Manxmove property market report January 2018
As we gallop through 2018 we are pleased to report that the local property market is definitely an improving one, as far as Manxmove is concerned anyway. Our negotiated sales during 2017 were substantially up on the previous year despite very similar numbers of viewing appointments, which is interesting as this tells us that the standard of viewer has improved as more viewers find themselves in a position to buy, having secured sales on their own homes.
First time buyers were also around in greater numbers in 2017 as, quite rightly, the general consensus is that the market is on the move, and with money still very cheap to borrow you really can purchase the same home for a similar monthly amount to the rental payment. Consumer confidence plays a big part in any market and viewers play a huge part in market confidence. You can learn a lot about the consumers perception of a market just from viewers comments. Almost every viewer will have an opinion on the market, based on either their own or other peoples experiences and these opinions definitely affect the overall confidence in the market. Tales of doom and gloom and massive price reductions following years of marketing will inevitably not inspire anyone to make a quick decision on a purchase at close to asking price. However, there is definitely confidence in the market at present as almost every viewer believes that the market is improving, with many having tales of properties selling before they have had time to make viewing appointments.
Don’t get me wrong. I’m not saying we are in any way experiencing a local property market boom, or that prices are going to soar in a similar way to how they did 10 years ago in a sellers market where buyers were sometimes buying homes over the telephone. However, in my opinion the signs are there that we are at least going in the right direction. Sure there are still a lot of properties for sale on the Isle of Man and some of these are not attracting interest despite being on the market a long time, but competitively priced new listings can rapidly go for asking price or very close. In addition, the market is currently experiencing a lack of stock in the popular price ranges and it is therefore inevitable that a lack of choice will increase competition between purchasers and eventually result in supply and demand issues and consequently increased prices. In addition, in 2017 Manxmove experienced a 20% increase in viewers from off Island, which is also encouraging in a market that has been about 85% local for years.
Our improving market is still stacked in the buyers favour though, so competitive pricing and immaculate presentation is still the key to a sale. Vendors who have had their homes on the market for over 6 months should have them re-valued to make sure that they are competitive with the new listings which tend to sell much faster than the older stock. Vendors of new listings should also be competitive with their asking prices as new listings will still struggle if the asking price is too high and these homes could miss the all important new listing interest experienced within the first 4-6 weeks of initial marketing. Purchasers will still pay asking price or very close as long as the asking price is fair and reflects the current market, so personally I would launch at market value and not add £20,000 on with a view to knocking it off again during negotiation.
The rental market continues to experience stock shortages, particularly in the East up to around £1200PCM. This is starting to have an effect on rental values as competition between tenants increases. At the beginning of last year you could still rent a Governors Hill type 2 bed modern terraced home for around £700PCM. However, you will be lucky to find one today at under £800PCM with some achieving over £900PCM. This improved yield is obviously appealing to buy to let investors, who favour this investment over the historically low interest rate presently offered by high street banks. Sadly first time buyers find it hard to compete with these cash investors and this activity in this area of the market is making this modern investment type property quite scarce.
December and January are historically quiet months but the sales market normally picks up nicely in February with March, April and May normally being the three best months of the year. Manxmove are currently seeking properties Island wide in all price ranges but we are urgently seeking homes between £175,000 and £375,000. We also have a database of no chain buyers that have exhausted the current market stock and are therefore only interested in new listings, so please get in touch with your property details to see if we can match your property to one of these clients.
Graham Wilson FNAEA (Dip REA)
T: 01624-61 99 66