Thursday, December 6, 2007

Good News!

Good news! The Bank of England has today reduced the bank rate by 0.25%. This is a step which in itself will have little impact on mortgages etc but it does send a positive signal to hard pressed borrowers. If nothing else it indicates light at the end of the tunnel.

Many people have experienced £150 a month rises in the cost of their mortgage and this has come about because most mortgages these days are adjusted annually or are fixed rates or discounted rates. Add in to this scenario the recent hike in fuel costs – diesel locally at £1.09 per litre! and you can see why consumer demand has slowed.

In my opinion interest rates have always been something of a blunt instrument when it comes to slowing down the property market. In the late 1980’s and early 90’s interest rates rose to, albeit briefly, 15%. The property market was decimated and what needed a touch on the brakes began to appear as though someone had removed the wheels. It isn’t necessary to go to this extreme. They need to be a little more scientific about the process. It needs an ABS system for interest rates, to continue the motoring analogy!

We heard today of a bailiff in Hertfordshire attending two repossessions per day with the next week fully booked. Mr King and Mr Brown would do well to acknowledge that whilst controlling inflation is important those repossession levels are back to late 1980’s levels.

Wednesday, December 5, 2007

What's going to happen to House Prices?

When Will House Prices Finally Crash? – 24/11/2006 Money Week
Is there going to be a house price crash? – 2/11/2007 Thisismoney
UK house-price bubble about to burst – IMF 18 October 2007 Nick McDermott, Daily Mail

Every newspaper, pundit, lender, estate agent, developer, builder and householder would like to know the answer to ‘What’s Going to Happen to House prices’. If you read the newspapers last weekend from broadsheet to tabloid then your only conclusion could really be that they don’t know!

I think the Sunday Express probably came close when they said that the Government/Bank of England probably has 90 days to avert the same sort of crash that occurred in the late 1980’s to early ‘90’s. Of those 90 days 30 have already gone so the clock is ticking and the next 30 days are mainly holiday time over Christmas when not a lot happens in the property market anyway. A reduction in interest rates by the Bank of England may not actually have an impact on mortgages but it would send a signal to the homebuyer/seller that there is light at the end of the tunnel. Now is definitely the right time to speak to Margaret our resident mortgage adviser with Bright Mortgage Advice. She is an IFA (Independent Financial Adviser) and is able to search all of the mortgage market for the right ‘deal’ and is not restricted to any one insurer. With the ‘credit crunch’ upon us it could be the best initial move you make.

I don’t think there is any argument about the market cooling off. If you speak to any estate agent that you expect to tell you the truth (let’s face it they don’t all do that) then they will confess to market conditions being ‘challenging’. That is a real sign that the market is cooling, verging on positively freezing!

What then do we do about it? The answer is really very simple. The asking price of every property placed on the market needs to be accurately assessed initially and then closely monitored to ensure that the marketing feedback is strong enough to warrant holding it at that level. It’s fair to say that price reductions of less than 5% rarely do the trick as homebuyers don’t perceive a change in price.

At David Clark & Company we use a system for valuation produced by a company called Hometrack. They provide a service that delivers a property marketing report that gives us unparalleled market data to justify our proposed valuation. In Ely this is exclusive to our firm and we link this to a ‘market comparable’ report from Rightmove and leave it with you, in black & white – for free.

All agents should be members of some form of redress scheme and the majority (including ourselves) are members of the Ombudsman for Estate Agents. The code of practice that goes with that membership means that every marketing price opinion provided should be supported by details of the pricing of at least 3 comparable properties. We will do this whenever possible and have been members of the OEA since its creation and long before compulsion.

Above all don’t panic. Most of us here at David Clark & Company have been through difficult markets before and know how to look after your interests when selling and can provide guidance when buying. Talk to us when you feel the need to move.

Sunday, November 25, 2007

Your Next Home From My Blackberry

The idea of being subscribed to a blog is to receive information that is relevant to your interest as early as possible.

When I'm out and about visiting properties that often come onto the market I can get this information into the public domain very quickly, in fact, there and then. This post came from my Blackberry - easy as that!

If you would like your home valued and marketed quickly and efficiently to the widest possible audience just call me on 07909 680642 or e-mail
Let your email find you with BlackBerry from Vodafone

David Clark
The Property Sales People 01353 665020

Saturday, November 24, 2007

Switch on the lights!

There is a new feel and look to the double front office window of David Clark & Company estate agents on Market Place in Ely. The windows have always been well lit in the early evening but David had become concerned about the heat generated by the spotlamps and the obvious energy wastage. In addition some of the bulb holders had disintegrated with the heat so bulbs could not be replaced.
In conjunction with a local electrical wholesaler the window spot lights have been re-fitted with low energy LED lamps which produce the same, if a different colour, light. The original lamps were 50 watts per bulb and the new LEDs are only 1.5 watts. This should result in some energy savings and lower bills.
The introduction of Home Information Packs has had an impact on people’s focus on energy use within their home as a Domestic Energy Assessor calls to provide an indication of a property’s current energy use and it’s potential after any improvement to insulation etc. David said “This got me thinking about how we could do as much as we could in the office for the environment , with the spin-off of cheaper bills.” Other measures have included ensuring that all PC’s are completely shut down at night.
Home Information Packs have been extended to 1+ bedroom homes from the 14th December and these smaller homes will then be showing details of their energy efficiency to prospective buyers. The likely purchasers for properties at this end of the market will be financially hard pressed first time buyers so the energy efficiency of a home may well become more of an issue when they decide on which property to buy.
David Clark & Company have teamed up with Aran Services Ltd to offer free insulation surveys and in some cases there may well be grants available towards the work. Call them on 0800 5877795 and quote David Clark & Co.