Ripple will bring good news
THE nation looks to London for its lead in so many areas of our lives. And property is certainly one of them.
What happens in London influences what happens in the rest of the country – given time. It is the ripple effect.
We naturally seem to look to the capital when gauging when it is best to sit tight or move on. In booms and busts over the past 40 or 50 years, London has acted as the nation's barometer.
Yet it is more difficult to see what's happening now. This time it is different. This is because central London property is acting as a banker to so many foreign nationals.
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While it remains such a stable and even profitable place to invest, it is hard to see this trend weakening.
It is by no means copper-bottomed, but central London has become a market unto itself in recent years and tends to mask the health of the UK property market in general. But even in London this super-market is limited to boroughs like Kensington and Chelsea rather than Tower Hamlets.
While there is so much international uncertainty, London should retain its allure as a sanctuary for threatened capital. What average Middle Eastern oil billionaire is not going to invest overseas when his entire region is in the grip of Arab Spring fever?
So London is now, as ever, divided into those who have a lot and those with not a lot. It is the latter group show what the overall market is up to.
Over the past year it has become clear that it is not central London but Greater London and the Home Counties which are leading the way. Not so many foreign oil billionaires are investing there – nor Indian or Chinese super-industrialists.
It is the comfortable, leafy and commuter-friendly towns that are perhaps seeing the firmest signs of an English spring fever in property.
Will this ripple to other areas of the country in the short to medium term? There are certainly signs of fresh activity in most counties and that is something we are seeing locally.
While the majority of properties we sell are bought by local buyers, more than a quarter of buyers are from London and the South East, with those from the rest of the UK and overseas accounting for more than 10 per cent.
There is definitely light at the end of the tunnel for the property market in Exeter and surrounding areas. People are positive about selling and they are more accepting of offers.
We have seen an increase in transactions and sales in January and February – and the number of sales falling through is down to almost none.
There are also a lot more good-quality instructions this year. This has less to do with economic conditions than people being fed up waiting to move.
There are always people who have to move for a variety of reasons, such as job relocation, marriage, divorce or having children. For a while after the property market dipped in 2008, those people were renting their houses out and renting somewhere else while they waited for the market to rise again.
People have now got fed up with that and are accepting there probably isn't going to be an increase in the market and just getting on with it.
What was holding the market back was people saying 'I'm not going to sell because I want to get more for my house'. What your house is worth now is probably what it's going to be worth for a while. As the weather improves, I expect the local market to continue getting busier. It's never going to be like 2006, but I think it's going to be as good as we have seen since then.