After reading so many differing reports about the current state of the property market I thought it would be a good idea to give our loyal readers a market insight into how the property market is currently doing in Norwich & the surrounding area. The market is generally driven by one main factor – supply and demand. The more demand means less stock and that in turn fuels house prices to rise and visa-versa. One report last week in a national paper said that properties will continue to rise between 8-10% in the next year. On the other hand a property website stated some completely differing projections and recent trends. This stated that in the last month central London has seen a 32% increase in supply and a ‘startling’ reduction in the amount of transactions taking place which amounted to 45% less sales in June than the previous year. So if London is now seeing a downtown or certainly a slowdown in their market what does that mean for us in Norfolk? Well the main reason why the market is slowing is due to the Governments recent mortgage changes, which has significantly tightened up mortgage lending although it was their intention to ‘take the steam out of the market’. There are certainly fewer first time buyers around due to the new restrictions in the amount people can borrow. The mortgage companies also now like you divulge your entire spending pattern over a three hour interview process and correlate this with monthly bank statements. I for one spend a lot more money on food outgoings than I would dare to state on my mortgage form, although I can blame my two year old daughter for that, if not entirely true!
We are experiencing both sides of the market. In the earlier part of the year the majority of our golden triangle properties were selling well over their asking prices. For example one Victorian terrace we put on the market for £185,000, sold for £215,000! This was at the peak of the market and buyers were savvy enough to know the new mortgage regulations were coming into place. What we have now is a much safer and sustainable market and the scales between supply and demand have started to level off. What we all want to see is a steady increase in property values year on year not a volatile market with peaks and troughs and I believe with the new regulations that will now be the case. Whilst I would love to have a constant booming property market this is never the case and eventually we see a property crash like that in 2007. The good news for our local buyers is that properties in the Golden Triangle are able to withstand the uncertainty in the market and will continue to increase in value based on the fact that supply is always low as home owners never want to leave!