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New research has indicated that the number of residential property bought and sold in Gravesham will be 2.16 per cent lower in 2018, compared to 2017, but what does that mean for Gravesend?
These ‘transaction numbers’ are based on the seasonally adjusted statistics from the local authority area suggest with the number of properties already sold in 2018, and the number of properties currently under offer or sold subject to contract (allowing for property sales to fall through before exchange of contracts).
So why are transaction numbers so important to Gravesend homeowners, Gravesend landlords and potential first-time buyers?
Many economists and property market commentators actually believe transaction numbers give a more precise and truthful indicator of the health of the property market than just house values.
For example, in the six years before the Credit Crunch in 2007/8, the average number of completed property transactions in Gravesham stood at 1,958 per year. Yet in the three years following the Credit Crunch, on average, only 1,039 homes were changing hands per year in the area.
Now, roll the clock forward to more recent times and last year, in 2017, 1,369 Gravesham homes changed hands. This is not far off the local authority’s 23-year overall average of 1,538 homes per year.
In the past, a reduction in the number of properties selling has often been believed to be the first signal of a down turn in the housing market as a whole. However, it is not always as simple as it seems.
Although the market has recently seen an increase in the number of properties for sale, when looking at the long term, there has actually been a reduction of the properties coming on to the market for sale in Gravesend.
Falling in love with the area, Gravesend people just aren’t moving as much as they were 30 years ago meaning fewer houses are selling each year.
In certain sectors of the Gravesend property market, there is a glut of suitable properties on the market at the moment, pushing down prices and values as sellers compete for the limited amount of buyers.
Yet there are other sectors of the Gravesend property market where there is a dearth, a shortage of property, and buyers are fighting tooth and nail with silly offers to try and secure the sale.
This means, there are some bargains for Gravesend’s buy-to-let landlords. If you look hard enough, and talk to the local experts, you can still get your hands on one.
It can be easy to panic when you see a drop, but no, this drop is not all bad!
In light of these numbers, some potential purchasers of property in Gravesend may be exhibiting more caution because of concerns that the Bank of England will continue to put up interest rates. But of course they will when they are only ultra-low at 0.75%!
Anyway, that is the reason why 90%+ of new mortgages over the last nine months have been on a fixed rate. Also, if they do go up a few percentage points – they are nothing compared to the 12%, 14%, even 15% mortgage rates many of my landlords saw in the early 1990’s.
We can all speculate, but what we will say to any Gravesend landlords, Gravesend homeowners or Gravesend first time buyers is to act according to your own life cycle, budget on a modest increase in interest rates in the coming few years (yet protect yourself by fixing it), consider your own circumstances and finally, buy what you can afford.
If you are looking for your next Gravesend property, contact one of our experts at Aston Anderson today.