September is renowned as being a month when the property market sees heightened activity with the summer holidays having been endured, the focus set towards Christmas and a reasonable timeframe to move house in between. It appears however that the mixed sentiment on which Garrington reported last month, has permeated into this, leading to conflicting data and frontline doom and gloom. Dissecting this information and taking into consideration the variety of sources used, we do not feel that the outlook is entirely bleak.
Across our operating regions, comments on market activity from selling agents and solicitors (to name but a few groups) vary, not only from county to county but within the counties themselves causing the property market to seem very segmented. Therefore, drawing a reliable conclusion for the whole of the UK is difficult.
According to the latest figures from Land Registry, mainstream house prices have shown an increase, albeit negligible at 0.3% in August, for the third consecutive month yet transaction levels have continued to drop off; Nationwide house price data supports the trend that property prices are currently on the ‘increase’ albeit at +0.1% in September. This is in stark contrast to Rightmove statistics based on asking prices which indicate that the average house price has fallen 3.4% in the past three months. Similarly, Halifax has announced a record monthly fall in September of 3.6%.
Our consultants concur with the evidence purporting to a decrease in prices, seeing all but the most popular locations and best-of-breed houses, subject to price reductions. It stands to reason therefore that accurate asking prices are key to drawing up interest thereby generating competition which, in turn, leads to property prices being maintained, and thus preventing a continued slide.
Every cloud does have its silver lining though. The RICS has reported an increase in stock levels, something we at Garrington are witnessing on the ground and vendors appear to be adjusting property prices accordingly. These factors will create opportunities for our clients who should take full advantage of the uncertainty being felt by sellers and also capitalise on effective borrowing. Without a doubt, the abolition of Home Information Packs (HIPs) brought speculative vendors to the market and now it is simply a case of finding proceedable buyers for the rising levels of unsold stock; mortgage-ready and cash buyers will have the edge when it comes to the negotiation arm wrestle.
Contradicting the RICS, Primelocation information for the month revealed that stock levels in the Prime (top 25% of all UK property by value) and Prime Platinum (top 10%) segments tailed off in September. The previous four months had seen growth in both tiers by at least 6% a month which slowed to 0.6% in September. There is however plenty of quality properties still on the market at the top end and the market stagnation only serves to benefit the committed buyer.
The next six months is likely to be atypical of the housing market as we know it, each month throwing up unseasonal surprises. Whether we are entering the much publicised ‘double-dip’ or purely need to weather an Autumnal blip, remains to be seen but we must not forget, we are in a buyers’ market and our clients should reap the benefits.