MARKET UPDATE

PUTNEY PROPERTY MATTERS

Despite all fears expressed about 2011 it has, for our company, been a very successful year. I am delighted to say that our sales, lettings, and property management departments have all been extremely busy and have produced excellent results for our clients.

SALES

At the beginning of the year media predictions were full of foreboding, tales of market crash, lack of finance and all the usual dire consequences of recession. The reality has been that London, and especially the most popular areas such as ours, has not only survived but has seen strong demand, an increase in the amount of property sold and a rise in values.

However it must be born in mind that this is certainly not countrywide, other areas are quite depressed and where the effects of the current economic situation are hard felt, naturally property suffers. In Britain, London is almost a separate economy, where despite everything the market is still strong, it is often forgotten that London has the largest economy of any city in Europe and is even far bigger than many individual countries.

One factor that has ensured residential property has not suffered in the way it did in the recession of the early 1990’s is that interest rates are at record low levels, so mortgage repayments for existing home owners have been affordable and thankfully repossession levels have remained very low. For first time buyers looking toward their first step onto the property ladder, mortgages have been a little easier to obtain too, certainly in the latter part of the year.

With high demand comes low supply! Supply of property has been consistently below normal levels because naturally a substantial number of people prefer to consolidate rather than take on greater commitments in uncertain times.

Much has been made of a change in desire in the UK to own our own home. This is an argument I have heard at various times in my career. Frankly it is as daft now as it ever was. For sure the age of the average first time buyer has increased due to a variety of reasons; saving for a deposit is difficult, people enter long term relationships later and certainly have children later. The desire to own your own home is still utmost in the ambition of most people, it is almost inbred in us, few if any want to rent for ever, it is also interesting to see that among immigrant populations it is also an extremely strong aspiration.

2012 will continue to be a difficult year for the economy, the problems for the Euro Zone and the USA need no further analysis from me but the effects will be felt for a long time. The recovery in the UK is dependent on the world situation, however it is easy to be induced in to a fear syndrome by the media, life does go on and it is not always as bad as they predict, remember how the world was due to end because of the millennium bug!

It seems incredible but in 2012 it will be 5 years since Northern Rock hit the headlines for all the wrong reasons, the rest as they say is history, but we are still here and for us the market has recovered. We may not be in boom times but my prediction is that despite everything, the stability of the property market in our area will continue.

LETTINGS

2011 has for us been our best year ever, our dedicated team has been successfully letting more property and our management portfolio continues to grow, it seems that a greater number of clients than ever appreciate using a company that is locally based and able to react quickly to any eventuality.

The market has been exceptional, rents have risen by an average of 10%, and such is the demand to live locally. Some of this is because people are buying later in life, so therefore renting for longer. Putney has a massive and growing number of flats and its popularity is assured by its brilliant communications and amenities of the river and being surrounded by so much greenery. Putney’s desire as a place to live is assured, it is also interesting to us that most tenants prefer to stay local when the time comes to buy.

If tenants are having to pay increased rents then landlords have to realise that they demand and deserve good quality accommodation, as a company we are strict with what property we take on, we refuse anything sub-standard, or where we know landlords are reluctant to carry out repairs. We want tenants to be happy, so fair landlords find their properties are respected and its win-win for all.

BUY TO LET

Is investing in property still wise? Well, you would not expect me to say no would you?!

Seriously though I still firmly believe that property is about the safest long term investment you can make. Buy to Let mortgages are available, and if you buy sensibly and have well-presented property to offer to tenants there is no reason why your property should not be let successfully. There are a host of points to consider when buying for investment and we are always happy to advise as to what would be best for you to consider.

As we have been around for nearly 30 years we have unrivalled experience of the local market, even if you are not buying through us for an honest opinion check let-ability and likely rental value. There is no road or block in Putney that I do not have experience of!

Just like buying your own home to live in, if you buy for investment a repayment mortgage can be a brilliant long term decision, it is to my mind like a life assurance policy but with someone else paying the premium, i.e. the tenant!  As retirement approaches you have paid off the mortgage and apart from expenses, and I have to admit tax, the rest is all yours and you have all the capital value, again tax I am afraid if you do sell but tax is only on profit!

CONCLUSION

In the UK we have an in-built belief in the solid value of bricks and mortar, but however you analyse the logic it is hard to fault. We live on a small island, with a large and growing population and we all need somewhere to live, regrettably in recent years new construction has been at depressingly low levels, in time that may change, but the firm foundations of a solid dependable market will remain just as it has in the past, the finest long term decision that the vast majority of us will ever make.

So if you are thinking of doing anything related to property in or around the Putney area don’t hesitate to get in touch.

Our team leaders are; Stuart Nickloes for lettings, Kate Cooper for sales and Susan Martindale for Property Management, and I am always around to advise or assist,  why not drop  in for a friendly chat sometime to discuss your property matters?

Allan Fuller