Thursday, March 12, 2015

What properties are actually selling in Melton?

Prices up, prices down, prices stable .. the newspapers are full of good news, bad news and indifferent news about the UK’s favourite subject after the weather .. the property market!

The thing is the UK does not have one housing market.  Instead, it is a patchwork of mini property markets all performing in a different way.   At one end of scale is London, which has seen average prices grow in the last twelve months by just under 19% (again that is an average because some Borough’s in London have risen by 26%) whilst Wales only saw a 2% increase in property values (The Merthyr Valleys dropped by over 11%).

Well we can’t ignore the rest of the UK, and we can’t forget that the Chancellor’s Stamp Duty reforms have polarised the London property markets above £1,000,000, because at the top end of the market, punitive Stamp Duty charges will dampen demand further.  

While the Bank of England warned of the growing London property price bubble in the Spring of 2014, even talk of a recovery in some areas was premature.  In 2015, irrespective of where you are in the UK, one story will unite the patchwork quilt of markets –  really slow property value growth.

But what about Melton?   Well, we haven’t had the December figures from the Land Registry yet but the last few months’ activity and prices achieved would suggest neither house price growth nor drops.  In fact, most sellers are buyers anyway, so if you need to take less for yours, you won’t have to pay as much for the one you want to buy ...  this is good news for everyone as most move up market when they move.  This is even better for landlord investors, as they can bag a bargain as well!

The question you should be asking though is not only is what happening to property prices, but which price band exactly is selling?    I like to keep an eye on the property market in Melton on a daily basis because it enables me to give the best advice and opinion on what (or what not) to buy in Melton. 

If you look at Melton and split the property market into four equally sized (into terms of households) price bands.  Each price band would have around 25% of the property in Melton, from the lowest in value (the bottom 25%) all the way through to the highest 25% (in terms of value). 

Over the last two months (63 days to be precise), in the lowest quartile, (those with asking prices under £130) 43 properties have come onto the market in Melton and 16.2% of them (7 properties have a buyer and sold stc).  The next quartile, £130k to £170k, 50 properties came on to the market, 32% of them (16 properties) have a buyer.  The £170k to £250k price range has seen 37 properties come on to the market, 21.6% of the properties have a buyer (8 properties).  The most expensive 25%, the £250k plus range, has seen 2 of the 23 properties that came on to the market find buyers (8.6 %). 

Fascinating don’t you think?

The next three months’ activity will be crucial in understanding which way the market will go this year and I honestly believe we will not see any house price growth or drops this side of the election. Election or no election, people will always need a roof over their head and that is why the property market has ridden the storms of the Oil crisis in the 1970’s, the 1980’s depression, Black Monday in the 1990’s, and latterly the Credit Crunch together with the various house price crashes of 1973, 1987 and 2008.  Why?  Because of Britain’s chronic lack of housing will prop up house prices and prevent a post spike crash. ... there is always a silver lining when it comes to the property market! 

If you would like some advice about buying to let, be you a landlord with a portfolio or someone thinking of investing in the rental market for the first time, please pop in and see me at our office in Burton Street, Melton Mowbray or call me on 01664 569700.

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