Property market has bottomed - it's official

As Disraeli (and then later Mark Twain) said: "There are lies, damned lies and statistics" and boy does the UK property industry thrive on market data.

Every day we seem to be bombarded by forecasts from the government, estate agents, developers, building societies and Uncle Tom Cobbley.

At last though I've found a statistic that I trust because it comes straight from the horses mouth - those searching for property.

Bickey Russell is an analyst at Google and she's recently been talking about the way that the general public searches for property online.

Ms Rusell says that the public believes the days of the bargain are numbered, with queries relating to bargain properties, such as ‘repossessed homes’, ‘property auctions,’ and ‘cheap properties’, down by 55 percent since February.

She has all kinds of other statistics but it's this little gem that strikes a chord with me.  The number of property transactions is all about confidence. 

If Joe Public thinks that the market has bottomed (and clearly Joe does) then they're going to start buying again.

I know this sounds ultra simplistic (because it is) but I place more store in this single stat than all the bumph that gets released by the RICS, NEA or the agents/banks who all have not very well hidden agendas.

Ms Russell also says that the first half of 2009 saw unique visitors to property sites up 15 percent. In the same period searches for the term ‘house prices’ rose 28 percent (having seen falls in 2008) and general queries related to property were up 11 percent.

So there we have it - the recovery has started....how long it will take before transaction numbers rise consistently month on month nobody knows, but it's 9th November 2009 and I'm calling the bottom of the market.

www.cognacproperty.com

The yawning chasm between house buyers & sellers

I've had the same discussion with three different people over the last couple of days.

There seems to be a huge gap between what UK & international property buyers are prepared to offer for French property and what the locals are prepared to accept.

This means that although there are increased activity levels (enquiries, viewings and offers) the number of transactions involving international purchasers are still very low.

All three discussions have commented on the fact that the "mindset" in France is very different to the UK or USA.

I remember that when I lived in Surrey we wouldn't dream of visiting a house that had been on the market for more than a few months.  If the owners had been trying to sell it for over a year then quite clearly it was blighted with all kinds of hidden terrors awaiting the fool who bought it.

If a house has been marketed for a while then Brits tend to make a low offer and more often than not it's accepted, no one wants to hang around.

Out here there are thousands of houses that have been on the market for a year or more.  Locals don't see them as tainted or over-priced....they just haven't had the right buyer come along yet.  Prices here just don't fluctuate like they do in the UK and we haven't seen anywhere near the drop in value as my family and friends on the other side of the channel.

All of this is a huge generalisation of course and ultimately individual circumstances will dicate the price that someone will offer or accept.  However until this gap between "bottom of the market bargain hunters" and "intransigent owners" closes then times are going to remain tough for all of us who make our living in the property arena.

www.cognacproperty.com

French property market sees lending soar

The prudent French banking system seems to be paying off with finance still available (even at 100%) and a rise in house prices of 2.8% over the last six months (although a drop of 7.8% if you take the last 12 months.....lies, damned lies & statistics eh).

The source of these nuggets is the FNAIM and you can read a fuller report here.

Of course, as any estate agent will tell you, it's the number of transactions that is the key indicator rather than the vagaries of price.  This is why many agents are still struggling and thousands of staff have been laid off throughout France.  I don't know of any agencies in this region that are hiring again yet.

It seems to me that there is still a steady trickle of international buyers looking to purchase property in France but that many more are still waiting in the wings.  It's not a case of "if" this trickle will turn into a stream but "when".

Timing is always crucial in the property market - if any of us knew the answer to this for sure we'd be millionaires but I do have a hunch that Spring next year will see some of those currently vacant high street shops having shiny new agence immobilier signs being hung up over the door.

www.cognacproperty.com

French property portal launches iphone app

The leading property portal over here is http://www.seloger.com/ who claim a 70% share of the online market (think rightmove in the UK).

They have just launched their own application for the iphone.

This is a big thing for the way that property searches will be undertaken in the future.

Imagine being in a town or village in France and having the ability to instantly see details of all properties available. Price, floorplans, pictures, cadastral plans and any other info you need.

You'll be able to drive around, discount areas you don't like and just concentrate on those you do. Stop for lunch in some off the beaten track restaurant, fall in love with the surroundings and simply consult your iphone to see which of the houses around are for sale.

Don't hold your breath though. Whilst this is a most significant step it still is just one step.

For the process to work 100% efficiently you'll need a portal that lists all houses for sale and you'll need every agent/owner to input the pics, plans et al in the first place.

Don't forget that this is a country where half of all houses bought & sold are still done so privately.

This isn't going to happen in the short term (1-2 years) or even medium term (5-7 years) ....but it will eventually happen.

Traditional estate agents, property finders and everyone associated with this industry are going to have to adapt to a new way of working.

It will take a generation to work through (I doubt that 20% of my clients over the past six years have an iphone or even the slightest desire to know what an app is) but unless you're coming up to retirement age you should ignore this new way of living at your peril.

www.cognacproperty.com

French property - parallels with the UK market

Interesting article in the Daily Telegraph about the UK property market one year after Lehman Brothers collapse.

This bit really struck home:

The day recession dawned will linger in the minds of estate agents for years. “The effect of Lehman’s demise was immediate and immense,” says Ed Lewis, head of new homes in London for Savills. “It was as if the telephone sockets had been ripped from the walls and the lights turned out. Many of the younger agents had never seen anything like it. A year on and power has been restored, to a flicker of hope, anyway, and the telephones have just started to ring again.

It was the same here in Cognac. I'd been merrily sailing along for five years and new clients just seemed to appear out of thin air. France is an incredibly popular destination and overseas buyers will always need someone to find and then advise upon their investment.

Then, within the space of 24 hours, everything changed and the world just hunkered down.

Like the chap at Savills though my phone has been ringing for a few months now and the lights are flickering back on.

As it says at the end of the Telegraph article I'll be looking forward to the 15th September so I can say that "the year" is behind us. It's not quite a reason to crack open the Dom Perignon but the senior partner and I might risk a little of the local "methode traditionnelle".

www.cognacproperty.com