HUGE pent-up demand from housebuyers is about to be unleashed, a leading local estate agency has predicted.
The first indications of an economic recovery will release a tidal wave of would-be buyers who have been forced to postpone plans to move because of the state of the current market.
But the market may not be ready to meet the demand when it comes and that could force prices to surge upwards, according to property specialist Jed Furniss, a consultant to Blundells, one of Sheffield and North Derbyshire’s leading estate agents.
And he warned that anyone putting off buying now because of uncertainty about the market could then find themselves caught up in the rising spiral of demand and supply.
Jed said: “This is the time to buy because, inevitably, as the economy recovers and the banks relax their lending criteria, purchasers will return to the market.
“And when they do, the pressure on supply will also return and prices will rise.”
In a review of 2010 and the early part of 2011, he said that following eight months or so of a gradual recovery in the market during the second half of 2009 and first quarter of 2010, suddenly the market froze.
The build up to the general election in May 2010 and the few weeks after it changed the general public’s confidence about the economy and subsequently their decision over whether to buy their first home or move house.
This year, Jed, who is based at Blundell’s Hathersage branch, says, the housing market hasn’t been helped by the VAT increase, job cuts in the public sector, inflation over the government’s target leading to talk of possible interest rate rises and a consequent reduction in people’s disposable income, and the ongoing problem of businesses and individuals obtaining bank finance.
But there are reasons to be cheerful, he maintains, and some stability in the current market is one of them.
“Despite the seemingly never ending flow of bad news, there is a mixed range of forecasts for prices in 2011,” he said, adding that most predictions seemed to be suggesting a two to five per cent fall in prices or no fall at all.
He said: “The argument for a relatively stable market stems from the lack of supply of homes coming up for sale.
“In the Peak Park, for instance, this is most certainly the case.
“Today, there are only about 180 homes on the market in the whole of S32, S33 and DE44/5 postal area, with many of these having been for sale for six months or more.
“There is an underlying shortage of homes available for buyers to view, far fewer than in a ‘normal’ market and this is inevitably underpinning prices to a degree.”
Jed advises sellers: “Pricing is critical.
“Getting the asking price wrong in this market can be disastrous.
“The most important period of a sale is the first four weeks and it is vital that the property is priced competitively at the outset to maximise the number of enquiries.”