Market report by Tim Waring
I suspect an increasing number of Yorkshire estate agents are being asked the inevitable question “ so how is the market at the moment?”
As we enter the first traditional autumn selling season post-Brexit, logic suggests that the question is more pertinent than ever. However is it? Maybe it rather depends who is asking the question.
For those who have bought and sold in the last 12 months, let’s call them “historic dealers”, the question is prompted by peace of mind. Did they do the right thing? Should they have waited? Have they paid too much or sold too cheap? How safe is the equity in the home they have recently bought? For many, the latter is the most important question as they consider their home to be part of their pension plans. To this sector of the market, I say “Deal done so move on”. However you feel, you cannot change the past.
We then have the “current dealers”, those who are in the market at the moment. While not all adopt the same strategy, there do seem to be some buyers who feel that post-Brexit, owners must be desperate to sell and willing to accept a major discount with offers that reflect this thinking.
The irony is that in making the proverbial “cash offer”, it then transpires that the buyer requires a mortgage as well, having the mistaken belief that their own equity plus monies from a lender makes them a cash buyer. They are then upset when the owner won’t accept the low offer, only to find further frustration when the same thing fails when they make another offer elsewhere. Further frustration ensues as it becomes apparent that there is also a general shortage of homes coming to the open market. So maybe the solution for current buyers is to accept the inevitable and offer a fair market price.
And what of current sellers? Well, you may well have told your agent that “we don’t need to sell of course” and use this as the justification for rejecting a good offer. The reality is often that you want a higher price, and you think that by playing hard to get, you will have your buyer offering more.
There may be a shortage of homes on the market at present, but buyers do have a choice and may think your price is just too much and they will go elsewhere. Ultimately, few buyers ever find their total dream house, so any purchase ends up being a compromise of many factors, including price. So maybe the solution for sellers is to remember the old adage that any property is only ever worth what someone is willing to pay.
Finally, we have “potential dealers”, those on either side of the fence who are contemplating entering the market. This may be by choice, necessity or opportunity. It appears that many potential sellers post-Brexit have held back amid speculation about how the housing market will enter a period of uncertainty with prices falling. Yet the reality thus far has been the opposite.
So have my “potential dealers” missed the boat. I don’t think so as I believe this autumn could prove to be a very active market and a good time to deal, both as a seller or a buyer.
As I have said before, when you trade in the same marketplace, the fundamental criteria for most is to achieve the price differential between your sale and purchase. This makes the whole transaction work. I fear some may have forgotten this fundamental point. If you fall into this category, you may care to reflect. And if you meet an estate agent this weekend, and ask “how is the market at the moment?”, do you fit into one of my three dealing categories or are you just being polite? *Tim Waring is a director of Dacre, Son and Hartley based at Dacres’ Harrogate office.