Bruce de Wert
Good news all round, I am glad to say.
Looking back at 2014, at the beginning of last year we were still expecting, by way of offers, between 5 and 10% less than the Home Report valuation. In other words, prices were still going down.
By the end of the year, however, we were managing to obtain, from buyers, the valuation price. Many were still trying to offer less than the asking but, in general, we were able to resist that. Prices had stabilised, at last!
Not shockingly good like the centre of London (which has subsequently fallen back) but, for Caithness and Sutherland, pretty good news, the likes of which we have not been seeing since the crash of 2008.
Since I opened my office in Tain in April 2014, we have also been able to see how things are going that little bit further south. It seemed the further south you go, the better the news. In that area, prices being achieved are mostly in excess of valuation.
What is, also, heartening is the volume of sales. In 2014, we sold twice as much, in value terms, as we did in 2012.
In general, one can say that town properties are selling much more easily than those in the country.
The financial spread of sales is quite interesting. We sold a great deal more lower value properties. This accords with a rise in demand for buy to lets. When your money is making 1% at the Bank, you are going to look for alternatives and many people, with spare cash, turned to the property market.
Also, if there are scary situations on the horizon, you look for a safe haven. One such scary moment was the Referendum. It was clear that some people were ploughing their money into buy to lets as a safe haven for their money, in case we ended up with the Euro or a Scottish merk or pun.
Conversely, however, another result was that other people were holding back from moving because they did not know what a Yes vote would bring. This is not speculation. This is what people told us at the time when we asked why they were not going ahead. The insecurity was palpable.
Happily, though, after the Referendum result, the floodgates opened and everything went back to normal. One could speculate as to what would have happened if it had been a Yes but I am not going to. As an Estate Agent, I am only happy that the result was continued increases in numbers of sales and higher prices.
Sadly, the demand remains from locals. The English have still not returned in numbers.
And as for 2015, it has been full steam ahead. One might think that this time of year people would be huddling round the fire but this is not the case. We have had a record number of offers, already, which bodes well for the rest of the year.
As an Estate Agent, it is, of course, a temptation to talk up the market but anyone who has read my property pieces before will know that I tend to tell it how it is.
Therefore, I have to say that there are some risks ahead. First, the election. The economy has been powering ahead under the present leadership and wages, at last, are increasing more quickly than prices. We are, at last, individually getting richer although, sometimes, it is difficult to believe it. There is a lot more confidence in the air.
This election is different from previous elections. It is no longer a straight choice between Labour or Conservative. The speculation is that whatever the make-up of the next Government it is quite likely to be a coalition but no one can say who will be in it. Will the new Government continue the same economic policies? What will happen to the economy? Insecurity is always a problem for any market and the housing market is no different.
Perhaps, however, the economic fallout not be felt in 2015. They are longer term consequences as will be the result of the Scottish Government receiving more fiscal powers.
They have made their intentions clear-more tax and more spending and their first alterations to tax our already in place with Stamp Duty arrangements which taking effect in April. Whilst the overall result will be a much larger Stamp Duty for Scottish taxpayers, we, here in the North, are in the happy position of being net beneficiaries of the policy.
For instance, if, today, you purchase a house, costing £150,000, you will pay £500 Stamp Duty. After April, you will pay £300, saving £200. It is only when you reach £254,000 that you will be paying more. Sadly or happily, whichever way you want to look at it, there are fewer houses in that bracket being sold in the North. Happy days for us! Stop press. The Scottish government has indicated that they are going to reduce the Stamp Duty tax previously announced. We shall see but I do not think it will affect us much.
A very brief word about Greece. You might not think that events in Greece could affect you but, by the time you read this, their election result will have been announced.
The left-wing Syriza party is said to be poised for victory and they have indicated that they will reject austerity and effectively, renege on the national debt accumulated in earlier spending sprees. They may be ejected from the Euro. If they go, many pundits, including the Guardian newspaper, speculate on a Euro crisis. I do not think we are back to 2012 but Europe will not be a happy place and we have most of our trade there. We shall see.
Having said all that, I have a nice warm feeling about 2015.
I think that: –
- It will become easier to sell your home in 2015
- Prices will start to rise!
Happy New Year!