The residential property market thrives on confidence, a commodity that has been sadly lacking for some time. Irrespective of your political stance, it is already apparent the dramatic outcome of the general election will significantly fuel the activity bounce I predicted in my last article in the Property Post.
The FTSE 100 of blue-chip companies and the FTSE 250 which is more steered towards domestic companies, endorsed by comment across the UK commercial and residential property press, are awash with positive sentiment and belief there will soon be a clearer sense of Britain’s future. So as we move into 2020, I predict the Yorkshire residential property market will see a noticeable bounce in activity in the first quarter of the new year, and that what some are already calling the “Boris Bounce” will continue into the second quarter, underwritten by the traditional spring market place.
Is it good news for all concerned? Well that is certainly my view albeit with a degree of hesitation. I do not believe there will be a corresponding price bounce at least for the foreseeable future. However, I suspect there will be some who have already convinced themselves this will happen in short order in 2020 and who already intend to price their homes for sale accordingly in the New Year. And this is where I fear the market could prove to be vulnerable with the risk that the recent sales stagnation created by Brexit could continue if buyers and sellers are unable to align their respective aspirations. Utilising a large dose of Yorkshire commons sense, I therefore have a few suggestions for those who plan to sell and/or buy in 2020:
- Please remember that any commodity is only worth what someone is prepared to pay. If you are selling and already on the market, you might now think post-election your home is going to be worth 10% more than the best offer you have had over the last 6 months. However what has fundamentally changed about your property when you will be up against houses that are being newly launched to the market in the new year?
- Assuming you intend to buy at the same time, can I suggest that you don’t just focus on the headline figures. Surely it’s the price differential between sale and purchase that is the most important factor, in which case the art of negotiation becomes paramount. You might be of the opinion your buyer has driven a hard bargain and that you intend to “do unto others”. If that is the case can I add a word of caution. Not every seller will automatically reduce their price by a large percentage because you say you have the cash especially when you have convinced yourself the definition of cash comprises the equity from your sale and “cash” from a lender.
- By contrast, irrespective of whether you are buying or selling, please avoid playing what I call the ambivalence card. Just because a seller doesn’t accept your first offer do not take the hump and refuse to make an improved offer when in reality you want to buy. And if you are selling, how many times have I heard an owner say they don’t have to sell as the justification for not accepting a sensible offer, in the belief a buyer will then offer more.
I am sure 2020 will be an interesting year for all those involved in the residential property market. To those who have kindly read my epistles over the last 12 months many thanks and Happy New Year.
Tim Waring FRICS is Head of Residential at Lister Haigh www.listerhaigh.co.uk