The UK property price trends that we’ve seen in the last 12 months appear to be continuing with marginal price changes reported by major UK financial institutions, Halifax and Nationwide Building Society for the end of summer. According to the surveys, the average UK house price is now £161,743 to £165,914, representing a month on month decline of between 0.6% and 1.2%.
Reports indicate that unrealistic asking prices are stalling many prospective sales with sellers valuing their properties at too high a price for the current market. A recent survey conducted by Cartus’ UK estate agency network, Home Sale Network found that 83% of survey respondents believe a property’s asking price remains key to achieving a successful sale. Indeed it is critical for sellers to set the correct asking price as soon as their property comes to market.
Asking prices aside, the UK mortgage market remains the key challenge for many, prompting the Bank of England to freeze the base rate at 0.5% for another record month (31 in all!). Nevertheless, low property prices and interest rates – which the UK currently boasts – have never been the hurdles that potential buyers must overcome to enter the property market. Instead, it is the high mortgage deposits that UK banks and building societies require potential buyers to have to secure a mortgage loan.
In the rental market, prices continue to soar as tenant demand far outweighs the current supply of lettings properties, which is especially the case in London. Relocating employees seeking temporary accommodation must act quickly to secure leases and – given the limited supply available – must also demonstrate a certain amount of flexibility when viewing properties.
As home ownership declines to its lowest level since the 1980s, the UK economy currently offers nothing to suggest that the rental market imbalance will begin to subside in the short term. Indeed, with the economy growing just 0.2% in the second quarter of 2011 and already 18 months into the recovery, UK activity remains an estimated 4% below where it was in 2007 (Office for National Statistics 26 August). Nevertheless, both Nationwide and Halifax expect the current trend of stability to remain with house prices and activity continuing to ‘move sideways’ (Nationwide 1 September).
When selling relocation homes, Cartus encourage clients to:
1) Have employees set a competitive initial asking price on their properties
2) Conduct an early review of the response to the asking price set
3) Continually review the marketing strategy adopted to sell employees’ properties
These recommendations will remain key to achieving a sale between now and the end of the year.