By Philip Macdonald, managing director of Abbotts, based in Bury St Edmunds:
In its latest report, the Royal Institution of Chartered Surveyors (ROCS) reported significant improvements in demand for property, with the 8th successive monthly increase in new buyer enquiries and this has fed through into increased transactions leading to a sharp rise in sales. As existing stock is now reducing at the fastest rate for a couple of years, the focus is on new instructions: sellers with time on their hands and no pressure to move have been cautious, being concerned about pricing. However, Rocs gives some assurance that prices are stabilising, nevertheless, new rules on Home Information Packs (HIPs) may continue to hold people back. These are an unnecessary extra expense, and have certainly contributed to slowing the housing market; the government should suspend them until we see a full recovery.
It is worth remembering that the moratorium on stamp duty up to £175,000 only lasts for a few more months, so properties in this price range are especially sought after by first time buyers, and sellers are in a good position to secure a sale, enabling them to move up the scale. Hopefully, the government will extend the moratorium for another year in order to sustain first time buyer demand, which has helped to boost activity.
So, is it the right time for those cautious sellers to bite the bullet and enter the market? Given the promising RICs commentary, and our own experience on the ground, the answer must be yes. Although some sellers are finding it difficult to come to terms with lower asking prices for their own properties, they can certainly benefit from similar reductions when they buy. In many cases, we are seeing people being able to ‘leapfrog’ to their ideal home, buying something larger than they could have ever have anticipated at this stage in their lives – because prices are affordable, their mortgage is affordable. The secret to success is the choice of agent. Pick one with experience, and a track record of sales in the bad times, as well as the good. They know how to present a property in the best way, and to achieve the best possible price, based on recent sales of comparable properties. They can also advise on the next purchase and actively seek out the ideal property, co-operating with other agents when required to identify exactly what a seller wants. And they keep control of the whole transaction, both sale and purchase, through to exchange of contracts, and the day you move in. Smoothing the process, and keeping all parties regularly in touch with progress.
Philip Macdonald’s on 01284 704815.