Are national property reports damaging local markets? Not a week passes without another national housing report making news headlines. House prices up, house prices down, a stagnating market, a decline in sellers, a rise in first-time buyers.
They make great headlines and sell newspapers, but are these UK-wide stories damaging local property markets?
Two things led me to question the influence of national reports: the latest news from the NAEA and how national house price indices affect the public.
First let’s tackle indices. Property journalist Hilary Osborne recently wrote about the different house prices indices in existence, mentioning eight report generators who all use different methods of calculation and often release conflicting news.
Hands up how many of you get these phone calls once a house price report is published: “I’ve read in the Daily Mail house prices have gone down so I want to reduce my offer,” or: “I’ve read online that houses prices have gone up, so I want to increase my asking price.”
Frustrating, isn’t it, when you know your local conditions might be at odds with a national report and somehow you have to appease the public being swayed by the headlines?
Secondly, I thought about sentiment – the way the NAEA and RICS often come to conclusions. The NAEA recently reported a ‘static’ market with low levels of registered buyers and sales per estate agency branch. The negative vibe filtered out across the media and it probably left potential sellers wondering if it was the right time to sell their property. We all know that the big challenge is getting more stock on the books and anything that deters possible sellers is a bad thing.
Talking to a recent client of ours, London and Kent agency Robinson Jackson, confirmed my thoughts. Sweeping national property stories are completely irrelevant to most buyers and sellers, and yet they’re what make the news and influence potential clients.
Peter Jackson, co-founder of Robinson Jackson, says national surveys can sometimes cause panic: “The general public, especially sellers, need accurate local property information rather than general overviews of the market. It’s frustrating when another UK-wide report gets published as it’s often a distorted snapshot of what’s really happening in the local property market.
“Buyers and sellers should really be concerning themselves with what is happening in their immediate locale as most people buy a home no more than five miles from where they currently live. I’d hate to see people disheartened by national studies.”
Peter went on to say how the Robinson Jackson Group is seeing 21% more buyers registering interest compared to last year and a 10% rise in sales – in total contrast to the bleak national picture the NAEA would have the public believe. Each town, neighbourhood and even street has its own property microclimate, and how it performs rarely makes the news.
It’s the local property news that should carry the most weight. If you’re buying in Portsmouth, for instance, why take notice of national figures whose analytics also include property prices and activity in Peterborough, Peckham and Perth?
Perhaps some bright spark will hook up with property entrepreneur Neil Harvey and extrapolate some local, meaningful statistics and stories from his newly launched local property portals.
For now, it’s up to estate agents to produce their own property reports and PR on how well their local areas are performing. Of course, there will always be some ‘talking up’ of the market, but the job is to convince sellers to think local and ignore national.
Hillary Osborne wrote about house price indices here:
https://www.guardian.co.uk/money/2012/may/03/house-prices-different-indices
Harry Simons is a partner at
Interiors – an office refurbishment company specialising in estate agency and commercial premises
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Comments
EW: "What happens in Newcastle does not reflect Devon."
No - but apparently what happens in Nottingham DOES - or at least SHOULD, according to the MDT rantings of Mr RR...
Absolutely spot on. For years I have been moaning that national averages are not indicative of the extremes they purport to represent. What happens in Newcastle does not reflect Devon. Likewise, these figures are seldom current as point of sale when price is agreed is set when the offer is accepted, not when the figures are recorded by lenders and land registry. These stats show trends, but when valuing a property have little impact on what is happing today.