the property market 2013 Words | Tim Groves, Black Grace Cowley Telephone: 01624 645555 | t.groves@blackgracecowley.com www.blackgracecowley.com
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t’s that time of year again when the seasonal frenzy starts in earnest, lights and decorations adorn almost every shop and Estate Agents review the year’s sales performance and try to look forward to the next year. So what does the future hold for our market in 2013?
Whilst the news for most homeowners in the UK is fairly bleak with another anaemic year forecast, we hold a marginally positive outlook for the local market, however, it still doesn’t resemble the fully functioning market that we were all use to pre-2007. That said, we’re not expecting house price growth in 2013; prices have been fairly flat since 2009 with any modest gains from pre-financial crises being ironed out as prospective purchasers adopt a ‘sit and wait’ stance. The main reason for this is the contraction in the mortgage market which has led to far fewer transaction levels.
Those wishing to sell have to price their properties sensibly having given thorough consideration and thought to the presentation and price advice the agent provides in what are very competitive market conditions. Low interest rates have been holding prices up and the almost full-employment conditions on the Isle of Man also helps reduce the economic pressures unemployment and high-interest rates place on house prices. That said I believe that conditions in the mortgage market are perhaps not in a post crisis blip, but will come to be viewed as a ‘normal’ market where lenders criteria for loan approvals
adopts a more risk averse approach, especially after an extended period of loose lending across the sector. Activity in the UK housing market is showing signs of forward movement in terms of mortgages advanced with the number of home sales rising by 9% in the first nine months of the year compared to the same period in 2011. Many commentators have suggested that lending could pick up further as the Funding for Lending scheme gathers pace. This makes £60bn available for banks to borrow in the first phase of the scheme, which began on 1 August, which in turn can be lent to householders. So whilst we remain cautious locally about house prices we envisage steady and consistent returns for ‘buy to let’ investors over the coming 12-18 months as young people still find it difficult to get onto the housing ladder and other prospective buyers continue to watch from the sidelines.