Market Review Newsletter (Balham, Battersea and Clapham)
Mon 11 Apr 2011
By Liza-Jane Kelly, Sales Director
The south west London property market has had a great start to 2011, once again characterised by a lack of supply. This has allowed Marsh & Parsons to achieve some outstanding results, especially in the family house market, where the demand appears to be insatiable.
Interestingly, in both our Clapham and Battersea offices we have 16 potential buyers registered for every available property, whereas in Balham, with slightly more supply, this stands at 10. The recent Budget did little to help the average person in London and the continuing use of Stamp Duty as such a blunt tax-raising instrument with such defined price bandings, is unduly onerous on Londoners.
With this demand in mind, estate agents are valuing aggressively (its our job to get our clients the most amount of money after all) however, some agents, driven by desperation with nothing to sell, are giving poor advice. Theres ambitious and then theres crazy! Incorrectly priced property simply wont sell.
Bonus money is just starting to enter the market, albeit much more subtly than in previous years. South west London is always hugely popular with the city buyers who, with large cash deposits waiting on the sidelines, are ready to enter the market when the right house comes along. It is also an increasingly popular area with foreign buyers (mostly European) who have been particularly active in the market so far this year.
In summary, the spring market is upon us and unless more people take the plunge and trade up (or down) in the next few months, thereby bringing more stock to the market, prices will inevitably rise for the best properties in the coming months. Indeed, looking at the results for the first quarters' trading, it is our view that prices have already appreciated by around 5% this year, driven by this lack of supply.Lettings Comment: In high demand
By Patrick Littlemore, Lettings Director
So far this year, the dramatic surge in tenants registering has resulted in, on average, four potential tenants for every available property on the market - a disparity we would normally expect during the height of the busy summer period.
In previous years, the vast majority of people searching at this time of year would have been doing so within the last two months of their existing tenancy. However, we have seen many tenants leaving their property search until the last few weeks of their current tenancy. We believe that tenants in the mid to low price ranges have become more accustomed to reduced property levels and start their search later, when they believe they are more attractive to landlords. In contrast, at the higher end of the market, tenants are still showing careful levels of preparation by looking well in advance of their move-in date and in some cases, we are exchanging contracts up to three months in advance of the availability date where tenants want to avoid the risk of being involved in the growing number of bidding wars that are now occurring in London.
The activity of the corporate lettings market has no doubt added to the already large number of private tenants currently searching for properties. The Marsh & Parsons Corporate & Relocation Services Department has been working directly with a number of companies from a wide variety of industry sectors. These range from oil companies to legal, and transport to media - an indicator that things are looking positive in the city. With companies still extremely conscious of operating costs, the paid for services of relocation agents have been somewhat reduced. The preferred route has been for these companies to work directly with a team dedicated to corporate and relocation services. Rental prices improved steadily last year and limited stock levels will bring a similar feel to the market in 2011, thereby maintaining the rental increases reached in 2010 and, in the case of certain properties, rising again this year.