What the barber said…
Firstly, the election. As you will see, our view is that in the shorter term, this changes very little. The result has been known for some time and has already been priced into the market. While there will be many who ease back and wait for the dust to settle, there is an excellent pool of committed vendors and focused buyers – at Maskells, we are getting on with the job and making the most of what has been a busy market.
The sales market is hard to read and is unique in its reaction to each property – more than ever at present. This weekend past, I was reflecting on the state of the world considering a haircut at a barbershop on the King's Road. Love them or hate them, a barber and a taxi driver will always give you an honest view. The barber was struggling – his last day of paying customers before closing down. This was put down to a changing demographic and a lack of families moving here post Brexit. Could this really be true?
Looking at buyer demand, it is certainly there and we are seeing particularly good interest in family houses. Comparing the last three months to the same period last year, new buyer registrations are broadly similar. However, those buyers are viewing more properties, and are committing in very healthy numbers – our offer levels are up by 53%. There are many who cried “election lull” however the reality is that there is a market, the election result changes very little and focused buyers are reacting positively to properties that are correctly priced. Indeed, we are in a strange position where seller and buyer interests are broadly aligned. The present activity demonstrates it is a good time as a seller to be accepting an offer, and it is a good time to buy before we see any increases in tax that are expected from the new Labour government. Our view is that post election, we don’t expect to see any revelations – vendors who are not seeing the interest they expect and are waiting for a bounce after the election, could well be disappointed.
For those looking to buy, we see now as an excellent time. Time and time again, we see properties advertised and buyers hold back. The price is then reduced and multiple buyers compete, driving the price up to over the original asking price. Value is being proven, so why wait to buy? For those looking to sell, liquidity is a key concept. If selling to make another purchase, a buyer offering from a position of liquidity, without a chain, makes you a stronger purchaser. Further, if capital is invested in the markets or placed in a high interest cash account, gains made in the medium term can be used to bridge a potential gap between budget and pricing of the ideal property. Liquidity creates possibilities.
While I regret that the barber is having to close his doors, it seems to me that the connection between Brexit and a lack of demand for London is somewhat unfounded. There is a market. But maybe at £65 a haircut (too much for me!), he, like some house sellers, needs to look at pricing…