All posts by GeorgeHartshorn

George is Managing Director at Elizabeth Davenport Estate Agents. He enjoys writing this weekly blog and hopes that you enjoy reading it!!

Faltering New Build Sales Add Pressure to Resale Market

Recent research by Warwick estates has found that over the last decade New Build Sales have fallen significantly. In 2011 there were 68,677 sales, but by 2021 that number dropped to 41,634. This represents a fall of 39% at a time when government promised additional new housing stock and the availability of resale properties also fell significantly. _dsc3981-hdr-copy

New build sales also fell year-on-year by -46%, as there were 76,764 in 2020. Whilst this could be attributed to some extent to lockdown and Covid, the development sector was in large part exempt from the lockdown rules so the figures are still nonetheless very disappointing.

With falling stock levels of new build properties, buyers are being forced in turn to look at the resale property sector instead. This at the same time as availability of resale properties is at a critically low level, demand outstripping supply significantly.

What does all of this mean for the typical homeowner or the typical buyer? Likely a continued upward pressure on prices, despite the underlying economic conditions and increases in interest rates.

A potential buyer asked me the other day “Do you think house prices will fall back again soon?” With demand massively outflanking supply my straight, honest answer was “No. not any time soon.” Only a fall in the availability of finance would apply the brakes at the moment and there is no sign at present of this happening, despite the interest rate rises.

If you would like a professional opinion on the current value of your own home, speak to one of our experts by calling 01789 549 549. We’d be delighted to help.

 

Add Further value to your Property!

Are you wondering what the easiest ways to add value to your home are? Perhaps you’ve thought about extending or adding a further bedroom? Or maybe refitting the Kitchen, Bathroom or Ensuite?

But with most of us on limited budgets, it’s often not possible or practical to do all of these things, so faced with a choice, how is it best to prioritise if maximising the value of the property is the ultimate goal?iStock_000002696243XSmall

Working with the space that already exists can often present excellent opportunities. Extensions if planned and budgeted carefully CAN work well but also present great opportunity to overspend, especially if the project encounters unexpected problems such as planning rebuffs or delays in the work which can quickly cause costs to spiral.

Here are some great ways to add value in an effective way and on a limited budget:

Loft Conversion – A great example of utilising existing space is a loft conversion. Usually you won’t need planning permission (though building regulation approval WILL be required) and the cost will most likely be considerably less than a 2 storey extension.

Knocking through an existing Kitchen & Dining Room – This is a relatively easy and cost effective way to add value. If your Kitchen and Dining Room are adjacent and can be knocked through creating a modern and desirable Kitchen/Diner this will be a great way to add value.

Refitting an old Kitchen – A stylish Kitchen is often a huge selling point for any property, so a refit can be very cost effective. The trick here is not to overspend, the choice of units and appliances will be critical.

Converting an existing outhouse or garage – this can work very well especially if the outhouse is attached to the property and can be accessed directly from the house.

Redecoration – A simple and obvious way to maximise value. Keep the decor light and bright, no garish or frightening colours. Light colours will also help to bounce natural light through the property, a big plus when you come to sell.

If you would like further ideas or advice on how to maximise your sale price then call us on 01789 549 549 and we’ll be happy to come and visit your property to discuss in more detail.

The Cost of Trading Up in a Rising Market

House prices have been significantly on the rise in the last couple of years. In some parts of Warwickshire prices have risen around 30% during the pandemic, defying all of the doom mongers’ predictions when Covid first struck. iStock_000002696243XSmall

But what do these big price changes mean for you as a homeowner? Do you check your property value on a regular basis or have sleepless nights about it?

Hopefully not. However, if you decide to move home then the price increases will undoubtedly have an impact on your moving decisions at that point. If you need to downsize then congratulations. You will be able to cash in on your property’s increase in value and should be able to comfortably purchase a smaller home and walk away with a tidy margin at the end of the process.

But what if you are upsizing or perhaps you are a first time buyer? For sure, first time buyers will have lost out. They will need to have a bigger deposit saved up, trying to save as fast as the market is rising is a tough ask.

For the large numbers of growing families who need to upsize, price increases are also not such good news. It may feel good to look at the latest Zoopla Index and see your property value grow, but if the larger property that you desire down the road is going up in value at the same percentage rate then it is getting further and further out of reach as time goes by.

With high demand and low stock levels remaining as the 2 big underlying fundamentals to market demand, upward pressure on prices is likely to remain in place for the foreseeable future. In other words the longer you hold off on that upsize, the tougher it will be to finance when you do decide to take the plunge. So right now, the wait and see approach is costing you money!

Book a valuation today and get the ball rolling on your next home move. Speak to one of our experts on 01789 549 549, we’ll be delighted to help!

The Fear of Moving Home

Current market conditions for property sales are giving mixed signals. High demand from buyers but little to choose from is still providing upward pressure on prices. At the same time there is a reluctance amongst some sellers to ‘take the plunge’ and list their property for sale. 2022_BEAG_SALES_EXCELLENT_BORDER_LS

Q. But what is there to be afraid of?

Conversations with potential sellers show that there is a pattern here, generally the reluctance is due to fear of not being able to find a suitable onward property. The reason: there’s not much available at the moment!!

