Amidst all the Edinburgh Festival shennanigans, it’s been hard at times, in Edinburgh and the Lothians, to remember that the world continues normally behind the plethora of closed streets, visitors and Oxbridge students pushing flyers in the face of anyone who dares to make eye contact with them. We would normally, in August, expect to see the market slow down a little, with summer holidays and school holidays getting in the way. However, this August hasn’t been anything like that. To find out why this has happened and the effect that this has on you as a potential property buyer or seller, read on…!
Press Coverage of the Property Market and General Economy: Who Flicked the Happy Switch…?!
After years of negativity (much of it well-justified) about either the property market or the general economy (the two of which go hand-in-hand), and much reading of newspapers from behind the sofa or peering through your fingers if you are involved in the property market or own a home, it suddenly became a pleasure to read the newspapers again this past month!
There isn’t enough space to actually cover every bit of good news in this property market update, so I’ll pick just some of the best ones:
Interest rates to stay low for the next three years at least, according to the Bank of England. As far as I am concerned, this was probably the biggest thing to happen in the property market this past, erm, year/few years. Indeed, it was so important in my opinion that it required its own article. So, for the full story and to see just what effect that statement will have on the housing market, click here: http://www.mov8realestate.com/blog/item/159-bank-of-england-announces-base-rate-wont-go-up-for-three-year.html
House prices rose by 0.9% in July, a sixth successive monthly rise which brought the annual rate of growth to its highest level in three years, according to figures from Halifax –
Investors are starting to see property as a more attractive proposition again, with a huge rise in buy-to-let mortgages, at a rate not seen since 2008 – http://www.theguardian.com/money/2013/aug/09/buy-to-let-house-price-boom-mortgages
The economy in the UK has confounded expectations of almost everyone and performed better than expected – http://www.theguardian.com/business/2013/aug/23/uk-gdp-revision-economy-ons-growth
The rate of house price inflation in the UK is continuing to rise, according to official statistics. Prices in the year to June rose by 3.1%, said the Office for National Statistics (ONS), up from 2.9% in May – http://www.bbc.co.uk/news/business-23668507
The Royal Institution of Chartered Surveyors (RICS) said that Help-to-Buy and other initiatives have prompted the property sector to “turn a corner” after its post-recession slump. Its monthly report says prices are up for a fourth consecutive month as buyers return to the market in their biggest numbers for four years. – http://www.theguardian.com/business/2013/aug/13/rics-house-prices-rising-fast-peak
The good news in particular, in Scotland, if you are a home owner or potential seller, is that the Help-to-Buy scheme that has been credited with helping the market actually hasn’t yet been launched in Scotland. Plans were, however, revealed this month for its launch and that can only help the property market in Scotland. I have spoken-out against the Help-to-Buy scheme in the past, but since I have no say in whether or not it is launched (sadly!), the fact that it seems to be helping the property market more broadly than just the new-build sector can only be a good thing. – http://m.scotsman.com/news/uk/scots-help-to-buy-scheme-limit-set-to-be-400k-1-3061940
What have we seen happening in the market this past month? Honestly, we’ve not seen anything like it before.
[Quick caveat – we have just celebrated our 6th anniversary as a company. So, as a company, we’ve not seen anything like this before. The current writer HAS seen something like this before, but it is a distant memory, long-since wiped-out by a property market crash, Lehmann Brothers etc and a global and domestic economic depression and recession.]
August is normally a time to regroup after a busy spring and summer period, a time when everything slows down a bit and we get all that pesky filing up to date. That most certainly is not what we’ve seen this year! And it’s not just us: it’s backed-up by looking at stats in the Press and the professional login areas of ESPC and Rightmove regarding activity in this period.
With two full working days of the month to go, we’ve signed-up 25% more properties to go the market than in any other previous month (106 so far, with a full working day to go, an absolutely insane amount and our first time over 100, let alone even close to it!) and have sold 67 (there are enough in the pipeline to take this well over the 70 mark by the end of the month, which would be a new record for us too).
The overwhelming factor that has been obvious this past month is simply the optimism that we have experienced when speaking with property buyers and sellers. Most people we speak to seem to believe that the market is coming back. They are seeing loads more SOLD signs on properties than they have been seeing in the past few years. They are feeling that mortgage finance is easier to get their hands on when they are buying. And they feel that this is the start of the market recovering for the longer term. In that environment, our job clearly is a lot easier (and about time, I say!).
What are my personal feelings about this? Cautious optimism. I’ve been saying, regularly on this Blog, for years now that people will always need to move home and that in the UK we have a love of home ownership that you don’t find in many other countries. However, if we keep getting good economic news and mortgage finance continues to free-up, there’s not reason that the recent ‘bounce’ in the market won’t continue. If schemes like the Help-to-Buy scheme, when launched in Scotland, help buyers to get into the market or move up the ladder (as long as they are economically sustainable and sensible in the longer term – the million dollar question) then this can only help too.
It’s clearly a great time to be selling: the number of SOLD boards and rising proportion of properties selling that come to the market are testament to that. It’s also a good time to be buying: house prices, although rising, are not flying through the roof and prices are rising without any evidence that I’ve seen suggesting that prices are going to plummet.
If you want to be one of them, please give us a call and let us help you either with advice on the valuation, sale or purchase of your next property. It’s free of charge and, who knows, you might just end up with your dream home!