would you describe business at the moment in this area?
It's definitely slowed down. I would say the market has changed
considerably over the last three months, and that's due in the main
to prices reaching their peak in Luton, right through from the bottom
end of the market up to the top.
'Buy to Let' affected the housing market locally?
For the past couple of years the bottom end of the market has
been fairly saturated with investment purchasers - not giving first
time buyers the opportunity to find a property let alone buy one.
the past we've had investment purchasers building their own portfolios,
buying three or four houses at a time, with estate agents probably
prioritising these investors over first time buyers simply because
they can sell them two or three properties in one go.
has stimulated a growth in the bottom end of the market which has
obviously then increased demand and property prices.
now that the rents that these people are achieving against the values
of the properties they have bought are no longer balancing, the
market for investment purchases has slowed down considerably.
Estate Agent David Gauntlett
someone at the top end of the market reasonably expect to achieve
their asking price in the current market?
People are now having to consider offers, probably the most expensive
properties in Luton - right up to £600,000 are taking time
to sell. They are at their 'max' at the moment.
sort of properties are now getting offers coming in around £20,000
or £30,000 below the asking price - with negotiations taking
place from there. So they're taking a bit longer to sell which is
having a knock on effect through the rest of the market.
there an element of panic now amongst first time buyers - in that
if they don't buy something soon then they will never be able to
get on the property ladder?
Prices are at an all time high at the moment, and the main problem
people have is raising a deposit to make buying a house more affordable.
average first time buyer in Luton would now have to find around
£90,000 - £135,000 to buy their first home. We now predominantly
find only couples coming in to look for a property, individuals
can quite simply not afford it on their own.
when earning £20,000 a year, then three times that is still
quite simply not enough - even if they have a substantial deposit.
It's hard for young people.
first time buyers are definitely slowly coming back into the market
- and they have plenty of choice now that the investment purchasers
are not snapping up everything in sight.
first time buyers will have already spoken to a lender or financial
advisor and clarified exactly what they can afford - whether it
be monthly expenditure or what they can borrow as a maximum and
then they will come to us to view a range of properties.
couples often find it hard to make the time to visit an Estate Agent's
Office during the day and will make extensive use of estate agents
websites to view suitable properties before expressing a serious
interest - we don't get as many walk in enquiries as we used to.
you find that people from London and South Hertfordshire who cannot
afford to buy property there are now looking in Luton and the surrounding
area for more affordable housing?
- 50% of our buyers are from that area. The volume of London buyers
is absolutely vast at the moment, simply because they cannot afford
to buy anything in London. Luton is an ideal commuter town with
great road and rail links into London.
would be your advice be to a first time buyer?
looking to become a first time buyer, you're aged between 25 and
30 and you've achieved a reasonably good position of employment
with a good wage, then my advice would be to save as much as possible
to be able to put down as big a deposit as you possibly can.
will enable you to keep your mortgage payments to an affordable
level - don't borrow to your maximum because you've still got to
be able to afford to live and pay all those other bills and still
have something to fall back on if interest rates to start to fluctuate.
a lot easier if you're a couple, you can definitely borrow more
comfortably and obviously you'll have more money coming into the
have had instances of parents helping out their children with deposits
on properties - all though this is obviously rare.
you expect interest rates to rise and affect the market again?
I certainly don't see us having another crash in the housing market
like we did back in the 1980s.
talks we've had with financial advisers, they have all said that
we should have a five per cent base rate by the end of the year
- but they are not always right!
housing market as it is cannot go on - interest rates are the only
real thing that makes a difference, they stimulate growth in markets
or they decrease them, because at the end of the day it is all about
what people can afford.
fact that we've had two mortgage rate increases already this year
has definitely slowed the market down and made people think first
and be a little bit more cautious.
time buyers are getting advice from their parents, and their parents
are going to be a lot more cautious and advise their children against
being impulsive and buying the first property they see.
an ideal world - would you alter anything about the housing market?
people want to buy a property, they don't always look clearly into
whether they can really afford it or once they have put a mortgage
application in they discover that something like an outstanding
debt or a bad credit reference will affect their mortgage.
can then cause a problem within a chain when the Building Society
turn around and say 'no' to the mortgage application.
would much rather see people actually clarify their status at the
beginning of the process - it would speed things up ten fold because
people could then walk into an estate agent's office with their
money already arranged and ready to spend - not just saying 'yes
- potentially we can buy that' because it's all subject to status
and yet more paperwork.
Buyers Reports are another thing that need overhauling. If you own
your home you should have to prove to a prospective buyer that it
is in good order.
will eventually have to provide the equivalent of a Home Buyers
Report on their house - pretty much like providing a service history
and MOT when you sell your car!
that the property has been maintained correctly, and that any alterations
have been done correctly and with the necessary permission.
it will make people put their houses in order before they put them
on the market so that when a buyer with their mortgage in place
comes along to buy the property, the title of the property will
have already been put in order and the condition of the property
will have been established.
buyer will be aware of any defects on the property from the very
beginning and again this will speed the whole process up - probably
take some adjustment and may even slow things down for a while,
but it'll be good for everyone in the end.
read about the housing market in St Albans >>