Sherborne Times Article

I think everyone likes to think they have something to say, hopefully something interesting. For the past 12 years, as I have managed various offices or been self-employed, I am often asked my opinion on the housing market, and whilst I am no economist, I do like stats and data. I also can’t stand the sensationalist headlines that the press throws out to sell the odd rag or two. I therefore try to give a calm and measured opinion on the market, drawing from my experience of working through the financial market crash of 2008-2009, through the Brexit vote and subsequent loss of confidence, through Covid, and now in the era of higher interest rates. I am therefore very pleased to say that I will be writing a bi-monthly article for the Sherborne Times, covering the market as a whole but also things of interest to home movers, would-be home buyers and anyone else with an interest in property.

Our Favourite Places to Eat

Here at GP Weston we really want to create a hub of information relevant to people living in the area we call home. With that in mind, we ask friends (including those we haven’t met yet) and family for their favourite haunts. Here are what we have so far:

Pubs:

• Red Lion, Babcary
• The Masons Arms, Odcombe
• The Talbot Inn, Mells
• The Queen’s Arms, Corton Denham
• The Bath Arms – Horningsham
• The Bradley Hare- Maiden Bradley
• The Alhampton Inn – Alhampton
• The Kings Arms – Charlton Horethorne
• The White Hart – Somerton
• The Beckford Arms – Fonthill Gifford
• The Grosvenor Arms – Hindon
• The Lord Poulett Arms – Hinton St George
• The Bell and Crown – Zeals
• The Stapleton Arms – Buckhorn Weston

Restaurants:

• @the chapel – Bruton
• The Pharmacy – Bruton
• Osip. – Bruton
• Holm. – South Petherton
• 28 Market Place – Somerton
• Todays Menu – Ilminster
• Clockspire – Milborne Port
• The Hive – Burton Bradstock
• The Plume- Sherborne
• The Newt

 

If you would like to add to this list (and we hope you do) please either follow us on Facebook or Instagram, links to both are: https://www.facebook.com/GPWestonproperty and  https://www.instagram.com/gpwestonproperty/ 

Is your home bigger than 1,065 sq ft?

Homeowners – Do you know how big your home is?

Don’t worry, most of us don’t – yet it could be fundamental as Somerset and Dorset home buyers search for new homes.

Us Brits are obsessed with our homes, yet most homeowners need to learn the square footage (those born after the mid-1970s) or square metre(age) of their homes.

As an agent, I find homebuyers usually assess the size of their intended house purchase chiefly by the number of bedrooms the property offers. However, could we all make more effort to calculate how much actual space we require in the home outside the number of bedrooms?

Let me see how the properties locally are split down regarding bedrooms.

The split of bedrooms in Dorset is as follows:

• 8.8% of properties have one bedroom compared to the national average of 10.7%
• 27.1% of properties have two bedrooms compared to the national average of 26.7%
• 40.2% of properties have three bedrooms compared to the national average of 40.6%
• 24.0% of properties have four or more bedrooms compared to the national average of 22.0%

As one would expect for our location in the UK, we have a higher number of 2 and 3-bedroom homes in our locality.

So, are more bedrooms better? Not necessarily.

Unless you are buying a property to develop and then sell on straightaway, I believe it is imperative to enjoy your property for what it was designed to be – your home.

Though room for growth and resale ability potential of the house purchase is vital, the manner of the way you and your family live and how you use your home must be the primary consideration for improving your quality of life. And because of this …

I have noticed a slight change in how Westcountry buyers (and tenants) have been asking and enquiring about property in the last 18 months.

The first is asking for a property’s energy efficiency rating. This can be seen on the property’s Energy Performance Certificate (EPC). That was expected, with the rise in gas and electric bills.

Yet the second is that more and more tenants and buyers are asking about the size of the property, which can be found in the EPC mentioned above.

Talk in the property industry suggests a move towards home movers wanting homes with minimum square footage instead of a property with a particular number of bedrooms.

I am noticing mature homeowners in the countryside who are downsizing are asking for the size of a property, as they require fewer yet large rooms.

Should we all consider how we use the space in our homes before we decide to move? Before we do, let’s look at the average sizes of the properties locally.

These are the averages for the Dorset area.

