'Sold' homes on the increase
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By Kate Faulkner
It's essential to monitor all the
markets.
The problem with property price
reports in isolation is that they don’t consider what’s actually
happening from a volume perspective.
I study property data on a daily basis
and believes it’s wrong to talk about the property market as if
there is just one.
There are lots of property markets and
it’s essential to monitor what’s happening with regular buyers and
sellers, new homes, auction houses, rentals and investors.
There are also other market indicators
that are much better than property price reports which indicate
what’s happening now and likely to happen in the future.
For example, a company called For Sale
Sign Analysis monitors Sold boards versus For Sale boards at
regional level.
At the height of the market, on
average across England and Wales, most areas showed 40 per cent of
properties were Sold versus For Sale.
Since 2008, Sold versus For Sale
boards fell to around 14 per cent, but since the New Year the
number of Sold versus For Sale boards has increased each month to
their current levels of 29.5 per cent.
Finally, another indicator on whether
the market has bottomed out or not is the price and sale of new
homes.
Unlike second home owners, developers
will sell their properties at a price people are willing to
pay.
Last year, new homes prices fell but
this year as they are being sold at similar prices to the cost of
building, developers would struggle to drop them further.
Where are the property markets heading
in 2009?
All property markets are in dire
straits, mostly due to the lack of volume, which is very much
influenced by doom and gloom reports lowering confidence and the
lack of mortgage availability, coupled with the fear of, or actual
unemployment.
The only market doing well from a
volume perspective is the rental market, which although prices are
depressed slightly, is booming with people opting to rent rather
than buy.
Kate Faulkner is one of the UK’s top
property experts and author of Which? property books and managing
director of consumer property website http://www.designsonproperty.co.uk/
Wednesday, August 19 2009
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