This catch 22 scenario is not uncommon in the housing market and is certainly not a new phenomenon, after all who wants to sell and then be left homeless or forced to go into rented.

In reality this ‘doomsday’ scenario’ is not a realistic pitfall. The advantage of the English & Welsh property market is the flexibility of the system. Until exchange of contracts there is no legal obligation to go through with the sale and no possibility of being forced to move. This ‘flexibility’ of course has plenty of downsides including gazumping (when another buying outbids the original buyer), gazundering (when a buyer reduces their offer at the last moment), withdrawal, fallthrough, etc.

In Scotland by contrast, once an offer is accepted, the buyer is contractually obliged to go through with the transaction, as is the seller. So one can understand a reluctance of Scottish sellers to go on sale if they haven’t found somewhere to go. But in England out system provides that flexibility and choice right to the finish line, meaning if a seller can’t find somewhere to move to then ultimately they don’t have to go through with the sale. So the reality is that there is no risk in going on sale.

Q. But isn’t it expensive to go on the market? We don’t want to waste money unnecessarily?

If you use a traditional estate agent there’s no cost either as fees are only charged upon completion of sale.

For further advice on selling or buying in this ever changing market speak to one of our property agents who will be delighted to help.

Landlords – Are you ready for tighter regulation?

Just as you thought it was safe and the government couldn’t bring in any further red tape for Landlords, think again!Red-Tape

With ever increasing regulation, the burden on buy to let property investors seems to be never ending and increasingly arduous. Are you a Landlord worried by regulation and concerned whether your property will shape up in the coming months and years?

One major piece of legislation that looms on the horizon is the minimum EPC requirements for all privately rented residential property. Currently a property must have an Energy rating of A-E. However the government is proposing to change this to A-C by 2025. This would represent a major shift and leave a large proportion of the current rented stock and landlords out in the cold and unable to let their properties, in just 3 years time.

To put this requirement into perspective, some new build properties are only scoring a Grade C so if you have a Victorian or Edwardian property, the task of bringing this up to a C in order to comply with the regulations is considerable, and in many instances will be impossible or simply not viable.

There will be exemptions to the rules of course. Listed properties will not need to comply and if you can prove that the work is not ‘financially viable’ then you may also be exempt, but this will not be an easy thing to prove.

It is conceivable that government will back down on this between now and 2025, however this is a major part of their strategy towards net zero and without schemes like this working, they have little chance of meeting those goals, so it would seem that there may be some small concessions but tighter regulation is definitely coming and now is the time to start preparing if you are (or want to be) a landlord.

For further information on the current landlord responsibilities and future legislation speak to our Lettings Manager Carol, who will be delighted to assist.

PROPERTY PRICES SET TO RISE IN 2022

Just 2 weeks into the new year and a pattern is already emerging for the year ahead. Rightmove have just reported the busiest start to the year ever in terms of new enquiries, yet at the same time reported the lowest stock levels ever.

For those of us who did GCSE Economics, one thinks of the Demand vs Supply graph and the inevitable move up the graph this leads to in terms of price. For those of you who were lucky enough to avoid studying Economics at school then simply picture a shop full of eager buyers and just a few items left on the shelf, the inevitable rush this would create and the shop owner effectively being able to ‘name her price’. It’s not rocket science.Board Images

The current shortage of property for sale seems to be exacerbating the problem, with some homeowners (who need to move) scared to go on sale for fear of not being able to find somewhere to move to. Understandable but not logical.

February, March and April are traditionally the 3 busiest months of the year for the sale market, and the signs are there that new stock will be coming available very soon. All 3 of our branches are currently busy with valuations and the pipeline of new property is building up.

Do you need or want to move in 2022? If so the best properties will likely be coming to market over the next few weeks. Will you be ready and able to pounce when the RIGHT property becomes available or will you miss out yet again because your own home wasn’t sold or wasn’t even on sale?

Elizabeth Davenport can offer you a no sale/no fee option so if you market with us there is no risk of being out of pocket. If you can’t find somewhere suitable to move to then you simply stay put and there’s no charge. Invite our expert valuer to visit your home today and get free advice on your property value and the current market conditions. We’d love to help.

2022 – What next for the property market?

Following the new year celebrations, you may be wondering what lies in store for property prices. Perhaps you are thinking of moving this year or looking at your investment portfolio and looking for some pointers as to where prices might go in 2022?

If that’s the case then you’re not alone. After a very busy year in 2021 for property sales, things cooled off a little at the end of the year. Does this mean that without any Stamp Duty holiday, 2022 will be much quieter?selling your property

Our office opened for 2 days between Christmas and New Year and if the activity during those 2 days was anything to go by, then the market ‘bears’ will be disappointed I’m afraid and the market ‘bulls’ will be excited going into New Year and Spring.

