As the clocks go back and the nights draw in Nick Churton of Mayfair Office offers some frank advice for sellers this autumn.
From time to time, as autumn falls, mists envelop us and it is hard to see ahead. In the property market mist has come early this year and it is difficult to predict a pattern.
This time last year the market was relatively buoyant. Following the credit crunch it had bounced back strongly from two or three particularly trying years. But now we can see this for what it was. The activity was mainly through buyers with no need for a mortgage. They were able to cash in on pent-up demand to sell. Also, in London particularly, foreign buyers were taking advantage of a weak pound against other currencies like the Euro and the Yen.
Now we enter a new phase after the government has unveiled a radical set of measures to curb public spending. Already the squeeze can be felt and nowhere more so than in the property market.
Discretionary property purchases will take more of a back seat in the months ahead. It is largely those who have to buy and sell that will buy and sell. But besides government cut backs, other dark forces are also at work to make things less than easy. Lenders are still making it hard to borrow money - despite their protestations to the contrary. Added to which some sellers, encouraged by last year’s price surge, have been reluctant to accept the new reality. Now over-priced property is lingering on the market – ignored by those with as much sense as money.
But when the mist evaporates autumn will unveil itself as a glorious season of rich colour and crystal clarity. For the property industry it is clear that this could be a fruitful time for those that take care to understand this market.
So to get the correct results this autumn there is important work to be done for both sellers and buyers. For sellers price is the key. They should listen to experienced estate agents and not make their home the most expensive in their road, street or lane. They should make it the most competitive and offer the best value for money. Buyers like value for money. Nor should they be seduced by naive, incompetent or untruthful agents who flatter to deceive with inflated valuations. They should listen to their heads not their wallets.
Sellers should get their finances in order – for those with enough deposit there are some good deals around – but they should not have eyes bigger than their pockets. We are, after all, entering a period of austerity. Prudence is good. There will be a good choice in the market so for those with cash or a mortgage this should be an excellent time to buy. But it is still wise to remember that a smaller house in a popular location can often be a better investment than a bigger house in a less popular one.
Lastly, this autumn, it may be timely to remember the person who often will have as much, if not more, influence on the selling price of a property than anyone - a bank or building society valuer. Right now they are in the driving seat for those who need a mortgage or those selling to someone who needs some finance. It would be better to be realistic about the price in the beginning as these valuers certainly will be realistic about the price in the end.