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Market strength with a leg at each corner

By Alistair Hilton, head of sales at Balfours

The property and land markets currently have legs as strong as any Hereford Bullock – storming across an open field.

The analogy is substantiated with a leg at each corner: Namely a 13-year property supply issue; interest rates below inflation; a lifestyle driven surge in rural demand; plus buying power of former city dwellers.

In our Shropshire and borders-based estate agency we know whatever we take to market right now will sell, with more than usual going to sealed bids. This is partially because housing supplies have never truly recovered since the financial crash of 2008. Brexit then kept vendors hovering and finally Covid whipping up the perfect storm.

Last year, 2020, saw a shift in demand to the rural market, irrespective of stamp duty and furlough, wealthier householders with city properties now have not only the buying power, but the homeworking lifestyle to move to the country.

I believe we will continue to see an increase in prices supported by how cheap and affordable money is from a buyer’s viewpoint as lenders fight for customers. When mortgages can be picked up at one per cent above Bank of England base rate and inflation is running above two per cent, it would seem sensible to take on third party borrowing; that is further fuelling house prices. In essence it means house buyers are paying less than last year which is impacting on house price purchasing power.

CAPITAL ASSETS

The take home for property and landowners, be it that farm cottage which has bumbled along, the derelict farm buildings or the field corner which buts up to the local village, it is time for a business meeting, visit to the accountant and re-appraising your farming business assets and management strategies.  I am not simply talking about selling the family silver, but rather maximising your assets in whatever guise suits your future business plan.

There are many ways to skin the game, but without doubt what the past 18 months has taught us is the world is moving and moving fast and we all need to progress to keep up.  I am not the only one whose emails, text messages and phone calls are on overload, my colleague in lettings has a similar “hot property” story to tell. The property sale and letting markets look set to continue for a number of quarters, if not years. However factoring in protracted planning permission and hiatuses in the construction industry – it would be best act now. Like that Hereford bullock, your assets are best progressed in this prime market.

Alistair Hilton

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