Property market comment
November 10 and into 2011
Unlike the rest of Europe the UK is much more in control of its own destiny given it is outside the Euro currency and does not have to act as a single unit.
If the Government’s policy is successful the exchange rates with the dollar and the euro will hold up and this in turn means that interest rates here can remain at historic low levels.
With this in prospect, house prices should remain steady and indeed in some areas such as prime central London increase as overseas investors see quality real estate in London as a good and safe long term investment.
Prime property looks as though it will weather the economic climate better as such properties are usually purchased with borrowings forming a far smaller part of the purchase price. The decision to purchase it based not so much on the accommodation but the aesthetics of the property, period, style and location are a combination which is seldom replicated.
Buyers and sellers seem to be almost in balance as we end the year and if this is carried through to the first few months of 2011 it could well be a “movers market” where buyers will have a reasonable choice of properties and have the time to look rather than panic buy for fear prices will rise dramatically.
One notable trend in recent times has been the significant increase in “downsizing” buyers. They are selling large family homes and buying one or two smaller homes thus creating a new lifestyle of less property management, lockup and leave ability and also a further home, abroad in many cases. This completes the desire to free up their time and still enjoy quality living.
Properties at all levels are going to be price sensitive. In our view there are some regions and sectors of the market which could still see a drop of up to 10% in the coming year as a result of the austerity measures being taken while some Central London and prime country property is likely to rise by at least 5%.