This week I’ve been looking at the property market for existing houses, rather than new build, something I have not visited here before. I spoke to some of the many estate agents in Farnham last week and they told me their thoughts on where we are, following the release from lockdown, and where they think the market is going.
The government announced a temporary increase in the stamp duty threshold to £500,000 for property sales in England and Northern Ireland on Wednesday, July 8.
Anyone completing on a main residence costing up to £500,000 between July 8 and March 31, 2021 will not pay any stamp duty, and more expensive properties will be taxed only on their value above that amount. This will save buyers as much as £15,000, if they are buying a property of £500,000 or more.
* Window of opportunity
Estate agents see this as a fantastic window of opportunity, with low interest rates adding to the incentive to take the plunge and move house.
Traditionally, a majority of people want to move and be in their new home either before the summer holidays or before Christmas. The spring market was lost.
Sales and purchases have been delayed. The lockdown has given many an opportunity to review their position, their current accommodation and their aspirations.
The picture painted by the agents across Farnham is a very good one. Bourne estate agents told me they had received and completed a month’s business in two weeks and had just had their best week ever.
Also, lettings were up 75 per cent. Trueman & Grundy said they were experiencing substantial demand from clients.
There have, of course, been many frustrated parties unable to complete their sale and/or their purchase. Solicitors have been rewording contracts to allow sales to complete. There are also those who have lost out on savings on stamp duty.
* Confidence is good
National newspapers reported a reduction in house prices. That is not the case in Farnham, I was told by more than one of the agents.
The agents report sellers are putting their properties on the market, purchasers’ enquiries have increased, and sales have increased, all significantly. Andrew Lodge agents told me that one property, priced at £900,000-plus, sold within four days of being put on the market. Confidence is good.
There was controlled but intense activity in every agent’s office I visited, with every desk occupied.
* Increased interest from London
Every agent I spoke to told me that interest from buyers currently living in London has been incredible – up by more than 20 per cent since Covid-19, according to one agent.
Many potential purchasers currently own a terraced house worth upward of £800,000.
You can buy a good family home in Farnham for that and Farnham has a good rail connection to London and, most importantly, superb schools.
The pandemic has proved we can work from home, and many would prefer to do so. And it can be beneficial for both the employee and employer.
I have been told of a number of London office deals that have been paused or cancelled by the ingoing party.
* Crystal ball
So what is coming down the line? What I would do for a crystal ball!
All the agents I spoke to pointed out the likely impact of the end of furlough, with the result that, regrettably, some people may need to downsize.
They foresee continued strong activity during the summer with a softening of the market later in the year, maybe October. None mentioned a reduction in house prices but that can follow.
Worryingly, there are reports the recovery could take more than four years – with some saying, I am told, up to eight years.
* Home extensions
In the past year, agents’ fees, stamp duty and removal costs have led to an increasing number of applications for house extensions. This is a growing trend as existing owners decide to stay put and extend, and purchasers extend their new home to meet specific requirements.
It was announced on July 21 that new permitted development rights will come into force on August 31, 2020 relating to buildings built between July 1, 1948 and March 5, 2018. This will make the process of extending homes easier, preventing the need for planning applications for an increasing list of works.
* Pump House
I am told The Pump House in Kimber’s Lane is under offer on the basis of a new long-term lease. Curchods will release details of who the party is and what they do as soon as it contracts are signed.
The land is included within the Revised Farnham Neighbourhood Plan for the building of up to 20 homes.