Jackson-Stops Market Review No. 49

How to buy when you have to sell, too.

Want to save carbon and money? Buy new.

Country Market Comment

HOW TO MOVE

The market is full of confidence and properties are selling fast. Yet many who are keen to move are sitting on their hands because, to buy the house they want, they must sell. How can they compete with buyers who don’t have to?

Intense demand in the middle and upper country house markets has out-lasted the stamp duty holiday, lockdowns and winter. Volumes have only slowed because of a lack of supply. This makes it even more of a sellers’ market and thus even more frustrating for the legion of would-be home movers, waiting for a market not dominated by buyers without a dependent sale. Waiting, though, is not in their best interests.

A CO-OPERATIVE ENDEAVOUR

Selling in order to buy, is always something of a dance. As both a seller and a buyer, the market can only ever be partially in your favour, so holding out for the perfect time rarely makes sense, even before factoring in the unpredictable preferences of whoever you sell to, and buy from. It is, though, a co-operative dance: all involved want to trade, so a fund of goodwill is there. Create enough flexibility, and your offer might be more attractive to a seller than that of, say, the cash buyer who wants possession by the end of the month. Indeed, looking at feedback from our offices around the country, it’s clear that the majority of sales do still involve buyers who themselves have related sales. How do they do it? Here are the essentials:

1. Get real about your move

A clear plan will reveal how realistic your expectations are and any steps – such as checks on property title and eligibility for finance – that must be taken along the way. Being well prepared encourages buyer

Country Market Comment

interest, helping to attract competing bids and thus the best buyer for your circumstances. It’s also hard to overstate just how important it is to choose a good conveyancer: more sales than ever are failing, or taking literally months longer than expected, because of legal service delays.

2. Get a buyer

Without a buyer, you can’t buy, and no seller (or agent) will take your interest in a house, seriously. Ideally, you want a buyer willing to pay a top price and fit in with your timing. Right now, your chances of this are good, because it’s a seller’s market.

3. Get flexible

There are two main ways to do this. The simplest is to sell first and move to a rented house with a flexible term (see next article). If – like most – you regard renting as possible but unattractive, the next best thing is to have exchanged contracts with your buyer, with a delayed completion. ‘Completion in six months or less by mutual agreement’, has proved a winning formula with many of our country house deals. It gives your buyer certainty, whilst putting you in just as strong a position as most buyers in rented accommodation. If exchanging contracts without a purchase is also a step too far, do not despair. Sellers will take your offer very seriously, if your lawyers can confirm that your sale is 100% ready to exchange, and your timing fits with theirs. Of course, you might need to offer a little more.

Below left: Cornwall £2,750,000 guide (Truro)

Below right: Cambridgeshire £995,000 guide (Newmarket)

Above right top: Surrey £1,175,000 guide (Dorking)

Above

TIME TO MOVE TO TOWN?

Overall prices are still rising, but not by as much. This is how markets work: they are cyclical. Over time, capital growth is remarkably similar, nationwide. Regional and property-type cycles do differ in their timing, though. If you are lucky, you can move when the house you sell is at the top of its cycle and the one you want to buy, is at the bottom. Right now, for example, the differential between a more rural country house with an acre or two and, say, a two bedroom house in Wimbledon, or a flat in Pimlico, has rarely been smaller. For rural downsizers looking to move to the city, the timing must be close to ideal.

ANNEXES WANTED FOR WORK, FAMILY AND INCOME

Recent changes in lifestyles have not all been about the pandemic. Technology had already been making working from an office at home quite normal. Adult children have been living

at the parental home for longer, making separate space vital for many, and Airbnb has created a financially attractive, accessible tourism market. A good annexe, or converted outhouse, facilitates all of these things. Demand is thus high, so it’s worth exploring the potential for creating such a space, if your property does not already have it.

WHAT TO DO WITH LAND

Our offices have seen a huge increase – more than 60% – in the volume of more expensive country house sales, many of which have far more land than their new owners have ever enjoyed. Some of these are shown on these pages. Buyers often worry about their lack of experience: “I’ve never had more than a roof terrace”. Others query the benefits of owning land they won’t personally use. In practice, maintenance tends to be easy (productive land is in demand and can always be rented out) whilst the key benefit of ownership is arguably the greatest one of all: control.

