HOUSING MARKET HITTING THE PEAK?

Prices in the Cambridge housing market may be hitting a peak says Martin Walshe FNAEA, director of Cheffins estate agency. Although the firm has had its best month ever, the flow of new properties into the market has increased significantly with the abolition of HIPs.

He says: “Supply and demand set the prices that people have to pay. We have seen price increases of between 20 and 30 per cent at the top end of the market over the past 12 months and sharp competition for properties. But that could be about to change. We may be into a more stable market with prices levelling out until the end of this year. A number of surveys have been forecasting a drop in house prices for the next two years but these national surveys do not take account of a micro-market like Cambridge, and a degree of stability for the Cambridge market is a more likely result and would perhaps be a positive outcome for both buyers and sellers alike.

“Other surveys suggest that prices are still rising dramatically but these are based on transactions between March and June. What really matters is what is happening today on the streets of Cambridge. There are significantly more properties being launched into the market than two months ago – that could well take the edge off price rises.”

Martin Walshe adds that there is still very strong demand at all levels of the local housing market and that rumours of a mortgage famine are grossly overstated. In addition, the Cambridge housing market is not dependant on first time buyers – he says that unfortunately they are more or less priced out of the market and tend to be forced to rent instead. A more important influence on market activity is downsizing to more affordable homes or those with lower running costs.

The diversity of the Cambridge economy and the impetus given by such institutions as the University and Addenbrooke’s hospital plus the dynamism of the hi tech spin offs provide an underlying strength.

SELECTIVE ELY MARKET
Elsewhere, in and around the city of Ely, for example, Mark Peck reports that more properties have come into the market and that prices have certainly peaked, although in the city demand continues to be high for Victorian and Edwardian properties near to the station and the river. He says: “In the price range £250,000 to £400,000 we are seeing a good flow of buyers. It is a question of properties being correctly priced and in the best locations.

“Demand in the villages is also strong for the better properties. For example, we have just agreed terms for a large detached modern property in Witchford for just under £600,000 – in this case, the buyer wanted to be closer to the King’s School in Ely. On the other hand we have seen some nervousness due to threatened job cuts in the public sector – which resulted in two offers being withdrawn on other properties.

“Overall, the market is changing. Prices have eased back slightly but demand is still good.”

NEWMARKET SUMMER LULL
Neil Harris FRICS FNAEA, Director at our Newmarket Office, says that demand is still strong and well-priced properties across the range are selling well, sometimes within days. To attract buyers properties must represent value for money.

The lower end of the market is slower partly because of the stricter credit rating of first time buyers who need a higher level of deposit to secure a competitive interest rate, and the choking off of buy to let investors due to the proposed changes in capital gains tax.

Neil reports that there is a summer lull developing but that is a seasonal factor. Prices, generally, are levelling off from the spring highs.

SAFFRON WALDEN STILL SELLING
“Against the usual summer holidays downtime we continue to sell good quality properties, including one in Newport at £1.45million and, near Clavering, a beautiful Grade II Listed thatched cottage at £925,000,” reports Bruce King MNAEA MARLA at our Saffron Walden Office.

He adds that although the recent rate of increase in house prices seems to have slowed down, the current high demand suggests a more stable market for the rest of the year.

For information on residential property for sale or to rent contact our nearest office:

Cambridge: 01223 214214
Ely: 01353 654900
Haverhill: 01440 707076
Newmarket: 01638 663228
Saffron Walden: 01799 523656.