The Southern Property Divide: Selling vs. Buying
Sticking with the trend of the previous two quarters, buyer interest in properties for sale continues to outweigh the actual stock available. As a consequence, sellers continue to have the power, and this has led to a slight increase in house prices year on year. However, the property equilibrium for the southern UK market may change within the next six months, and therefore sellers are advised to take advantage of the favourable conditions of the property market at present.
With a general economic background of decreasing interest rates and undoubtedly more flexible lending conditions than a year ago, buyer power is look set to increase over the coming months, corroborating the idea that the southern UK property market is not only recovering, but looking set to flourish for the new decade.
However, the picture is very different, for the rental market in the south of the UK with less availability of property for rent. There has been a shift in lettings market conditions, with less and less houses and apartments available for rent. Nationally, there has been almost a 25% decrease in rental stock levels, with Home Counties near the London commuter-belt experiencing almost 50% decreases since this time last year. Rental management has become increasingly more fragile, with severe choice limitations for prospective renters. Landlords have so far wrongly assumed that this might drive up rents, but with tenants unwilling to pay over the top, properties for rent with too high a price are not faring so well.
This problem has been heightened by the fact that there has been an unexpected rise in the number of landlords and tenants agreeing to tenancy extensions, frustrating potential property purchasers who are now finding it difficult to identify their next buying opportunity. As a consequence these people are now holding on to their tenancies for longer periods of time, and contracting the rental supply stock further.
Article written by Hamptons International.
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