These are unprecedented times indeed for the property market.
The post lockdown boom drove sales to unseen levels and properties were swapping hands for record prices. The rise in selling prices sent home report valuations in certain areas to a new high.
But for investors, a sellers’ market is not a time to be building portfolios unless you are a developer riding a rapidly rising market.
But now, that tide of desperate buyers has passed and suddenly we are seeing a market where, previously you would expect four or five notes of interest per property, now we are seeing an average of only two or three. If you consider, on average, only one or two of these notes of interest will result in an offer then the market is much less competitive. And in turn, home report valuations are returning to a “sensible” level.
Couple this with a wealth of desperate sellers who missed the post-lockdown peak of the market and the penny is beginning to drop that perhaps they won’t get the price they had previously expected back in August.
Unfortunately lenders have pulled most of the deals that were so attractive to first time buyers. The days of the 90-95% mortgage are disappearing quickly - as has the government help to buy scheme (although Westminster have just announced plans to replace this with a new scheme in response to lenders’ tighter critera). We have multiple properties which have had offers accepted, only to be back on the market a month later once lenders have withdrawn their products. Yet the market has cooled since the and sellers are having to accept much lower offers.
The market may indeed dip slightly over the next year, as many economists have predicted, but right now, the starter/investment home market is providing somewhat of an opportunity for investors.
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