• The average size of a house is 1,173 sq. ft. compared to the national average of 1,103 sq. ft.
• The average size of a bungalow is 990 sq. ft. compared to the national average of 862 sq. ft.
• The average size of a flat/apartment is 452 sq. ft. compared to the national average of 464 sq. ft.
• The average size of a maisonette is 689 sq. ft compared to the national average of 657 sq. ft.
• The overall average is 1,065 sq. ft. compared to the national average of 994 sq. ft.

Again, as I would expect due to our location, the average home is larger than the national average.

In the last few years, with lockdowns, as a nation, we have started to use our homes differently.

Rooms in our homes have become interchangeable – having more bedrooms isn’t automatically the status symbol it once probably was.

Spare bedrooms have become offices, dining rooms have become gyms, and so on.

Are you willing to sacrifice living room space for an extra bedroom, even if it makes the living room feel cramped and uncomfortable?

Before selecting a home based solely on the number of bedrooms it offers, there are several factors to consider.

Evaluate your current living space and how you use it.

Determine if you utilise all the rooms to the best of the space available, if you have enough storage, and if the layout works for you. If you value space and openness, prioritise square footage instead of bedrooms.

Consider your current life stage and living space needs. If you have a family, bedrooms may be a priority, but assessing how many are needed is essential. It would help if you also considered whether you need a separate space for work or a top-of-the-range ensuite.

If you plan to rent out your property, the number of bedrooms is crucial.

However, it is essential to consider the type of tenant you want to attract and what type of space would be most marketable.

Instead of moving to a new home, renovating your current space might be a better option?

By reconfiguring the space or extending it, you could improve your quality of life or increase the value of your property. A home makeover could give you the open space or environment you desire?

By answering these questions, you can determine whether the number of bedrooms, other rooms, or square footage is the most crucial factor when selecting a new home.

What do you think?

Before I go, if you are a homeowner in the Westcountry or a property buyer and you want to pick my brains on your best options, please don’t hesitate to pick up the phone or drop me a line and we can start a discussion without any obligation or cost.

Cautious Optimism in the Property Market

As the British and Westcountry property market navigates the ongoing economic turmoil, many local homeowners and landlords may feel uncertain about the future.

However, up-to-date data suggests that the 2023 property crash predicted by the many newspapers and the usual clickbait doom-mongers in the lead-up to Christmas on social media, may not be as bad as initially thought, and there are reasons to be cautiously optimistic.

According to property website Rightmove, the average asking price of a home for sale in the UK rose by just £14 in February.

While this might sound like cause for concern, asking prices remaining flat rather than falling could be seen as a positive sign for the year ahead. Remember that they are only what people are asking (and not necessarily achieving).

So, what exactly is happening in the local property market?

Well, it all starts with realistic pricing.

Thankfully, most sellers in Somerset and Dorset are heeding their estate agents’ advice and being more realistic on price, helping maintain market stability.

If you are realistic with pricing, the property should sell.

The time it takes to get a property to sale agreed upon has increased nationally from 21 days in the summer of 2022 to around 50 days in Q1 2023.

Additionally, despite the turbulent economic conditions, buyer demand is rising. Rightmove also reported in the national press that the number of people contacting estate agents has increased by 11% in the last two weeks compared to the same period in 2019.

The number of sales agreed upon has also rebounded.

Nationally, from 1st January to the 19th February 2023,
134,886 properties had been sold subject to contract in the UK.

Not a good figure when I compare it with the same year-to-date sale agreed figures from the last couple of years.

2022 – 173,607 properties sold stc

2021 – 193,607 properties sold stc

But the last couple of years have been extraordinary for the UK property market and should be taken with a pinch of salt in some respect. We must compare 2023 with more normal years, like 2017/18/19/20. This tells a different story.

2020 – 151,694 properties sold stc

2019 – 143,504 properties sold stc

2018 – 138,665 properties sold stc

2017 – 134,503 properties sold stc

The picture looks similar when we look closer to home in Dorset.

In Sherborne (DT9), in the first seven weeks up to the 19th February 2022, 71 properties sold subject to contract.

This year, from the exact 1st January to the 19th February timeline, 44 properties have sold stc, which is lower, yet in the same ballpark as 2017, 2018 and 2019.

Yet it is all terrific selling a house (subject to contract); it is still only sold subject to contract, meaning the sale could fall through (as it is not legally binding).