Above left: West Sussex £1,750,000 guide (Midhurst)

right bottom: Surrey £1,750,000 guide; 1.5 acres (Woking)

Above: Devon £2,500,000 guide; 167 acres (Taunton)

Far left: Hants/Wilts border £1,695,000 guide; 1.2 acres (Winchester)

Left: Yorkshire £1,500,000 guide; 2 acres (Harrogate)

Bottom: Gloucestershire £1,750,000 guide; 5 acres (Chipping Campden)

NEW LIFE LANDLORDS

Recent times have seen many owners use the rental market as a means to try new lives in the country – and out of the country.

The big demand for country rentals right now is from those who have sold and want to rent, before they buy. For landlords, this presents a dilemma. Far from being long-term and predictable, such tenants want to rent for as short a time as possible, yet minimise the chances of having to leave, before they are ready. Reconciling these aims is not easy: few landlords will agree to less than a year. A significant number have, though, been tempted by a six month tenancy, after which the tenant must give notice of one month, and the landlord, two months. The price for such flexibility is high: a premium of as much as 20% on rents which are already up at least 10%, on a year ago.

NEW LIVES

Covid restrictions prompted major re-evaluations. Early on, they generated a wave of country lettings to families who were, in turn, renting out their city home. Last year, came another wave, this time of owners who quit their jobs, let the house – and left the country. They were leaving not for a career

abroad, but its antithesis. They left for a new life: to sail around the world, live and study in Sicily, and to live and work (remotely) in the Alps, to take just three examples. They might be gone for a year or two, or longer. Renting provides funds and flexibility. This year, we are welcoming the return of an important source of high quality houses to rent: owners who have accepted a post abroad, typically for three years.

WHY SO MANY QUESTIONS?

A reliable tenant is crucial, especially for landlords living abroad. Reliability is as much about the house and location being right for you, as your financial stability. The right house is one that you will care about and be reluctant to leave. Unlike a sale, there is a longterm relationship involved. Consequently, we ask prospective tenants detailed questions about their daily lives, finances and intentions. These can seem intrusive at the time but, for tenants as well as landlords, the rewards – a good, reliable home and a good, reliable income – reveal themselves on a daily basis, often for years.

Above: Kent £2,500pcm (Cranbrook)

Below: Northamptonshire £1,650pcm (Northampton)

SOLD!

Over the last, quite extraordinary twelve months or so, our offices across the country have sold more houses than at any previous time. This is a tiny selection of some of the more eye-catching examples.

Left: Dorset £2,000,000 guide (Blandford Forum)

Above left:Cheshire £1,350,000 guide (Chester)

Above right: Surrey £2,750,000 guide (Reigate)

Left: Essex £2,995,000 guide (Chelmsford)

This page, clockwise, from right:

Devon excess

£1,700,000 guide (Exeter)

Yorkshire £1,100,000 guide (Harrogate)

Kent £1,100,000 guide (Sevenoaks)

Gloucestershire

£1,950,000 guide (Chipping Campden)

Norfolk £2,500,000 guide (Burnham Market)

Bedfordshire

£5,000,000 guide (Woburn)

London Market Comment

ACTIVITY FUELS ACTIVITY

The extraordinarily busy London market of last year (our most successful ever) has been gathering even greater pace in 2022. Supply is healthy and demand, having been unevenly spread, is now uniformly strong – partly because flats are offering such good value.

Left: Sutherland Street SW1 £3,350,000 guide (Pimlico)

Our recent central London deals include competitive bids for both a £4 million house in Pimlico and a £335,000 studio in Westminster. That properties of these kinds – both outside the much larger mainstream two bedroom flat and three bedroom house markets – should command such great interest, is an indication of just how active the market has been, across the board. Confidence in sales and lettings values has really helped this, as has the impressive performance of the City.

WHEN THE CITY DOES WELL...

