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Residential Management Team
In short, the property market in North Yorkshire and South Durham has been the best we could have expected to have seen since the heady days of 2008, with a strong market in 2014, which continued into the first part of 2015.
In the pre-election run up, nationally we experienced a noticeable slowing of activity in both people wanting to put their houses on the market and viewings on current stock, with some buyers waiting to see the outcome of the election before committing to a purchase.
Fewer sellers have shown their appetite to come to the market in the first quarter of 2015 and in the year to date compared with the same period last year; there has been a 25% reduction in new people actively looking to buy. That said, the first three months of last year were incredibly busy for than would have traditionally been expected during that period and very much against expectations following on from previous years
What is interesting though is the decisive nature of the market we are experiencing in our core area. Despite the fall in the number of properties we have been asked to value and bring to the market, we have actually seen an increase in the number of instructions to sell. Whilst this contrasts with the Royal Institution of Chartered Surveyors (RICS) April Residential Market Survey, we have experienced a marked fall in the volume of offers received, which can only mirror the drop off in would-be new buyers.
The RICS have suggested that there has been a ‘shift in tone’ in the London market where 28% of respondents to the monthly survey saw actual price rises compared to the previous month. Does this therefore suggest that the market will see prices rise again this year?
The Telegraph reported that “the unexpected outcome of a majority Tory government has released the brakes on buyer confidence and activity and is likely to nudge property prices higher in the coming months”.
Whilst we have yet to see evidence of property prices increasing at a local level, we can report increased activity levels across our market town branches post-election and, providing the stable and steady growth continues, price rises may well be a possibility in time.
What has been reported previously is a deeper underlying problem of affordability. The downward trend in owner occupation, particularly in younger generations is a huge concern and whilst the decisive election result could result in a pick-up in instructions to relieve the strain on price rises, the government find themselves challenged to deliver 1 million new homes by 2020. Affordability across the market is absolutely key; the government need refined policies in addressing the mapping of brownfield sites, addressing planning constraints and restrictions and to actually assess the economic and social drivers that will help provide solutions. The pressure on the rental sector is huge and higher rents do no more than squeeze the pockets of those who have aspirations to buy but can’t save for deposits. That, in my opinion is not acceptable and a generation of would –be house owners will lose out if the new homes policy isn’t addressed head-on.
Chris Arundel, Head of Agency GSC Grays