Written by Tim Hayward.
This, coupled with the appalling weather and the uncertainty of the economy has made for a difficult selling season during the summer. This might seem surprising as the number of potential buyers for every available property remains relatively high, although only half of what it was, but still running at 10 to 1.
Stocks of properties are high, and hence buyers are spoilt for choice to an extent that arises perhaps once in a generation.
For sellers though, these are just two of several factors conspiring to slow down the sales process.
From 2003 to the end of 2007 the annual rate of which new potential buyers registered with us compared to the number of properties coming onto our books varied between 17 and 19 to 1. So far this year it is running at 9.8 i.e. demand might be down, but we are still registering nearly 10 additional would-be buyers to every additional property. So why are sales not happening faster? The principal reasons are.:
The banks: ultra caution reigns – for example HSBC now insists that borrowers use HSBC panels solicitors, inevitably insulated from buyers request to expedite matters. This is typical of the more wide-spread practice of enforcing rules as never before, creating endless compliance delays. As a result we have to qualify buyers to a level that can seem intrusive but which is vital in assessing any serious offer especially where high percentage loans are involved.
Stamp duty thresholds: a high proportion of buyers have plenty of equity but not income, so stamp duty hurts. This penalises properties just above each threshold, especially the £5,000 jump at £500,000.
Hesitation: Offers are just as often made in the first week of marketing as in the third month. Either way, owners frequently wait to accept good offers, only to lose a buyer and repent at leisure. To help owners decide, we secure as much information on the buyers circumstances and finances as possible.
Choice itself: it is harder to choose from a larger selection, especially if your hopes for what your money might buy are creeping upwards. By spending a lot of time getting to understand what buyers generally need, we help them to recognise the right house when they see it and to make a committed offer. Buyers continue to baulk at prices, Stamp Duty and finance charges, but continued low interest rates compensate for much of these. Meanwhile, the restraint of most of the last decade, lack of stock, has been lifted. Time to get out there and snap up the property of a lifetime.
Tim Hayward is on 01603 612333.