Property Market Comment

Since my last comment back in the summer of 2023, there has been a marked improvement in market confidence. November and December ended up being quite busy for me personally, and buyer numbers were up generally across the region and nation respectively. 

As we start 2024 I expect this uptick in confidence to continue building momentum. 

We are seeing mortgage rates come down on the high street and several institutions are predicting (Nationally) house price rises of anything between 1 and 5% this year.  

Whilst the National or London picture is linked to the South Devon market,  it is still a micro market down here with its intricacies and nuances. However, I feel prices will remain robust and would not be surprised if we do reach the heady 5% price gains by the end of the year for those most in demand ” best in class” properties in the £900k to £1,500,000 range which seems to be most out of kilter between supply and demand. 

Prices may continue to soften a touch on the more compromised properties and properties that require a lot of work.

Only time will tell but the overall picture seems to be one of more stability, more buyer demand, and probably a continued lack of quality housing stock.

There is no denying that this cost of living and interest rate hikes are taking their toll on both the local and national market. 

There was a little more resilience down here for a short while as a number of buyers who entered the market over the last 12 months or more, were still working through the system and often sitting in rented waiting to pounce. Causing a lag behind the national picture.  

However, most of these buyers have now found and the new wave of people looking to relocate are ,more often than not, not yet under offer up country. Or when they become under offer, they have had to accept less and so have less in their pocket to spend. 

There are always exceptions. Good properties and the perfect buyer that comes along. But the broad picture is one of softening prices and a flight to class. Compromised properties are being hammered given the smaller pool of proceedable buyers (Buyers that are under offer or in cash position) 

I am putting together a bid right now for a client on a house with 5 acers at circa £700k on the southern edge of Dartmoor. We may have a bit of competition, but I don’t expect this to get much of a % increase over asking price. It’s rare, as it is hard to get this kind of land for the money.  A large % of the mainstream population are wanting to buy a bit of the ”good life” But out of the 25 people to have seen this house , a lot are not yet under offer (the agent shared this with me)

I am actively looking for 2 or 3 other clients right now, but we are not willing to compromise much and are waiting to pounce on the 1 out of 20 that gets ahead of the curve.  the one house that is so ”clearly” better than the 19 we have seen ,that if it were on in a sellers’ market, could be on for the price bracket above what we are looking in.  

Very interesting times and plenty of opportunities. 

It’s always hard to call the bottom of the market but I suspect it’s going to be soft for the rest of the year.  It will also be interesting to see how many forced sellers come to market over the next 6 months as this is the time the largest proportion of fix rate deals are having to be renegotiated. 

In terms of % you can expect to negotiate on things down here – It is case by case. But with the clients I have, we are most definitely trying to find that 1 house that has either reduced sufficiently or that will take a low offer causing it to clearly stand out amongst the crowd. 

As I write this, it feels like the Spring market is definitely underway. A little more stock is available and a good level of transactions are being agreed across all price ranges. There is definitely a ‘flight to quality’ with the ‘best in class’ outperforming the rest of the field. The softest price band is probably anything under £800k and the strongest is from circa £800k to £1.5m where the demand/supply imbalance is at its most acute. Interestingly it seems a number of houses between the £2m and £3.5m price range are being offered to me, off the market, properties not yet available on the open market. As sellers and agents try and figure out what a reasonable marketing price should be. With the view of then launching them to the open market if they haven’t found a buyer via the off-market route, and once they have had a handful of prospective buyers through the door.

Summer Market 2023

There is no denying that this cost of living and interest rate hikes are taking their toll on both the local and national market. 

There was a little more resilience down here for a short while as a number of buyers who entered the market over the last 12 months or more, were still working through the system and often sitting in rented waiting to pounce. Causing a lag behind the national picture.  

However, most of these buyers have now found and the new wave of people looking to relocate are ,more often than not, not yet under offer up country. Or when they become under offer, they have had to accept less and so have less in their pocket to spend. 

There are always exceptions. Good properties and the perfect buyer that comes along. But the broad picture is one of softening prices and a flight to class. Compromised properties are being hammered given the smaller pool of proceedable buyers (Buyers that are under offer or in cash position) 

I am putting together a bid right now for a client on a house with 5 acers at circa £700k on the southern edge of Dartmoor. We may have a bit of competition, but I don’t expect this to get much of a % increase over asking price. It’s rare, as it is hard to get this kind of land for the money.  A large % of the mainstream population are wanting to buy a bit of the ”good life” But out of the 25 people to have seen this house , a lot are not yet under offer (the agent shared this with me)

I am actively looking for 2 or 3 other clients right now, but we are not willing to compromise much and are waiting to pounce on the 1 out of 20 that gets ahead of the curve.  the one house that is so ”clearly” better than the 19 we have seen ,that if it were on in a sellers’ market, could be on for the price bracket above what we are looking in.  

Very interesting times and plenty of opportunities. 

It’s always hard to call the bottom of the market but I suspect it’s going to be soft for the rest of the year.  It will also be interesting to see how many forced sellers come to market over the next 6 months as this is the time the largest proportion of fix rate deals are having to be renegotiated. 

In terms of % you can expect to negotiate on things down here – It is case by case. But with the clients I have, we are most definitely trying to find that 1 house that has either reduced sufficiently or that will take a low offer causing it to clearly stand out amongst the crowd. 

The market remains active although, despite a slight uptick in stock levels as you would expect in the Spring Market, the acute imbalance between demand and supply remains. This has in affect slowed the market down as chains stutter to a standstill whilst buyers wait for their vendors to find and so on and on it goes until the chain is finally closed. The lack of stock seems to be a self-perpetuating problem as would be sellers remain reluctant to bring their properties to market without the confidence in being able to find themselves.

