Ok so maybe the headline caught your eye and you thought “is this guy nuts!” (Sometimes!). But it wouldn’t surprise me if this is the headline on the front page of London papers within 18 months and listed below are a few reasons for my choice of headline.
Appetite Versus Confidence – End User Market
Yes, the buzz word for the last two years has probably been ‘uncertainty’ and estate agents will probably confirm that most of their end user clients are ‘waiting’ to enter the market. However, appetite for purchasing is definitely there, the British fixation with owning their own home has not disappeared (Monopoly is basically on their school curriculum as homework!) it’s just the cautious side of character which is holding the buyer back.
So, have a think for one moment what will happen once the global outlook or perhaps looking closer to home, the Brexit question shows signs of being resolved?
I take the view that you will see a wave of activity hit the market. And this is a market with limited stock at present with many owners choosing to renovate rather than moving and selling for a ‘reduced price’. So, when confidence returns, so will buyers and they will be competing for this limited stock. Agents will see what is immediately happening and commence valuing higher and they will probably achieve these augmented prices. The market will inevitably move upwards.
Opportunity is Knocking
So, should you wait to enter the market with the masses or would now be a good time to capitalise on what is a soft market? The counter argument to the above would be that prices will become even softer, as the Brexit question no doubt still has some distance to travel. Though any trader will tell you, trying the pick the bottom of any market requires a crystal ball. So, ask yourself this question, would you prefer to purchase when the market is rising and no doubt at higher levels than today?
If you are buying with a 5-10-year plan or longer if you are purchasing a home, then NOW is the time to enter the market. Prices may soften further but if you follow certain buying principles you can achieve below market levels now. Try not to over complicate the process, I am sure you have heard of ‘buying low and selling high’ and in my opinion, we are in the ‘LOWS’ now!
Take the Plunge
Do consider also that a property is principally a home before being an investment. It is all too easy to find excuses not to buy in this market so unless you believe prices are going to fall off the cliff, take the plunge! Is renting for another year showing good investment nous?
Transactions are still occurring in London and resistance levels do exist (if a property shows value it will get bought). Have a look at what happened to prices post the credit crunch in 2008. It didn’t take long for prices to be rise above these levels again.
The majority of my buyers are coming from overseas at the moment, and they are taking advantage of these market conditions. So apart from a currency play, why has the international buyer got more confidence in the market, especially as they are buying for purely investment purposes? And even though we have heard about further taxes to international buyers from the government, I doubt this will dissuade them from the UK.
London is a primary choice for the international investor and although I have seen some of my peers knock this policy (and yes stamp duty is getting a bit out of control), if anything, it is already employed in many global cities around the world and brings the UK in line.
So, the good news for the serious buyer out there is that the Property Boom isn’t happening just now. There is still time to get ahead of the market and play on the uncertainty that is apparent. Just do not wait too long and miss the buying opportunities and potentially price yourself out of the market once the uplift returns.
Look forward to your comments and feel free to DM if you would like to discuss how I can assist your purchase.