...London property does well. This is often said, because it's true. London has lost its crown to Amsterdam as the biggest share trading centre, but margins on such trades are slim. The big fees (and bonuses) are generated in sectors such as private equity and hedge funds, which are booming, and in M&A activity which had

its best ever year in 2021. Not to be out-done, the London Stock Exchange raised more from new listings than Europe’s two largest bourses combined and London tech sector employment grew to a new high. Indeed, competition for staff in the City’s tech, legal and financial sectors is increasingly fierce, forcing up salaries. Combined with the emergence of a clear preference amongst many leading businesses in those sectors for a post-lockdown return to full-time, in-person attendance, it is little wonder that London property is doing so well *

BOOMERANG BUYERS (AND TENANTS)

Famously, the Covid lockdowns did persuade a number of London owners to sell up and move to the country. Some relished the experience. Others realised that rural life is not

Above: Laleham TW18 £2,150,000 guide (Weybridge)

*Sources: City of London/PwC; FT; ONS; City AM.

for them after all, prompting either a simple return, or the adoption of a ‘hybrid’ lifestyle. Those in the latter group want a small second home, as centrally placed as possible. Some have opted to rent. Others, attracted by the relative value of smaller properties, want to buy –hence the competition for the studio flat referred to above.

APARTMENT VALUES ATTRACT LANDLORDS, TOO

Price growth for flats has lagged behind that of houses which, for detached properties in areas such as Weybridge, has been as high as 20% over the last year. This is at least three times the price growth seen for flats. As a result, even after bouncing back to above pre-lockdown prices, London flats, especially in central areas, look like an even better bet than usual. This value – and rising rents – has produced two welcome sources of supply to the rental market, just when needed (supply has been

tightening). The first is professional landlords, who have returned to the market with some force. The second is the retention, within the long-term rental market, of former holiday lets. The owners of these properties came to us when the holiday market abruptly ceased to exist. Now that it is recovering, we are delighted to report that the majority of those owners, having experienced how much easier life is with long-term, reliable tenants, are sticking with us.

LOOKING AHEAD

The nature of property is that a fluid market makes moving easier, encouraging still more people to move: activity fuels activity. Despite some negatives regarding general inflation and interest rates (though see Private Finance, page 19) London’s economy looks so healthy that we expect lettings and sales activity to continue to be high. Movement in both capital values and rents will be upward – markedly so in central London.

Right: Somerset Rd SW19 £6,950pcm guide (Wimbledon)

Far right & below: Pottery Lane W11 £6,912pcm guide (Holland Park)

THE FREEDOM TO DESIGN FROM SCRATCH

With premises in many of the same areas as Jackson-Stops, Susie Watson Designs also shares our commitment to the physical high street, to country styles and exceptional quality, coupled with the most modern and convenient ways of working.

As part of a new partnership with Susie Watson Designs, we have exclusive offers available to Jackson-Stops clients. Please ask for details at any of our offices.

Why not drop into one of our ten nationwide showrooms or call our Interior Designs team to make an appointment on 0844 980 8185.

www.susiewatsondesigns.co.uk

VISIT A SHOWROOM:

Alresford | Chichester

Harrogate | Knutsford

Marlborough | Marlow

Saffron Walden | Salcombe

Sherborne | Tunbridge Wells

Chances are you have quite a lot of furniture you still love and possibly some antique pieces as well. Our beautiful handmade furniture will look as if it belongs from the day it arrives; the lovely, weathered finish is a pale honey colour which will sit happily with darker woods and antiques. It comes in a wonderful selection of designs and classic shapes and sizes. For chairs and sofas, you can choose from our stunning range of natural wools, linens and cottons and beds are often covered with bespoke embroidery to make them extra special.

“The great advantage of handmade furniture,” explains Susie, “is the ability to customise it if required. Our workshops are small, and whilst we don’t have the capacity to mass

produce, it means we do have the ability to work with customers to get exactly what they want.”

Perhaps you’re looking for a dining room table in a particular size or a set of chairs upholstered in a particular fabric. Or perhaps you are looking for made-to-measure curtains and matching headboard in your bedroom. Buying bespoke is all about allowing you to choose things that will not only fit the dimensions of your room but also suit your style.

