Survey Results - What people think about the LOCAL property market by Mark Welton
I have long been skeptical about the abundance of surveys and commentaries that are carried out on the property market, quite simply because they focus on “a national market” with little or no regard for local or regional variations. Statistics are dredged up from banks and building societies relating to borrowing trends and individuals are poled in different parts of the country. Somehow as a result judgments and predictions are made about “the property market” as a whole, which in my view provides an extremely generalised guide at best or a completely distorted or false impression at worst!
I do not believe there is any such thing as the property market as a whole rather that the market reflects local and regional variations in terms of experience which can strikingly differ even within different towns in a region!
As a result we decided to conduct our own local survey and asked local buyers and sellers what they felt about the market in their own area i.e. the Brighton and Hove area. We asked for feedback from our entire data base of registered buyers and sellers and via our Facebook and Twitter pages.
Generally we received a very strong response which clearly demonstrates how important people regard the property market and how interested they are in its performance generally.
Essentially we asked some very straightforward questions with a number of possible answers in order to gauge how people actually felt about the market in their area.
Our first question related to how people perceived property ownership either as a good medium to long term investment or short term.
A resounding 92% viewed their property ownership as medium to long term. For us this was a particularly positive and encouraging sentiment in that people believe in the future of the market as a strong and safe investment. It also reflects a move away from the “get rich quick” phenomena which characterized the market in recent years. Are people now viewing their properties as “homes” rather than houses?
We then asked our poll to consider whether they felt that renting was a “safer option” than buying. This was partly in response to a number of reports that people were moving towards a “renting” mentality which characterizes the theme of some other European countries. The results were very strong in favour of property ownership. 83% of applicants felt that renting was not a safer option than buying. Again this was a very encouraging, albeit perhaps a little surprising given the very active lettings market which currently exists. However it reinforces the results of the first question in that people certainly believe in the investment of property.
We then asked people’s view of the likelihood of interest rates remaining at their current levels. Concerns about rising interest rates can cause “inertia” in the market affecting confidence and the desire to buy property. 69% of people felt that interest rates would remain at their unprecedently low levels as opposed to the 31% of them who expected them to rise. Again we believe that this is a particularly encouraging statistic insofar as people’s confidence is concerned when they are considering purchasing a new home. Indeed this takes us nicely into the next question about people’s plans for moving. Confidence about stable interest rates would have little importance or relevance if they had no plans to move!
We asked our poll to state whether they were planning to buy or sell in the next 12 months, 2 year or 5 years. 79% said they expected to move in the next year with just 10% and 11% said respectively intent on delaying their move for up to 5 years.
Lastly we asked respondents to predict how they expected property prices to perform during the next 12 months ie whether they would increase, go down or stay the same. Here the results were very close. 46% felt that property prices would remain the same with 45% expecting further falls in values. A more positive 9% expected values to actually increase during the same period.
Personally given the positive responses to the previous questions I would have expected more people to have fallen into the “staying the same” camp. However the results are probably not that remarkable given the perpetual “doom and gloom” fed to us by our wonderful media!
Overall at Mishon Welton we are very heartened and encouraged by the results of our survey. They demonstrate a very optimistic and positive attitude towards the local property market generally and a robust view and expectation towards property ownership and investment specifically. This also in the context of the local market that has received its knocks and has had its confidence dented in recent years.
What are your own thoughts about the results of the survey? Please email us if you have any thoughts or views via email, Facebook or Twitter.