WITH the year drawing to a close Stephen Christie-Miller and Richard Maby from Savills report
WITH the year drawing to a close Stephen Christie-Miller and Richard Maby from Savills report that aspirations for £1million properties have been strong and are set to continue.
“The residential sales market in Henley this year really has been a tale of two halves,” says Stephen Christie-Miller, head of Savills Henley.
“Demand for properties priced up to £1 million has outweighed the quantity of available quality stock helping to keep prices relatively strong.
“This is where the majority of sales have been completed, as buyers take advantage of continued low interest rates and the differential between London and the country.
“We are anticipating demand at this level will continue throughout the course of 2016, although further substantial price growth in the short-term may be tempered by the rhetoric surrounding a potential interest rate rise and continued rigorous fiscal checks.
“The market above £1.5 million has been challenging this year, although not stagnant. Purchasers at this level of the market remained cautious in the lead-up to the general election in May and many have been further deterred since by the increase in stamp duty levies which were introduced at the end of last year.
“However, for those properties which have been best presented, in the most highly desirable locations and, most importantly, priced competitively, we have been successful in completing a number of sales.”
Mr Christie-Miller is hopeful that next year will see more transactions due to economic and political stability and as buyers adjust to stamp duty levies.
He adds: “Much of this interest will be dependent on the movement within the London property market and the realisation by vendors that, to able to sell, they too will have to adjust their asking prices downwards.”
Richard Maby, head of Savills Henley Lettings, says there is a close correlation between the sales and lettings markets with almost half of the tenants in town who, having sold their own homes, are choosing to rent.
He said: “As a result of lower activity in the sales market, transactional volume in the lettings market was down by about 25 per cent year-on-year. The election period certainly had a similar quietening impact on the lettings market demonstrated by the historically high renewal rate of tenancies in the first six months of the year (which reached an average of 90%, compared to a more usual rate of 66%). It was therefore inevitable that stock levels and applicant demand would be down on 2014. However, prices have remained steady, given that the downward pressure on these two factors was fairly balanced.
“The ‘town’ market for family-sized commuter homes remains the strongest in demand, with the larger country homes still needing to be carefully priced to attract interest.
“Looking to 2016, we expect activity levels to increase marginally where tenants make plans for their futures having enjoyed relative stability over the past year.
Investors are still actively expanding their portfolios although the changes in taxation relief on mortgage interest will inevitably be a consideration and may slow the rate of investment.
Prices are forecast to rise modestly, a little ahead of inflation, but budget constraints will curb any significant rises.”