However, despite this improved sentiment, there is no doubt that the dream of home ownership remains a challenge for many and so with the ratio of home ownership to renters continuing to diminish, demand in the lettings arena also remains strong, the firm says.
Its first quarter report shows that the current residential sales market is particularly buoyant for sellers as applicant registration levels have risen by nearly 40% over the first quarter of the year. The number of viewings carried out are also reported to be up 28%, nearly matching that of the 27% increase in sales.
‘Stock levels have remained static and this relative lack of suitable stock is encouraging buyers to make quicker decisions and offer higher figures in order to avoid losing out on their chosen property, subsequently enabling many vendors to achieve their asking price,’ said Douglas Sleaper, group sales director for Townends.
In comparison to the astronomical rent rises experienced in 2011, the first quarter of this year has seen rental prices readjust, settling at a more realistic level. ‘In some cases, landlord sentiment remains that prices should be going up, however this is proving to be an educational process, because prices simply can’t go up any further and certainly not at the same pace we saw last year,’ said Caroline Kavanagh, managing director of Lettings and Management at Townends.
Demand remains high, especially for prime stock, but what has been particularly apparent so far this year according to Kavanagh, is how increasingly shrewd tenants are. ‘A greater number have done their research and are not necessarily grabbing the first property they see, even though stock is limited. This is ultimately down to the need for them to feel they are getting a decent property at a good price and so are more prepared to wait to get value for money,’ she explained.
‘Prices have and in some cases still need to find a new level although many landlords have accepted this and take a more flexible approach to their investment, purely by understanding that rents do fluctuate. Compromise is becoming less favourable for tenants and this is where landlords need to bridge the gap at times,’ she added.
She pointed out that the firm has not yet experienced a surge of investors coming to the market, albeit the general feel in the market is more upbeat and there are certainly more prospective investors looking and gauging the market, ready to snap up good investments when they arise.
In sales, the greatest demand is being generated from those buyers looking to upsize into a family home. This is particularly true of peripheral areas of London such as Chiswick and Ealing, where applicants from Central London are looking to purchase more for their money and as a result, there is a need for more stock to supply demand,’ explained Sleaper.
The interest has not dropped following the removal of the first time buyer stamp duty holiday, and March was the most active month of the year so far for Townends. Prospects for quarter two seem equally positive with properties that are well priced attracting interest and multiple bids.
‘As always, asking price does matter as buyers are increasingly savvy and in most cases prepared to walk away from properties that they don’t deem to be sensibly priced,’ said Sleaper.