As an agent who likes to delve deeper into statistics, I considered the ‘net property sales’. (Net Property Sales being the gross number of properties sold that week less the sale fall throughs in the same week).

In the three months leading up to the Mini-Budget in September 2022, there was an average of 17,801 ‘net property sales’ per week in the UK. That dropped by 34.7% two months after the Autumn Mini-Budget to an average of 11,624 ‘net property sales’ per week in the UK.

In the last five weeks, that has rebounded to 17,050
‘net property sales’ per week.

And when you consider the average for the same five weeks in 2017/18/19 was 18,330 ‘net property sales’ per week, we are close to what many considered a normal market.

Improving market conditions have been supported by a reduction in average mortgage rates. Homebuyers taking out a five-year fixed-rate mortgage with a 15% deposit can expect a rate of 4.39% (correct at the time of writing with HSBC), down from an average of 6.1% in early October. This reduction in mortgage rates may have contributed to the recent increase in buyer demand.

These positive signs in the market have led some experts to suggest that a ‘softer landing’ for the UK property market than initially expected could be on the horizon.

The combination of sellers being more realistic on price and an improving picture of the number of agreed-upon sales suggests a more positive outlook for the property market.

I advise Sherborne homeowners coming to market in the upcoming spring season to use their agent’s expertise and get the price right the first time to find the right buyer more quickly. If you do wish to chance a higher asking price, only do so for no more than two weeks. If you haven’t sold by then, take the agent’s advice and realign your asking price.

34 Sherborne homeowners have realigned their
asking prices since 1st January 2023.

While it’s true that some first-time buyers may still be priced out of their original plans and may need to look for a cheaper property, save a bigger deposit, or factor higher monthly mortgage repayments into their budgets, there is still cause for optimism.

There is still a considerable demand for buying property in Sherborne – renting is becoming increasingly unattractive for many people as rents are increasing by double digits percentages.

It is important to remember that purchasing a property always involves a trade-off between what one desires and what is affordable, regardless of the market conditions. For example, while a four-bed detached house may be out of reach, a larger and older three-bed semi-detached property may be a more realistic option (and probably have similar square footage).

Sherborne landlords looking to invest in buy-to-let homes – now may be a good time, as rising rents could offer attractive returns.

Of the 37 properties let in Sherborne since the 1st January 2023, the average rent achieved has been £1,076 per month. This is a significant drop in the number of properties let in the same first seven weeks of the years of 2017/18/19 and a massive increase in rents.

Finally, the newspapers will be full of news about house price drops in the coming months. All the indexes report house sales where the sale agreed price was offered nine to eleven months ago and completed (i.e., monies and keys handed over) three or four months ago. This peculiar time lag means the house price data is nearly a year old before publication.

So, if you decide to buy a home on that information, you are using old property data. In late 2021/early 2022, there were 30+ viewings per property, and people paid way over the asking price to secure a property. Now there is more ‘normality’ in the Sherborne housing market; today’s prices are also more normal (at or slightly below the realistic asking price). So yes, the house price indexes will show a reduction in house prices. The newspapers will say house prices are crashing, yet when it is explained I have above … whilst it is not a newspaper clickbait title – it is the truth and it’s more of a return to more ‘normal house prices’.

So, prepare for clickbait newspaper headlines of a house price crash (because ‘bad news sells newspapers’ as the saying goes).

Also, prepare for the doom-mongers to quote the bad news of the earnings-to-house prices ratio at one of its highest levels ever.

Earnings-to-house price ratios are a poor measurement of health in the UK property market. Instead, I believe Nationwide’s measure of first-time buyer mortgage payments as a percentage of take-home pay is better (as it is actual pound notes out of actual pay packets).

The Nationwide measure of first-time buyer mortgage payments as a percentage of take-home pay has grown for first-time buyers from 30.4% in Q4 2021 to 39.4% in Q4 2022 … a massive rise! Yet mortgage interest rates have dropped since then (so that percentage will fall). Also, to give some context, let us not forget that percentage in 1989 was 48.4%.

Ultimately, Sherborne homeowners and landlords should decide, based on their unique circumstances, rather than being swayed by newspaper headlines or general market trends. Anyone uncertain about the property market’s future should contact me for my opinion, advice and guidance.