This is where our design teams are on hand to help. “Sometimes, a customer will know exactly what they want says Rachel our head interior designer. “Other times, they are still deciding and find it useful to browse through our photo library to get ideas.

When it comes to furniture, the old adage “one size fits all” simply doesn’t apply. Homes come in all shapes and sizes and it can be hard to find exactly what you’re looking for.

Our designers are there to help throughout this process, from an initial showroom consultation or phone call to the home visit.”

We use sustainably sourced hardwoods, which are hand-carved in our small studio-style factories. The advantage of being a small, family run business is that we are intimately involved in the whole process, communicating with our artisans on every detail during the design process, from the overall shape and dimensions, right down to the carvings on a chair leg.

“I like to think it means something to our customers, to know that their kitchen dresser has been carved by hand, specifically for them,’ says Susie.

“Our society has become so accustomed to machine-made products, that we sometimes forget to appreciate the effort, time and skill involved in making something by hand. I really feel that this understanding helps us to enjoy them more.”

There is a common assumption that anything bespoke will be wildly unaffordable and take months and months to produce, but this is not the case. “Typical lead times for bespoke items is 8-12 weeks. and we try to be as transparent as we can with pricing, whilst still giving our customers as much choice as possible.”

New Homes & Developments

TURNING UP THE HEAT

Energy costs, boiler bans and environmental responsibility are highlighting a major asset of new homes: they can cost up to 90% less to heat. Some do.

Left: Felixstowe, Suffolk £1,750,000 guide (Ipswich)

Any property being sold* must have an energy performance certificate and rating, from A (the most efficient and least costly) to G. The difference in running costs, grabs attention: fuel bills for a B rated property will be roughly half those of its D rated equivalent. An A rated house can cost half as much again – often even less†. At a time when ‘working from home’ often means ‘heating on all day’, this matters. Yet, last year, only 4% of existing (i.e. not new) properties were rated A or B, compared with 85% of new homes. Super-eco, A-rated properties – almost all from smaller, niche builders – saw unprecedented demand. Mainstream housebuilders are taking notice.

"COULD HAVE SOLD THEM SIX TIMES OVER"

‘The Bec’, an A-rated Newbourne Homes development of nine apartments in London SW16, is a brilliant example. It uses air source heat pumps, underfloor heating and mechanical ventilation to maintain even interior temperatures and supply constant fresh air, via carbon filters which remove pollen and pollutants (VOCs). It also controls moisture levels to prevent condensation and captures up

to 95% of waste heat. Each parking space has a charging point, every home has two bike stores and the communal lighting, is solar powered. To cope with heavy rainfall, paths are permeable and rain water drains into an underground tank. Energy costs are likely to be 90% less than for period properties of a similar size. Buyers love them. All apartments sold within a few days of the off-plan launch since when, says Anna Truman of our New Homes team, “We could have sold them all again, at least six times over”.

WHO ELSE IS BUILDING TO THIS STANDARD?

In Exeter, Heritage Homes has been committed to the A rate standard for many years. Their 82 home development ‘The Green’, is soldout thanks to both universal A-ratings and an impressive mix of contemporary designs. Their new development, Rosebanks, a few miles to the north of Exeter, takes the concept further. All-electric (The Green has gas boilers) with air source heat pumps, underfloor heating and solar panels, buyers can have additional solar panels and a Tesla ‘Powerwall’ storage unit.

* Listed buildings usually exempt. † Home Builders Federation/ New-homes.co.uk

Above: The Bec London SW16, from £599,950 guide (Weybridge)

BOILER BAN

As Heritage Homes have demonstrated, gas boilers can be extremely efficient. The Bosch boilers can even, with the change of a single part, switch to burn hydrogen gas, instead. Without that switch, however, their fuel will always be a fossil fuel. From 2025, gas boilers are banned from new homes. From 2035, it will be illegal to replace your existing natural gas boiler, with a new one. This is forcing mainstream housebuilders to go all-electric, a move which should enlarge the market for A-rate technologies and reduce their cost. Cost remains the key reason why only 2% of new homes registered last year were A rated; 15% fell below B. Hopefully, the hugely positive experiences of the developers and customers highlighted here, will encourage the rest.

