There's a Drought in the Derby Property Market!

Well the dust has settled and the General Election was something that seems to have happened many months ago; a bit like the end of the football season!  So, we can get back to a more normal property market, or that is what the London based ‘Fleet Street’ journalists would lead you to believe. I do find that their opinion is often tainted by the market ‘down south’ so I get my local information from much more reliable sources. I have been talking to many fellow property professionals in Derby; solicitors, conveyancers, mortgage brokers and, one the best sources of information, the chap who puts all the estate agent and letting boards up in the area. Each of them told me the same story - they didn’t see any change in the couple of months that led up to the Election itself on the 7^th May.

I am now of the opinion that, maybe in the upmarket areas of Mayfair and Chelsea, the market went into spasm with the prospect of a Labour/SNP pact with their Mansion Tax for properties over £2,000,000, but, in little old Derby and the surrounding villages, there has only been two properties sold above £2,000,000 mark in the last 7 years so we had a somewhat different reaction!

  

In a nutshell, the General Election didn’t really have any impact on people’s confidence to buy property in Derby. As I write this article, of 1,687 properties that have come on to the market in Derby  since the 2^nd of April, 504 of them have a buyer and are sold subject to contract, that’s nearly one in three  - 29.87% to be precise.

I actually think that things are starting to change in the way people in Derby (in fact the whole of the country as I talk to other agents around the UK) buy and sell property. Back in the 1970’s, 80’s and 90’s the norm was to buy a terraced house as soon as you left home and do it up. Meanwhile, property prices had gone up, so you traded up to a 2 bed semi, then 3 bed semi and repeated to the process, until you found yourself in  large 4 bed detached house with a large mortgage.

 

Looking into this a little deeper like I have said in previous articles Derby people’s attitude to home ownership itself have changed over the last ten years. The pressure for youngsters to buy when young has gone as renting, not buying, is considered the norm for 20 something’s. This isn’t just a Derby thing, it’s a national thing, as I have noticed that people buy property by trading up (or down) because they need to, not because ‘it’s what people do’. This does means there are a lot less properties on the market compared to last decade.

A by-product of less people moving is less people selling their property. My research shows there are a lot fewer properties each month selling in Derby compared to last decade. For example, in February 2015, only 240 properties were sold in Derby sold. Compare this February 2002, and 423 properties sold and the same month in 2003, 421 properties.  I repeated the exercise on different sets of years, comparing the same month to allow for seasonal variations, and the results were identical if not greater. So what does this all mean?

 

Demand for Derby property isn’t flying away, but with fewer properties for sale, it means property prices are proving reasonably stable too. Stable, consistent and steady growth of property values in Derby, year on year, without the massive peaks and troughs we saw in the late 1980’s and mid/late 2000’s might just be the thing that the Derby property market needs in the long term.