Southend property market up date March 2010

Auctions
Many consumers in the UK now see property as a good thing to invest in, people believe homes and buy-to-let residences will help to fund their retirement years.
Figures gathered by the National Association of Pension Funds, found that only 34 per cent of individuals polled were confident that their pensions will leave them with enough money for life after work. Flagging confidence in work savings means more Britons are being encouraged to put money into other things. Many people have switched to investments such as buy-to-lets.
This trend was certainly borne out at our March auction where a hundred percent of our lots sold at full prices. Competition between investors was strong as they bid to secure properties to either add to their rental portfolios or refurbish and sell on.
Sales market
People seeking to invest in real estate, can secure property at its most affordable price since 2003. This is according to new figures from Zoopla.co.uk, which show that the average worker can now afford 58 per cent of homes in the UK. This is an increase on the 34 per cent recorded in 2007. However it is our opinion that whichever government gets into power at the next election they will still need to do more to increase housing affordability for first-time buyers. Among the measures needed we think are sensible lending policies and the increase of new home building.

In Southend the supply of new properties slowed towards the end of February and into the first part of March. However this trend seems to be changing as over the last week considerably more properties came onto the market. As more choice becomes available it is inevitable that properties will take longer to sell. There is also currently a tendency to put homes on the market considerably higher than the current market value. This again is delaying the sale of property while either sales are negotiated or sellers are forced to reduce their prices if they are serious about moving. Another effect of this market is to see that those properties that have been on the market for longer are being sold as they represent better value.
With the launch of Tudor’ distinctive homes service we are seeing the upper end of the local market performing well.
Rental market
The rental market remains strong with supply and demand being more or less equal. Houses are in the highest demand especially larger properties and flats need to be competitively priced if they are going to be taken. Properties that are not presented well are seeing rents reduced so taking a little time to redecorate or clean a home after occupation can reap dividends.
Mortgages
The Financial Services Authority (FSA) has revealed that mortgage lending to those going through the conveyancing process to purchase homes is rising in the UK.
According to the organisation, finance for property buying "continues to represent an increasing share of new lending". It noted that such activity accounted for 62 per cent of new advances and 63 per cent of new commitments in the latest quarter.
There is also greater innovation being shown in the mortgage market by lenders such as Mortgage Works a subsidiary of Nationwide Building Society who have introduced a loan that could provide a useful way for first-time buyers to secure a property.
Unlike existing guarantor mortgages, it accepts that parents have "commitments of their own". The product was launched earlier this month and it operates on a 75 per cent loan-to-value basis on a two-year fixed-rate mortgage. It comes with a rate of 4.99 per cent and guarantors need to agree to cover 30 per cent of the loan.
The other good news is that the Bank of England figures, revealed the average cost of a two-year fixed-rate mortgage is at its lowest level since the summer of 2003.The typical deal had a rate of 3.88 per cent last month, which was a fall from 4.35 per cent during the same time last year, the organisation noted.
Summary
Public opinion for investing in housing appears to be growing but has not been fully seen in market activity yet. Property is more affordable now than any time since 2003and mortgage supply and rates have improved every month so far in 2010.

Alan Kirkman FNAEA
Director
Tudor Estates
18th March 2010

For further information on the property market go to www.trustintudor.co.uk