Demand remains high for all of the properties on our books. The fact remains that many workers need to move this year due to changes of jobs and large numbers of sales each year are also due to forced circumstances, so the ‘wait and see’ gang are just a very small portion of the market place.

The main unknown for the year ahead will be supply, but if things remain similar to the last few years then demand will outstrip supply again and that will only create further upward pressure on property prices. Interest rates may go up a little but still remain historically low, so the cost of borrowing and the availability of mortgage funds remain strong factors in all of this.

Ultimately the market looks strong going into 2022 and property remains a strong investment prospect for the foreseeable future. If you would like further advice for the year ahead on your property then call our office and speak to a professional. We’re here to help.

In a Boom Market, does the Presentation really affect the Value?

In a boom market, where everything that goes on sale seems to sell instantly with multiple offers and buyers clamouring to purchase, we sometimes get asked the question: Does the presentation really matter that much? Surely the property will sell anyway is this market?

That may be the case, however a large percentage of potential buyers will still be turned off by clutter or a lack of cleanliness, or ancient wallpaper, or pet smells. And if a substantial portion of your market is frightened off then you are effectively reducing demand and therefore value.

The good news is that it doesn’t necessarily require a large budget to bring a property back to life and give it that extra kerb appeal again. Simply cleaning, tidying and decluttering can make a world of difference. That does means the whole property including the exterior, interior and gardens (if any).

Excess furniture and clutter should be packed away or put into storage, childrens’ toys cleared away, any peeling paintwork should be touched up. In bathrooms it’s essential to replace mouldy sealant and revive any dirty grouting. Kitchens need to be ultra-clean and free from grease and grime. Broken cupboard doors must be fixed and dirty carpets should be cleaned or replaced. Bad smells (from dogs or other pets) must be eradicated, they’re a real turn-off for buyers.

Lawns should be cut, hedges trimmed, borders weeded. A few nice potted plants and hanging baskets will really freshen things up. The driveway or front path should be freshly swept and a new front doormat saying “Welcome” will create an inviting first impression.

And if you simply don’t have time to do all of this then you should pay someone to do it for you. It will be well worth the investment. A clean and well presented property will always sell before a similar property that’s messy and untidy. Put quite simply, a better presented property is worth more money.

For further expert advice about selling or renting your property, call one of our experts today and we’ll be happy to chat.

 

Will a Heat Pump add value to your home?

The government will offer landlords and other homeowners grants of £5,000 from April next year to install heat pumps and other low carbon systems.

The first thing to say is that you’re not going to be forced to remove your gas boiler any time soon, or even in the future. Having just installed a brand new one at my own house just last year this came as a big relief following yesterdays announcement.Heat Pump

Heat Pumps aren’t a new technology, they have been around for many years, however uptake has been very slow due to the burdensome costs of installation. Ground source heat pumps are only practical if you have plenty of land on your property so most people would be looking at air source heat pumps. These typically look like a large air conditioning unit stuck on the side of the house, so again for practical reasons many people have discounted them, especially perhaps if they live in an apartment or a terraced property.

As uptake increases with the implementation of the grants over the next few years, home owners and buyers will become more familiar with this type of heating system, perhaps starting to see them as adding value to the property. Or perhaps not?

At present, the vast majority of homes in the UK either use gas boilers (or modern electric heaters to a much lesser extent) and this is what the majority of buyers expect to find and see value in. With the cost of an air source heat pump ranging up to around £18,000 compared to a gas boiler system at around £5,000 it will take a big shift in price and lots of encouragement from the government to make heat pumps main stream.

So for now, spending the £18,000 on a new Kitchen and Bathroom will add a lot more value to your home. Let’s hope as time goes by, costs come down and we can all work towards a carbon free housing stock and economy.

MASSIVE HOUSE PRICE INCREASES – TIME TO SELL?

The government’s latest house price index report (published on 15th September 2021) showed some huge price increases year on year. Local area’s that saw some of the best gains included Coventry prices increasing 8.7% (versus the national average in England @ 8%). Warwick’s price rises were more modest at 2% while Stratford Upon Avon saw a whopping 18.7% increase for the same time versus the previous year. Stratford’s average price now stands at £355,000. Warwickshire as a whole faired very well with average increases of 10.9%.

iStock_000002696243XSmallWith prices so high right now and no way of predicting what the market will do next, selling could be a smart move for those looking to cash in, downsize or release some equity. There are of course plenty of other scenarios where sellers will benefit including deceased estates and separations.

If you’re a first time buyer of course, this won’t be the news you were looking to hear. Having said that, borrowing rates are at an all time low so whilst you may have to stretch your deposit a little further, repayments will be very modest once you’ve made that first purchase.

Long term, purchasing bricks and mortar still looks a very safe bet. Compare average house price increases to current savings rates or other investments, including bonds and ISAs, or perhaps even versus the volatility of Crypto investments, the saying “as safe as houses” still rings as true today as it did 50 years ago.

For professional advice on all aspects of buying or selling speak to one of our experts. Contact Elizabeth Davenport on 01789 549 549.