Confidence returns?
For me, it's 100% clear from speaking to local agents, other property sources, developers and even finance companies, confidence is returning to the property market.
Almost every estate agent I speak to now comments on the fact that enquiries are up. There's also a lot more activity from people looking to buy their home, and some agents are even finding that they have more buyers then instructions (sellers' properties on the books). More buyers then sellers is a classic example of demand growing higher than supply.
Do understand that this is very much based on the area but it is certainly a good sign of what's coming.
Finance companies are repossessing less now and the repossessions they are being sold at near-to-full market value; most are totally dismissing our offers.
Lenders are even realising that the market is on the way up which is why they are changing their terms and conditions for developers, allowing them to tenant their properties with the intention of selling in the near future.
Over the past few months, we have seen many lenders agree to take a hit on what the developer owes them to move off site and get some money out of the development. This is very quickly coming to a halt as the developers' banks stick to their guns, and in some cases even advise the developer to sell in the very near future.
Other property sources I work with are constantly asking me if I'm seeing discounts dropping off a bit. Of course, this is really their way of admitting they can't find good quality stock at the moment at the discount they need. And to be honest, I am finding exactly the same problem over the past few weeks I have been struggling as the sales guys are selling more than I can source.
But it's what the developers have done in the past couple of weeks that show clear signs of confidence.
On more than 5 occasions in the past 2 weeks alone, we have had sales agreements out with various developers on off plan property where the deal has been agreed verbally, but when it came to confirming the deal they changed their mind and decided that there would be no point in selling to us at our prices.
In each case, they said that they think they would be able to make a larger profit if they just hold fire a couple of months.
Of course, I try and convince them that they should get sell now by sending them as much negative information from the press but it's soon becoming very quickly out of date. And they see this first hand as footfall into their marketing suites is increasing every day.
I have been saying this for a while now, and I think the time has finally come where discounts are no longer at the levels we have previously seen and would be very surprised if we see them again anytime soon.
Live with passion,
Brett Alegre-Wood
