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Property market update: Long term demand for properties in fast growing East Anglia

Tuesday, 31 October 2017

Property market update: Long term demand for properties in fast growing East Anglia

PAI member Fenn Wright has recorded a strong summer for sales across its eight residential branches, but are now advising sellers to be realistic in their pricing strategy as the autumn market is seeing a transition to more of a ‘buyers’ market’.
  
Alan Williams, managing partner at Fenn Wright, said: “We have had an excellent summer for sales across all of our offices and this autumn we are seeing a lot of activity and better availability of properties coming onto the market - creating some good buying opportunities. 

“However, it’s now a much more price sensitive market. Some properties are taking longer to sell so sellers need to be properly advised on a pricing strategy at the outset because a modest reduction from an over ambitious asking price can sometimes do more harm than good.”  

According to the latest Halifax house price survey it has been predicted that a squeeze on spending and rising prices could stifle future demand. However, it is believed that the housing market is unlikely to be badly affected by a future interest rate rise. 
 
Alan Williams continued: “In this market, a lot of care and attention is needed by experienced agents to steer a sale effectively through to exchange of contracts and completion and we have noticed an increased ‘fall-through’ rate across the region, which can be frustrating for all concerned.  

“Stretched affordability is now impacting the market and indications are that prices will stabilise for the time being but against that we all know that there is enormous long term demand for housing in our fast growing region.”  

As expected for the lettings sector demand from tenants over the summer months has remained strong and the market overall has performed well for investors. However, it isn't all roses as Fenn Wright's partner, Joseph Hall explains: "Available stock remains an issue for all types of property and this continues to fuel tenant demand and rents as the lack of supply continues to fall short of tenant demand.  
 
“We are yet to feel the full effect of the abolition of mortgage interest relief, and we believe with the hardening of the residential sales market that investors will now take the opportunity to purchase properties at a reduced rate in a more static market.” 
 
In the commercial sector, continuing strong demand for vacant freehold property in Essex and Suffolk has led to good prices being achieved within both the occupier and development markets. 

Fenn Wright partner, Alistair Mitchell said: "The availability of vacant freehold property in the region is extremely limited across most sectors and good secondary investment properties in lot sizes of anything between £100,000 and £2,000,000 are equally scarce.  
 
"We have been experiencing significant levels of competition amongst cash purchasers for the few well let opportunities which do come to the market.

“However, tenant enquiries are more limited in some areas. It is quite apparent that the office market in a number of towns is quieter than has been the case for some considerable time, with occupiers biding their time before committing to new leases; Brexit and general economic uncertainty having their part to play in moderating occupation demand in the short term." 

Pictured (left to right): Fenn Wright Partners - Alaistair Mitchell, Alan Williams and Joseph Hall