Britain has a long tradition of property ownership, and in these unstable times, investing in bricks and mortar seems more sensible than ever. But as we experience another consecutive month of house-price falls, what is actually selling and what is being left on the shelf?
Gone are the days of broom cupboards in Chelsea selling for £170,000, and the consensus is that we’re all better off for it. Liam Bailey from Knight Frank agrees: ‘What we’re witnessing is a “flight to quality.” A classic Georgian rectory in the right area will sell, but if there’s anything blighting the house, then it will be much harder to find a buyer.’
Tom Hudson from buying agents Middleton Advisers says perfect properties priced accordingly are in demand. ‘There’s still a rich seam of buyers who want to move from London to the country. They’ve got their children into schools, and now they’re looking for the right house—and they might only have two or three to choose from.’ Competition is healthy for the perfect property, as there’s less on the market, and the deciding factor is location.
‘A country house in or on the edge of a village, with good views, transport links and complete privacy, is still the main requirement, and will always be the most intelligent investment in the long term.’ Mr Hudsons’s buyers aren’t even looking for a property in perfect condition—most have already budgeted to do work once they move in: ‘The bottom line is you can change a house, but you can’t change its location.’
Buyers are also looking for simplicity. Properties that were upgraded by previous owners in the interests of climbing the property ladder may not appeal. As Dawn Carritt from Jackson-Stops & Staff points out, buyers are steering away from properties good communications and a mile of fishing on the River Test won’t be long on the market, but aircraft noise, pylons, public rights of way and road noise will all count against any property regardless of its grandeur.
New-build houses in the Home Counties (Russian buyers notwithstanding) are also suffering from the evaporation of their natural market of City workers.
Prime Central London has seen price falls, but flats in the best addresses are achieving their guide price. Modern and spacious properties in Knightsbridge and riverside locations are selling fast, but basement flats without gardens are struggling.
‘In London, if you’re above with extra bells and whistles. Land prices are starting to drop and, unless there’s good investment potential, extra paddocks, all-weather tennis courts, extensions and heated outdoor pools are seen as unnecessary next to family properties in good areas.
The quest for simplicity has led to concerned commuters forgoing the London pied-à-terre. This run of second homes coming onto estate agents’ books also applies to the West Country, where houses near the coast are holding their value, but other less well positioned houses won’t achieve the heady prices quoted earlier this year. But it does mean that more realistically priced houses will find buyers, which will have a buoying effect on the market.
Another issue which agents expect to support house prices in the long term is the limited availability of good properties, particularly in the South-East, but Savills research found quality holding its value throughout the country market. Estates in Hampshire with good communications and a mile of fishing on the River Test won’t be long on the market, but aircraft noise, pylons, public rights of way and road noise will all count against any property regardless of its grandeur.
New-build houses in the Home Counties (Russian buyers notwithstanding) are also suffering from the evaporation of their natural market of City workers.
Prime Central London has seen price falls, but flats in the best addresses are achieving their guide price. Modern and spacious properties in Knightsbridge and riverside locations are selling fast, but basement flats without gardens are struggling.
‘In London, if you’re above a noisy bar or in a damp basement, your property is likely to be overlooked,’ Mr Bailey agrees, although rents in the capital remain healthy, so owners may wish to lease such properties until the market readjusts.
Most agents are predicting a total fall from peak to trough of 25% –30%, and a complete recovery to December 2007 prices in about 2015, but the one fact that unites all those involved in the property market is that you can’t argue with quality. Quick cash won’t be made over the next couple of years, but a sound investment in a classic country house is something that others will value both now and in the future.
