As a rule, John Thorogood resists the urge to predict the market. But six months ago, when I last wrote for The Word, I noted that we needn’t look any further afield than stamp duty as the main factor keeping a lid on prices. I argued that, contrary to public opinion, it was a better time to upsize in the capital than it had been for some time. One or two eyebrows were raised. But now statistics are emerging to back up my theory. I could say “I hate to say I told you so”, but that would be a little white lie. And honesty, or giving honest advice – even when it flies in the face of a popular viewpoint – has always been the John Thorogood way.
In any case, perhaps I could be forgiven a little professional satisfaction when I read this week’s industry headlines. Data now confirms that slower house price growth over the past two years (especially for London’s high-value property) may have offset extra stamp duty charges. In short, you pay less overall to buy a bigger property then you did before, as prices have come down by more than stamp duty has gone up. Eureka! So, with mortgage rates attractively low (even on a five-year fixed) and the affordability of property at its highest for many years, what is (or was) holding buyers back? A reluctance to pay the taxman? Do buyers really care whether they pay a vendor, as part of a rising purchase price, or the Government in the form of tax? Some do, yes but we sense the tide is turning…
Between and around the commons, stamp duty has well and truly bed itself into prices. It takes a while for that to happen, particularly when the market is confronted with changes as significant as those introduced in December 2014. But 30 months is ample in my opinion; and with those 30 months comes pent-up demand, especially with spring in full swing. Stamp duty won’t stop people needing to move, although it may make them search more carefully, so we have many qualified buyers quietly waiting in the wings for the right property to come up.
We’re finding vendors are reacting too. Keen for their homes not to be over-exposed in what some describe as an uncertain market, many are returning to old-fashioned methods of discreet, word-of-mouth, off-market selling to ensure privacy, the best price and the appropriate “serious” buyers.
In essence, neither party wants their time wasted. So, where or to whom do they turn for that? Not to Rightmove or Zoopla I assure you (where the world knows your inside-leg measurement); but to an experienced local agent who understands buyers’ requirements, has unparalleled knowledge of the area’s housing stock and a long list of established relationships. The larger houses in our area, despite what multi-office agents try telling you, most frequently sell to local buyers we know, who’ve had their eye on a location for a while – in some cases, years.
Any agent can list properties online but matching the right people to them is what we do best. This kind of inconspicuous sale is gaining in popularity and even as I write, John Thorogood are concluding the sale of three houses that never needed to appear on the open market at all, one of them at a record price for the street. Perhaps we do have something to thank Mr. Osborne for after all…