A number of landlords, first time buyers and investors have
approached me recently, asking about the Eastwood property market. With all
these headlines of massive increases in property values in the UK, should we be
worried we are about to have a price crash? We are at the early stages but the
economy is now actually looking a lot healthier and there are signs we are
seeing an actual recovery after several false starts.
I am of the opinion that over the last few years, whilst
mortgages have been a little more difficult to obtain than the last decade of
the 2000’s, this lack of mortgages has produced some pent up demand for
property. Now we appear to be on the other side of the financial crisis, and
the banks are more willing to lend, this is why sales, prices and first-time
buyer numbers have improved so rapidly. It has been like opening a shaken can of
fizzy pop. You get the initial fizz of activity, and then it flattens. What
we're seeing is a relatively normal market correction, not a quick transition
from a recession to a boom.
Property values in Eastwood have risen, on average by only 5.94%
in the last 12 months. When I look at the East Midlands as a whole, prices have
risen by 7.9% and nationally by around 8.7%. Compared to the boom years of 2001
to 2004, when property values increased by 20% in 2001, 33.9% in 2002 and 8.4%
in 2003 in Eastwood, I cannot see why some are concerned about an unsustainable
price boom. I believe house prices are rising off a low base and talk of a housing bubble in relation
to the national market is overdone. We are seeing continued exceptional property price growth in London combining
with modest gains across other regions and creating a picture of a broadening
market recovery, and I expect prices to continue to rise in the short term.
Speaking to others in Eastwood, the issue isn’t house price
inflation, but a lack of realistically priced properties coming onto the market
for sale, a lack of supply. So should you be buying a property in Eastwood? Now is a good time to buy, provided you accept prices
may fall again in a few years. It depends on how long you plan to own the property (whether
as a home or investment), whether it personally suits you and most importantly
whether you can afford it. Eastwood first time buyers preparing to take the
plunge should bear these factors in mind. The biggest issue must be that buyers
ensure they can take the hit of future interest rate rises and therefore, I
ask the first time buyers of Eastwood to make sure you'd be happy in your new home, because
you could be stuck there in five years' time.
Landlords tend to buy for the long term, so these short term movements
don’t tend to affect them as much. The lack of supply in Eastwood of new
properties coming onto the market indicates people wanting to buy have to move
quickly, and don’t have the luxury of a few weeks to decide to view the property.
However, my findings show that first time buyers and landlords in Eastwood
aren’t prepared to pay over the odds for a property to secure it. Maybe, just
maybe, the memory of the 2008 price crash has given a dose of realism to the
optimistic Eastwood property market?
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