Hamptons International – Market Update- 19th December 2016

As we all begin our countdown to the Christmas period, I thought it would be a good time to look back over 2016 and a couple of wishes for 2017 over a mince pie!

Well it has been a tempestuous year to say the least with unexpected political twists and turns and although there have been some highlights I think it is safe to say we will be happy to start a fresh in January!

We started 2016 with all the joys of unbroken resolutions after our best year on record since we opened, with plans to make 2016 even bigger.  The first quarter showed promise with good activity levels across the board and the teams firing on all cylinders with, in March, our region of London (North, South & East) turning over its highest amount of business on record.

Part of this was undoubtedly related to buyers wanting to maximise opportunities before having to contend with the tax changes, including a 3% rise in April on Stamp duty on second homes. Plus, landlords are no longer able to obtain the flat-rate 10% wear and tear tax deduction, claiming for specific expenses in its place and the gradual removal of mortgage interest relief over the next few years, which removed most investors from the market in the short term.

Then of course came the EU referendum, with the pre and post uncertainty that surrounded it. Unfortunately there is no beating around the bush, the vote for Brexit did have an adverse affect on the market and initially Battersea as an area was one of the worst affected. We dusted ourselves off, however, and in most cases managed to re-tie deals that fell, albeit at slight reductions.  If anything it sorted the wheat from the chaff – I personally think the property market is much like a game of pairs and when you get rid of the unmotivated pairs, deals are far more solid, in turn bringing ‘fall-through’ levels down.  We have had to spend the rest of the year grafting and the silver lining for us (being an International company) is that the weak pound has bought those buyers back, plus having access to such large pool of buyers across our network has never been more fruitful, with 60% of our buyers this year having not originally registered in Battersea!  This demonstrates the value of a big International agent – as they say: “when the going gets tough, the tough get going…”

It’s not all doom and gloom, however – like anything the more time that passes the better, people need to get on with their lives and ultimately if you have a 5 year plus view when it comes property, history shows the market will level out and bounce back.  Also if you are buying on, it is likely that whatever reduction in price you make to your sale, you should be able to negotiate, within reason, from your onward purchase, as this is not a London centric situation.

New buyers are starting to appear on the horizon now, with last week being our highest viewing week since 3^rd week in October, which is unusual for this time of year, showing buyers are re-igniting their searches as they now feel the market is settling.  Plus I think a dose of optimism and belief goes a long way in this sort of market.

The main re-occurring theme in all this is uncertainty, which is never conducive to a level market, so my wish for 2017 is simple – an element of certainty on all fronts, although I think that is a bit of an ask!  Therefore I would also like open and honest valuing by all agents, with real, unadulterated, comparable evidence of prices actually achieved by similar properties in similar locations supporting the price.  Also, can we remove the ‘highest price, lowest fee’ mentality from anyone thinking of selling?  Rarely in any walk of life does this end up having a satisfactory outcome.

I’m sure that you will have heard this one from many borrowers but can we please keep the interest rates low as at least it is stimulating buyers and has a very positive effect on activity.

Finally I would like to say thank you for reading my updates, I hope you enjoy them and of course if there is anything you would like me to touch on in future posts do let me know.  I wish you all a very Happy Christmas and New Year.

As ever, this update, as well as all of my previous missives is available to view on our blog, which also links to our Twitter feed and can be seen here: hamptonsbattersea.co.uk

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