The Royal Institution of Chartered Surveyors (RICS) this month reports that house prices in the United Kingdom are now on the rise. This comes after other recent comments from Halifax Bank and from Nationwide Building Society also indicating price rises have been fairly consistent over the past three or four months. Also, Taylor Wimpey, the chief house builder in the UK, detail an increase in house sales for the first half of the year. So recent confidence that the housing market has finally bottomed out does appear to be reasonable. For house owners looking for a Quick Property Sale now could be a very good time to consider putting a property up for sale and hopes to Sell Property Fast may well be satisfied.
However RICS do warn that there is unlikely to be a return to the heady times of house price inflation. The current stage of house price values is best seen as a new area of stability from which values will improve slowly, hopefully in line with general inflation trends. The dramatic falls in house prices suffered in the last 2 years are best taken as a necessary correction to an overheated market. Property values had been driven to unsustainable levels due partly to the easy availability of cheap credit. But another aspect was an over enthusiastic and naive investor sector egged on by the availability of 100% finance to buy up property for investment or buy to let.
The current market level looks much more logical taking into account current costs of borrowing, average wages and the careful lending criteria presently being applied by all mortgage lenders. But as the economy remains fragile, with unemployment likely to rise further before starting to fall next year, a house price bubble is not to be expected.
So when RICS says that house prices are on the rise again this categorically does not mean an immediate or imminent return to the peaks of mid 2007. Property sellers need to bear this in mind, the current improvement does not mean that they can market a property at what is was worth 2 years ago and make a fast house sale. Sellers must adjust asking prices down in line with current value levels, the only properties being sold are those where the price agreed is about 20 – 25% down on mid 2007 levels.
Those wishing for a quick return to earlier levels will be disappointed. Even if house prices rise at say 3% per annum ( and that at present looks optimistic) then it will be about 7 years before mid 2007 prices are seen again. If I needed to Sell my House fast at the moment, I’d be extremely flexible on the price, and prepare it to the very highest standard in order to give myself a reasonable chance for a Quick Home Sale.
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