Can the property market be compared to the quality of a champagne label? If the answer is yes, then probably most of us would agree that the word Krug would attach to 2007 both in terms of timing and annual increases. Berkeleys might even be tempted into a tasting again soon. But I would counsel not let it go to your head – yet. A huge variety of champagne house names intervene before we reach the more humble offerings from the cellar. Each of them has a significant, individual bouquet. Keep your nose for the right deal.
The local residential property market in Poole, Dorset BH13 is selectively appetising. There are more “tasters” out there than there were last year. The market south of £1.5 million, down to £200,000 – what one might call the Moet to Prosecco market – is considerably more active. In the year to date (January to July – compared to the same period last year) there have been 334 sales (against 266) – see chart below. On the other hand, the “Bollinger” to “Krug” market (sales north of £2.0m), the balance has shifted in both directions for each segment.
|Description||Jan-July only; BH13 and BH14 8 only ; > £200,000 only|
|Sales @ £3 m +||4||1|
|Sales @ £2m – £2.99m||4||7|
|Sales @ £1.5m to £1.99m||16||5|
|Sales @ £1.0m to £1.49m||12||11|
|Sales @ £0.5m to £0.99m||108||64|
|Sales @ £0.20m to £0.49m||198||186|
Some explanation may be appropriate. Rightly or wrongly, we think top end buyers are increasingly apprehensive – but for good reason. They have nervousness about political issues – change of government, Scottish Independence (though, of course, by the time you read this, this issue will have been decided); fiscal issues – capital taxation, Stamp Duty, Council Tax – even military issues : war in the Middle East. It is all depressing the “quaffability” of this segment to a greater or lesser extent. So, while HMG continues to pump credit into the lower end, so sustaining the more frothy market there, those other segments which are still “mortgage-sensitive” will continue to benefit but less so as you rise up the scale. Against this, we are expecting more London owners cashing in on their gains to emerge.
There are some clouds on the horizon. We are currently nervous about the number of new flats being planned for the BH13 area. There are over 100 three-bedroom apartments in the construction and planning pipeline and a further 60+ two-bedroom. Of course, the best quality and those with sea views will always sell. However, while not all these schemes will secure financing, nor necessarily will all those which are built be brought to the market for sale, let alone all at the same time, the extent of the possible increase in supply does warrant the opportunity for some sober reflection (to continue the alcoholic theme !). That said, we remain confident of value retention for existing flat owners in the Canford Cliffs area. Happy to elaborate for those interested to call Berkeleys. If you’re good, there might even be a glass of bubbly awaiting you, too.
This article appears in the Autumn 2014 edition of “Pines and Chines,” the magazine for residents of Branksome Park and Canford Cliffs in Poole, Dorset.