We are also seeing a two tiered market, with the exceptional properties priced correctly, still attracting multiple offers and often still exceeding the guild price. Yet properties that are over priced and perhaps slightly compromised, are sticking and in some cases having to adjust their marketing prices down. Borrowing costs are rising and this will impact affordability and price growth. But buyers that want to move to Devon are motivated and not too concerned with any slight downward adjustment should there be one. They are buying for lifestyle reasons and for the long term.

We are still incredibly busy with new clients and interestingly I am getting more and more calls from would be sellers direct, who see the value in reaching out in the hope of finding a buyer without having hoards of people through their doors. In these cases, I often insist they get support from an estate agent but am always happy to try and place a buyer avoiding the need for them to go to open market.

An all-time record high of one in three properties sold for more than the original asking price last month.This is according to the latest market snapshot from NAEA Propertymark, released this morning.The exact proportion – 32 per cent – is twice that proportion recorded a month earlier and is the highest figure on record for the organisation, beating the previous all-time high of 19 per cent back in May 2014.

The Propertymark stats also suggest that the average number of house hunters registered per estate agency branch was 427 in April, an increase from 409 in March – and the highest figure for the month of April since 2004.The number of properties available per member branch stood at just 27 in April, falling from 31 in March.

This figure is the lowest recorded since December 2002 when 25 properties were available per branch.“This means there is an average of 16 buyers for every available property on the market” according to Propertymark.The average number of sales agreed per estate agent branch last month stood at 12, identical to the March figure. Meanwhile the number of sales made to first time buyers stood at 27 per cent in April, which remains the same as March.

“It is phenomenal to see demand for housing breaking records, as house buyers continue to fuel the post-Covid economy. However, the continued imbalance of supply and demand is a concern and has led to a strong sellers’ market with properties being snapped up quickly at high prices” explains Mark Hayward, Propertymark’s chief policy advisor.

He continues: “We look forward to the much-needed rebalancing of the market, and we hope the Planning Bill outlined in the Queen’s Speech encourages the development of more housing, particularly in more affordable areas, as most of the development taking place is in areas that are unaffordable to first-time and lower income buyers, although the government’s First Homes initiative will be a much-needed boost.”

https://www.theguardian.com/business/2021/mar/19/cornwall-overtakes-london-as-most-searched-location-for-uk-movers

We are in unprecedented times. Cornwall has now taken over London as the most searched for location on Rightmove. Cornwall has a population of circa 600,000 where as London has circa 9,300,000.

The coastal Regions of Devon have come third in the list.

I have been in the business of buying and selling property for over 20 years and cannot remember a more extraordinary market place as the one we find today. Yet, I just don’t see, demand dampening for the foreseeable future.

I actually feel there is enough demand already in the market place, to keep sellers and Estate Agents with plentiful supplies of buyers, for the next 5 years. Estate Agents have people queuing for property and this waiting list will not clear for many years to come.

We are facing a revelation in terms of where people now want to live and that now can live.

I do hope the market cools down post June 2021, once the stamp duty starts reverting back to normal. But I don’t think there will be a dramatic shift in demand.

As your Search Agent, It is vital to make you as a competitive buyer as possible and to try and see properties before they go “live” on the Portals. I now also have 2 or 3 clients willing to buy without seeing the property in the flesh. This may seem reckless, but in some individual cases, it is the most logical way to secure a property in today’s market. However, it is vitally important you have someone on your side to share with you the negative aspects of any house in a balanced and honest fashion, before you can possible consider taking such bold steps.

Very best,

Ed

The start of 2020 was certainly an improvement upon the sluggish Brexit dominated 2019 market, but with the new challenge of life with the Corona Virus, the property market has largely been stagnant as we have all tried our best to navigate through this strange and uncertain time.

That said, this has been a time for reflection for many and with the ‘new normal’ seeming to indicate that working from home is the way forward, I ask the question – will there be an influx of relocations to the South West?

This question has indeed been reaffirmed by recent articles in the Times property section as well as when speaking to local estate agents. In speaking to one Dartmouth agent last week, he stated ‘’ we have been inundated with enquiries and are on back to back viewings and market appraisals. Yes, some of the enquiries are less credible than others and there is a feeling that people are seeking to find a property that they enjoy living in, as opposed to a property that is near work, shops etc.’’

Having recently relocated to Devon from London with my husband and baby, I can certainly see the appeal of a move to the South West, provided it is feasible to work from home. According to the office for national statistics, only 5% of the UK workforce worked from home in 2019. That number has obviously spiked in recent weeks, and with it, the number of Londoners searching for Rural properties (Rightmove)

Over the past 3 months, families may have taken this break in normality as a much needed time to sit back and reassess what they deem to be important. A time to reprioritise. Instead of viewing a property as a place to simply crash out in the evenings and weekends, buyers will be posed with the question ‘’can I live and work here, with my family, during a lockdown’’ – a new set of requirements will be created and perhaps with it, an increased demand for rural properties, space and a more astute buyer.

Perhaps the lockdown has given you an opportunity to tackle the growing list of DIY jobs and you feel that now your property is looking its best, it’s time to sell and downsize. Perhaps you have decided that you need more of a work life balance and are desperate for some clean air and greenspaces.

Whatever position you find yourself in, in this new world, instructing a buying agent will ensure that you are best placed to start your property search. Stacks can help you understand the local market and preview available properties on your behalf meaning you save unnecessary travelling and legwork, leaving you to focus on the things you enjoy. Due to our relationship with local agents, we are often informed of properties that haven’t yet reached the open market- giving you as a buyer a cutting edge and putting you head and shoulders above the competition.

I will personally assess the property for you, as well as perform a detailed video tour to show you the property in depth, leaving no stone unturned or cupboard closed!

Please do feel free to call to discuss how I may be able to help you find your dream Devon property.