Cheltenham's Property Market
‘The summer months generally produce a calmer market than Spring’s and we are seeing signs of this already with a reduction in the number of offers being submitted, although sales are being agreed, particularly of properties which represent good value for money, and there are still some excellent proceedable buyers about,’ Phil Pugh of Philip Pugh Estate Agents in Cheltenham informed me.
He continued, ‘There appear to be a lot of conflicting reports surfacing, but we feel that house prices remain static at present and by this we mean actual selling prices as opposed to over optimistic asking prices which are then observed to be reducing to more realistic levels.
‘Anyone intent on selling during this Summer would do well to take their estate agents’ advice as there is a tendency to over inflate one’s asking price and in a less active market this can lead to a property becoming stale, and eventually selling below the actual “value” of the property. Buyers seem increasingly obsessed with length of time on the market and use this as a benchmark to popularity.’
We’ve been talking about moving to a smaller house for about six months now. Downsizing I think they call it. Getting rid of the huge garden I call it. Only talking about it at the moment and having a look at what’s around. The answer frankly appears to be not a great deal and much of what we have seen is somewhat over inflated in price and has been on the market for a long time.
Our home of almost 23 years is in a very sought after area in the catchment of a well known, desirable school so selling should be no problem - in theory. Or at least if we don’t over inflate the price and allow it to become ‘stale’.
According to David Evans from Savills, ‘Despite renewed optimism in many areas the Cheltenham market continues to be a tough one in which to operate. However, properties are selling in the town. Schools continue to be a substantial pull as does the appeal of Cheltenham to the retirement market. Realistic pricing is one factor which we are urging clients to adhere to - pricing is one element of marketing over which vendors have complete control and it should be used intelligently to stimulate interest in a sale. Alongside an effective marketing campaign it can help to generate competition, which is the best test of a property’s worth.’
So there you go – no problem so long as the price is right.
But what if I wasn’t already on the property ladder? Would I be better off renting than dreaming about that ever elusive first time buyer mortgage? That depends where you live, apparently.
In the great majority of Britain’s 50 biggest towns and cities, it costs more to rent a home than to buy one, says a survey from property website Zoopla.co.uk. Based on current asking prices and rents of two-bedroom flats around the country, its research assumed buyers take an interest-only 5% mortgage in comparison to the cost of renting. On average, says the survey, the average cost of renting is 9.7% above the average cost of buying.
Milton Keynes tops the list of places where renting is the far less attractive option with average rents exceeding the cost of servicing a mortgage by a staggering 43%. Renters are on average some £2,964 per year worse off than owner-occupiers.
At the other end of the scale, it is currently much more cost effective to rent in Poole than buy - renting is 27% cheaper and the average tenant saves £3,240 per year by renting instead of buying.
Even in London, which has by far the highest property prices in the country and where the average two-bedroom flat costs £431,366, buying is still 16% more cost-effective than renting. With average rents costing £2,137 per month in the capital versus an average cost of a 5% interest-only mortgage at £1,797 per month, renters pay £4,080 a year more than owner-occupiers.
Nicholas Leeming, Zoopla.co.uk business development director, says, ‘The relative cost of renting as opposed to buying has increased over the past 12 months as rents have risen while house prices and interest rates have remained flat. Almost 750,000 would-be first-time buyers have reluctantly ended up as renters over the past three years because they can’t get a mortgage. With current house prices and interest rates, and with rents on the rise, the fact is that for those who can get a mortgage, there may never have been a better time to buy.’
Top 10 locations where renting beats buying include Poole, Plymouth, Stockport, Bristol, Bournemouth, Lincoln, Swansea and Cardiff (Source: Zoopla.co.uk (May 2011), based on two-bedroom flat.)
Top 10 locations where buying beats renting include Milton Keynes, Birmingham, York, Northampton and Coventry (Source: Zoopla.co.uk (May, 2011), based on comparative costs for a two-bedroom flat.)
Finally, here’s an interesting fact. ‘If you bought at the peak of any of the previous housing bubbles, you could still expect to be richer 15 years later than if you had continued to rent the whole time. The mathematics of paying a mortgage, which finishes after a few decades, versus paying rent, which goes up almost every year and never ends, overwhelmingly puts buying in your favour.
‘By buying and avoiding paying rising rents forever, buyers are very likely to pay less overall in housing costs and therefore to be wealthier than renters – even if your property is lower in value after 25 years, and even if you suffer a long period of high interest rates. That’s a good consolation if you get your timing completely wrong.’ Source Confused.com