looks to be a small window of opportunity, with many believing that current market conditions are unlikely to last.
It is predicted that more stock will enter the market in the autumn, meaning the discrepancy between supply and demand will go some way to being balanced out, buyers will gain back some control, and prices will reflect that.
...But use a good agent
So prospective vendors should move quickly to take advantage of the sellers' market now and get their property valued.
But a word of caution for those seriously wanting to sell: there are lots of online services out there offering automatic valuations, but these are based on Land Registry data, which is behind the curve, and should be treated with some skepticism. The prices quoted are computer generated estimates and as such can often be wide of the mark.
Agents, on the other hand, have their finger on the pulse and will have detailed knowledge about your local market – so contact three and ask them round to value the place. You have nothing to lose, and you might be pleasantly surprised by what they tell you!
related information
- Prime Index
related links
- Bank of England
- Land Registry
- RICS
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