What next for the unpredictable property market?
You might think logic would have dictated a fall in house prices across many urban areas as people fled in panic to the countryside in 2020. Simple supply and demand, surely? Greater demand for isolated homes in the countryside, with an accompanying increase in the supply of homes in places like London. But it was not that simple. Many of those moving out of London kept their homes in the capital and were looking for a country retreat rather than abandoning their trusted nest egg completely. Pent up demand outstripped supply defying expectations. Prices in London went up.
The gap between house prices in the countryside and London was at its peak in 2012-2014. In April 2014 we saw the market turn at the very top end, predominantly in London, where the additional cost in stamp duty was a big factor in weaker demand.
That trend has continued for the last six years producing a concertinaed effect down the price scale to homes at the £1m-£2m level. Homes beneath this level have proven more resilient to further drops in price. The trend has not been drastically altered by C-19, merely accelerated. London remains an attractive long-term investment and some buyers are beginning to realise that the super prime locations in London are now much more attractively priced than they were, say, in 2014. It is also widely anticipated that money from the Far East, particularly Hong Kong could kick start the prime London market.
How can these recent trends help buyers in today’s market determine where to pitch an offer? Most buyers fail to ask the most relevant questions when buying property. How long has this seller owned this property is a simple question, but too often overlooked as irrelevant. Many estate agents will respond quizzically, but if a seller bought a property in 2008 or 2001 or even as far back as 1992 (when some properties were purchased at attractively low prices), they are far more likely to be flexible on their asking price than if the response is 2014.
At Hanslips, we act for buyers only and know the right questions to ask. This puts a client in the best possible position to negotiate hard and achieve the lowest possible price.
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