POST-PANDEMIC PERKS FOR THE PEOPLE

Think low rates are on the way out? Think again. Ahead of the latest base rate rise, Virgin Money announced a 10 year fixed 1.89% loan, almost immediately undercut by Halifax (1.68%) and Lloyds (1.66%). Even as base rates and the absolute lowest rates creep up, rates for more typical borrowers, are coming down. A year ago for example, a couple earning £60,000 between them and looking for a 90% mortgage on a £300,000 property would have had to lock-in for two years at around 3.5%, if they could find a lender at all. Today, they would have a good choice of products and should pay 1.9% at most. The picture is similarly more benign for the self-employed and for landlords (see below). This broad shift shows greater lender confidence in underlying values, in their own resilience, in the consequences of the pandemic, and in their ability to interpret earnings made, during it.

BTL PRODUCTS FOR LIMITED COMPANY & PORTFOLIO MARKET

Normally highly conservative, this market continues to defy its stereotype, with many loans of under 3% on offer and lots of innovative, limited-edition products. These include one fixed for two years at, incredibly, 0.99%, again emphasising the relaxed attitude of the money markets about future interest rates. BTL rates have come down because this sector has proved reliable – and thus profitable and attractive – for lenders. If landlords are enjoying lower rates now it is because, collectively, they have earned it.

REMORTGAGORS FIXING SIX MONTHS AHEAD

Despite the observations made above, increasing base rates are pushing borrowers approaching the end of a fixed rate term to get their enquiries in early. This is worth doing: having got approval, most lenders will lock in your new rate, six months before the loan is granted. So if you need to re-fix in less than a year, it's worth putting out the initial feelers, now.

For independent advice, contact Private Finance on 0870 600 1650 or jackson-stops@privatefinance.co.uk.

www.privatefinance.co.uk

Above: Wilmslow £1,300,000 guide (Alderley Edge)

Right: Westcott, Surrey £625,000 guide (Dorking)

Below: Rosebanks, Devon from £499,950 guide (Exeter)

Hugo Spowers is a British engineer and the founder of Riversimple, which manufactures the Rasa, a road-approved hydrogen fuel cell electric car. A small fleet of Rasa cars are currently being tested by private drivers, car clubs and Monmouthshire County Council, in and around Abergavenny in South Wales. www.riversimple.com

WHERE KIDS CAN DRAW ON THE WALLS

by Hugo Spowers

Home is a rather dog-eared Herefordshire farmhouse near Offa’s Dyke and the Welsh Border. There is a small town nearby, but no railway station. The roads are narrow and quiet, disturbed most often by the occasional tractor. We came to this inaccessible corner of England because, unlike everywhere else which also felt like a good place to raise our children, here we could afford the kind of house and garden we wanted.

The house is not fancy. We never worried much if the kids traipsed through in muddy boots and drew on the walls. But it was and is a brilliant home. Our respective childhood homes are now mostly under the M3. There, as here, we relished the freedom to get everyone together, build dens, get stung by nettles, lie peacefully in long grass in the sun and on rainy, grumpy days, to hide away beyond earshot. Yet to still be at home. We moved here about 20 years ago. It was rare, then, for a couple who did not work in agriculture, to be able to live somewhere so remote. We were fortunate: it coincided with the rise of the

internet. My wife’s job at the time took her out of the country a great deal, but when she was in the UK, she could be here, so we were both able to work remotely before it was so widely accepted. Those who live here tend to work here; it's too remote for commuting. So the community around the town relies upon it for shopping, socialising and all sorts of arts shows and events. We like this. It creates a mass of links between people and a depth of connection which seems, across our ultra-connected world, to be increasingly rare. It’s the sort of place to which young writers in the 1970s escaped, enriching the community. Today’s urbane, urban commentators would probably look down their noses at our rambling house and its lack of ‘statement’ pieces and bling. No matter. We love feeling so at home, everywhere in and around our home. As a bonus, it also turns out that the small, nippy car we designed for cities, is as practical in country lanes as in double-parked city streets, and as much fun when overtaking a tractor, as when pulling out into Hyde Park Corner.

PROPERTY EXPERTS SINCE 1910