Nick Churton of Mayfair Office looks at how important it is to select the Correct Course this autumn.
What most people do when they see the inches piling on is to diet. Losing a bit of weight is a healthy thing to do. The property market acts in much the same way. After a period of excess, when things get a bit overblown, the market has a habit of paring itself down a bit. It usually makes it fitter in the long run.
We have been through a period of property overindulgence, and now the market is taking a breather. Trying to predict when this will end is fruitless - unless one knows how Brexit will conclude. The problem with shifts in government policy and national direction is that each will take its course and time to correct. The larger the event, the more it affects the property markets - both foreign and domestic.
A good example is how Germany’s reunification during the early 1990s affected the market in Spain - many Germans put off buying holiday homes there. Or in the UK more recently, when the government began scrutinising the origins of funds held by some wealthy foreign nationals. The result has been a marked decrease in property purchases - especially in central London.
There are many things we don’t know about the market as we enter the post-summer holiday period. But what we do know is that many first time buyers are choosing to buy a home and that this can only be good for second-time buyers and so on. Outside London there are continued signs of price growth, and there is a continued lively level of interest from buyers. These welcome signs are the results of the market slimming down.
The property market at present is rather like a swan in motion, not much seems to be happening on the surface but below there is plenty of activity. So don’t be deceived by adverse press reports and local gossip.
The market is correcting. The trick is not to try to guess an unguessable endgame, but to understand and take advantage of the correction in the meantime.
And the most correct course of action of all is to ask the advice of an experienced and successful local estate agent who has seen it all before.