Musings of a London Property Finder

House prices have risen in May 1.2% according to statistics produced by Nationwide, however Chief Economist Martin Gahbauer warns that rises are due to decreased supply and cheap prices and are not necessarily signs of a recovery, although he says they are evidence of some improvement in the property market.

Commenting, Gahbauer said “Although the short-term trend in house prices has clearly improved from where it was at the beginning of the year, it is still too early to say that the market is turning definitively.” 

€œDuring the downturn of the early 1990s, there were many months during which prices rose, only to fall back down again in subsequent periods.  In the current downturn, the combination of rapidly rising unemployment and tight access to credit implies that the last of the price declines has probably not been seen yet€œ, added Mr Gahbauer.

In other news this week, the British Bankers€™ Association said the number of mortgages approved for house purchases rose by 4% in April compared with the previous month, rising from 26,671 to 27,685 approvals.  However, compared with April 2008, this represented a fall of 15.5%.

The average house price now stands at £154,016. This is 11.3% lower than a year ago, much better for house sellers than the 15% annual decline reported in April.

Gahbauer added that during the downturn of the early 1990s, there were many months during which prices rose, only to fall back down again in subsequent periods.  He concluded: €˜Survey evidence suggests that buyer interest has picked up strongly in response to lower prices and lower interest rates.  If this buyer interest translates into actual sales and outweighs any potential increases in supply, then the recent moderation in price falls may continue. For the moment, however, it is unclear how the balance between supply and demand will ultimately work through in the coming months.€™

But as with other indices showing house price rises recently, market commentators were quick to advise caution about any hopes of a sustained recovery.  

On a positive note, for property purchasers, property porn afficionados and Property Finders like us the long-term prognosis looks good for buyers now.  As the graph above shows, prices have now dipped to in line with the long term real house price trend, so although they may well drop further in the short term, buying the right property at the right price now should bode well for the future, in the long term at least.

Technorati Tags: house price trends, House Prices, London property finders, Nationwide House Price Index, Property Finders

Tags: house price trends, House Prices, London property finders, Nationwide House Price Index, Property Finders

Musings of a Brighton Property Finder

Undoubtedly there are still fluctuations in the housing market and it is likely that these fluctuations will continue early into 2010.  The British Bankers Association spokesman, Derek Dooks,  reported a net lending increase in April although not as vigorous as in March.  He believes that  mortgage lending  has stabilised slightly.  Howard Archer from IHS Global Insight holds a similar view that €˜housing market activity has very likely passed its worst point€™ but predicts a €˜gradual€™ and €˜fitful€™ pick-up due to the €˜very poor economic fundamentals and still tight credit conditions.€™

So where does that leave us?  We, Property Finders, believe that there are good opportunities for all groups of buyers.  Most estate agents are advising their clients that, if they really want to sell their house, they may well need to accept offers.  This is borne out by comparing prices achieved with asking prices.  Our expertise and knowledge of the London market is a good starting point for buyers, as our interest is in achieving the most realistic price for our clients.  We also pride ourselves on our negotiating skills, agreeing deals based on up-to-date knowledge of the market.  One advantage of tighter mortgage lending controls is that, if a buyer has confirmed his/her mortgage or other borrowing arrangements before they actively start their search for a property, then they will be in a very strong position indeed.   Our experience with vendors confirms our belief that they will accept a prudent offer more easily, if it is accompanied by a proposed exchange and completion date and the buyer can demonstrate willingness to proceed e.g by getting the survey done PDQ and of course the magic words €˜cash buyer€™ spark real interest.

Our firm advice is that it is a good time to buy €“ so whether you€™re looking for a new home or simply a buy-to-let investment with a good yield €“ you know the Brighton Property Finders in the know!

Technorati Tags: Brighton Property, Brighton Property Finders

Tags: Brighton Property, Brighton Property Finders

Musings of a Brighton Property Finder

The Times carried an article today about an accountant with 3 buy-to-let properties in Shoreham which he rented out through Scarlet Property Services.  Sadly for Scarlet and the accountant, the letting Agency ceased trading, taking deposits and rent with it.  Scarlet Property Services wasn’t registered with Arla, so the landlord has no claim against the agent, apart from a contractual claim under contract law, which would presumably leave him little in the way of change after he had paid a lawyer to represent him for the £3,000 owed.

The accountant also feels he has to repay the deposit to the tenants, as although the tenancy was registered under the Tenancy Deposit Scheme, the contract was between the tenants and the landlord, so the tenants have a claim against the Landlord.  Although the deposit is protected by the TDS, it is the landlord who has to pay if the Letting Agent can’t which seems a bit unfair, since due to government regulation, Landlords are now prevented from holding deposits!

As a company, most of our rental Clients are in London and at weekly rents which render the terms of the Housing Act 1988, obsolete.  Deposits we deal with in London typically start at £20,000 and the London office always insist that the tenancy is registered with the TDS and is subject to the terms of the Housing Act anyway and alert the tenant to the risks if the agent is not ARLA registered.  We also do a great deal of owner direct deals in London, in which case the deposit is either held in our Client account or in the Client Account of a reputable lawyer.

In Brighton however, few rentals are of values which render the Housing Act redundant, and although the market is still buoyant the example of Scarlet Property Services exemplifies the intensification of competition in the rental sector since rental income has become the main revenue stream for estate agents nationwide.  And as for the know-it-alls proclaiming that landlords shouldn’t use non-ARLA registered agents – it wasn’t long ago that one of the biggest London Agents, Foxtons, wasn’t registered and their future has looked increasingly precarious until very recently.

Ability to find a good tenant used to be the key criteria for finding a Letting Agency.  Buy-to-letters buying through this Brighton Property Finders Agency, will be strongly advised to check the ARLA thing too!

www.landlordzone.co.uk

Technorati Tags: ARLA, Brighton Property Finder, Buy-to-let, Tenant's deposits, the TDS, What happens when letting agents go bust

Tags: ARLA, Brighton Property Finder, Buy-to-let, Tenant's deposits, the TDS, What happens when letting agents go bust