15 Dec Surviving the London property minefield.
The British capital’s market is enjoying a noticeable upswing at the moment, but before making any moves, be sure to choose the right agent.
London house prices have jumped to their highest in three years, with some boroughs enjoying double the value they had a decade ago. In well-heeled, sought-after areas such as Kensington and Mayfair, average sale prices have risen by 18 per cent to £3.2 million, according to Savills estate agency. Typical London house prices are now 8 per cent higher than they were in the peak of 2007 and, in the central London area of Westminster, prices have skyrocketed by 114 per cent, according to nationwide figures. Bolstering the prosperous London market are the weakness of the pound and the performance of global equity markets, which is reflecting well against the flailing euro. Low interest rates and a Help-to-Buy scheme subsidised by taxpayers are also contributing factors. To make the most of this positive upswing in the London property market, property owners thinking of selling should act now. And for those sitting on the fence, the introduction of a capital gains tax on home sales by non-residents from April 2015, might offer a further incentive to make a sale.
“Typical London house prices are now 8 per cent higher than they were in the peak of 2007 and, in the central London area of Westminster, prices have skyrocketed by 114 per cent, according to nationwide figures.”
The city has always been alluring to property owners from around the world. As the financial capital of Europe, and a safe haven for investment amid the economic instability felt around the world, Britain’s capital presents some wonderful opportunities, but buyers and sellers must tread carefully. When selling a property here, a vendor must navigate the thousands of unregulated estate agents in a bid to get an unbiased valuation and fair commission – a daunting task for even the most established Londoner, let alone a time-poor or overseas owner. The number of individual estate agents employed in Britain is at an all-time high, with 562,000 currently working in ”real estate activities”, up by almost 10 per cent between March and June this year, according to the Office for National Statistics. Several hundred agencies compete for the London market. Now the fastest growing sector of the British economy, it indicates that the British property market is appreciating fast and now is a great time to sell. It also means that, for the vendor, there are an overwhelmingly high number of agents to choose from. To compound the issue, there is no regulation policy or licensing scheme that estate agents must comply with in England. Anyone could work as an agent or set up an agency without qualification or experience – a situation which has led to an explosion of agencies and thousands of lone agents operating in London. It can be an extremely daunting experience for someone looking to sell their property and, without regulation, there is no protection for vendors. Choosing the right agent is crucial to get the best return on a property, and can mean a difference of thousands of pounds.
The proliferation of unregulated agents makes the choice particularly complicated, because there is no national standard which agents must comply with, or which consumers can refer to, when making this decision. Using a property consultancy service – which is independent of all estate agents – can remove this risk, by providing impartial advice and valuations, and helping sellers choose an appropriate agent. Companies such as DJP oversee each sale from start to finish, which allows the seller to make the transaction with confidence. The service is also free for the seller, as the consultant retains his or her fee from the estate agent. A property consultant can be particularly useful for international property owners looking to sell in London, because they negotiate on the seller’s behalf. Consultants work to ensure that the property sale reaches its full potential. This includes ensuring the agent secures the best exposure of the property in newspapers, magazines and property portals, as well as getting regular feedback on viewings, and managing the conveyancing and exchange of the property. The aim is to make the whole experience as smooth and efficient as possible, saving clients time and energy and offering the best service possible.
David Johnson is a director of independent London property consultants Inhous. You can contact him at 0044-207-3731079.